Note 3 – Securities Available for Sale and Held to Maturity

The following table is a summary of the amortized cost and estimated fair value of securities available for sale and held to maturity ($ in thousands):

	Securities Available for Sale									Securities Held to Maturity
			Gross		Gross			Estimated				Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair		Amortized		Unrealized		Unrealized			Fair
September 30, 2013	Cost		Gains		(Losses)			Value		Cost		Gains		(Losses)			Value
U.S. Treasury securities	$	503	$	-	$	-		$	503	$	-	$	-	$	-		$	-
U.S. Government agency obligations
Issued by U.S. Government agencies		133,258		1,125		(1,370	)		133,013		-		-		-			-
Issued by U.S. Government sponsored agencies		138,937		24		(6,536	)		132,425		-		-		-			-
Obligations of states and political subdivisions		206,168		7,460		(637	)		212,991		30,229		2,974		-			33,203
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		48,737		596		(1,093	)		48,240		2,420		158		-			2,578
Issued by FNMA and FHLMC		211,031		4,427		(663	)		214,795		564		35		-			599
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		2,083,906		14,665		(50,296	)		2,048,275		-		-		-			-
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		349,679		8,568		(4,116	)		354,131		36,767		114		(2,312	)		34,569
Asset-backed securities and structured financial products		225,621		2,119		(12	)		227,728		-		-		-			-
Total	$	3,397,840	$	38,984	$	(64,723	)	$	3,372,101	$	69,980	$	3,281	$	(2,312	)	$	70,949

December 31, 2012
U.S. Government agency obligations
Issued by U.S. Government agencies	$	10	$	-	$	-		$	10	$	-	$	-	$	-	$	-
Issued by U.S. Government sponsored agencies		105,396		339		-			105,735		-		-		-		-
Obligations of states and political subdivisions		202,877		12,900		(16	)		215,761		36,206		4,184		-		40,390
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		18,981		921		-			19,902		3,245		227		-		3,472
Issued by FNMA and FHLMC		201,493		7,071		-			208,564		572		52		-		624
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		1,436,812		29,574		(20	)		1,466,366		-		-		-		-
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		380,514		19,420		(154	)		399,780		2,165		237		-		2,402
Asset-backed securities and structured financial products		238,893		2,755		(21	)		241,627		-		-		-		-
Total	$	2,584,976	$	72,980	$	(211	)	$	2,657,745	$	42,188	$	4,700	$	-	$	46,888

Temporarily Impaired Securities

The table below includes securities with gross unrealized losses segregated by length of impairment ($ in thousands):

	Less than 12 Months					12 Months or More					Total
			Gross					Gross					Gross
	Estimated		Unrealized			Estimated		Unrealized			Estimated		Unrealized
September 30, 2013	Fair Value		(Losses)			Fair Value		(Losses)			Fair Value		(Losses)
U.S. Government agency obligations
Issued by U.S. Government agencies	$	60,939	$	(1,370	)	$	-	$	-		$	60,939	$	(1,370	)
Issued by U.S. Government sponsored agencies		132,140		(6,536	)		-		-			132,140		(6,536	)
Obligations of states and political subdivisions		27,414		(636	)		569		(1	)		27,983		(637	)
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		36,322		(1,093	)		-		-			36,322		(1,093	)
Issued by FNMA and FHLMC		49,792		(663	)		-		-			49,792		(663	)
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		1,352,905		(50,293	)		368		(3	)		1,353,273		(50,296	)
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		153,092		(6,428	)		-		-			153,092		(6,428	)
Asset-backed securities and structured financial products		16,513		(12	)		-		-			16,513		(12	)
Total	$	1,829,117	$	(67,031	)	$	937	$	(4	)	$	1,830,054	$	(67,035	)

December 31, 2012
Obligations of states and political subdivisions	$	5,878	$	(16	)	$	-	$	-		$	5,878	$	(16	)
Mortgage-backed securities
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		3,055		(20	)		-		-			3,055		(20	)
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC or GNMA		-		-			16,339		(154	)		16,339		(154	)
Asset-backed securities and structured financial products		16,412		(21	)		-		-			16,412		(21	)
Total	$	25,345	$	(57	)	$	16,339	$	(154	)	$	41,684	$	(211	)

Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment related to other factors is recognized in other comprehensive loss. In estimating other-than-temporary impairment losses, Management considers, among other things, the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer and the intent and ability of Trustmark to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. The unrealized losses shown above are primarily due to increases in market rates over the yields available at the time of purchase of the underlying securities and not credit quality. Because Trustmark does not intend to sell these securities and it is more likely than not that Trustmark will not be required to sell the investments before recovery of their amortized cost bases, which may be maturity, Trustmark does not consider these investments to be other-than-temporarily impaired at September 30, 2013. There were no other-than-temporary impairments for the nine months ended September 30, 2013 and 2012.

Security Gains and Losses

Gains and losses as a result of calls and dispositions of securities, as well as any associated proceeds, were as follows ($ in thousands):

	Three Months Ended September 30,					Nine Months Ended September 30,
Available for Sale	2013		2012			2013			2012
Proceeds from calls and sales of securities	$	-	$	2,710		$	64,778		$	37,536
Gross realized gains		-		-			394			1,050
Gross realized (losses)		-		(1	)		(16	)		(12	)

Held to Maturity
Proceeds from calls of securities	$	-	$	-		$	-		$	175
Gross realized gains		-		-			-			3

Realized gains and losses are determined using the specific identification method and are included in noninterest income as security gains (losses), net.

Contractual Maturities

The amortized cost and estimated fair value of securities available for sale and held to maturity at September 30, 2013, by contractual maturity, are shown below ($ in thousands). Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Securities				Securities
	Available for Sale				Held to Maturity
			Estimated				Estimated
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value
Due in one year or less	$	10,080	$	10,142	$	1,627	$	1,650
Due after one year through five years		244,598		248,610		13,744		14,789
Due after five years through ten years		271,029		270,117		14,104		15,974
Due after ten years		178,780		177,791		754		790
		704,487		706,660		30,229		33,203
Mortgage-backed securities		2,693,353		2,665,441		39,751		37,746
Total	$	3,397,840	$	3,372,101	$	69,980	$	70,949