Note 6 –Other Real Estate and Covered Other Real Estate

Other Real Estate, excluding Covered Other Real Estate

At September 30, 2015, Trustmark’s geographic other real estate distribution was concentrated primarily in its five key market regions: Alabama, Florida, Mississippi, Tennessee and Texas. The ultimate recovery of a substantial portion of the carrying amount of other real estate, excluding covered other real estate, is susceptible to changes in market conditions in these areas.

For the periods presented, changes and gains, net on other real estate, excluding covered other real estate, were as follows ($ in thousands):

	Nine Months Ended September 30,
	2015			2014
Balance at beginning of period	$	92,509		$	106,539
Additions		26,832			29,972
Disposals		(33,015	)		(34,641	)
Write-downs		(2,371	)		(4,833	)
Balance at end of period	$	83,955		$	97,037

Gain, net on the sale of other real estate included in ORE/Foreclosure expense	$	2,116		$	2,847

At September 30, 2015 and December 31, 2014, other real estate, excluding covered other real estate, by type of property consisted of the following ($ in thousands):

	September 30, 2015		December 31, 2014
Construction, land development and other land properties	$	55,485	$	61,015
1-4 family residential properties		9,466		10,150
Nonfarm, nonresidential properties		17,509		19,696
Other real estate properties		1,495		1,648
Total other real estate, excluding covered other real estate	$	83,955	$	92,509

At September 30, 2015 and December 31, 2014, other real estate, excluding covered other real estate, by geographic location consisted of the following ($ in thousands):

	September 30, 2015		December 31, 2014
Alabama	$	23,822	$	21,196
Florida		30,374		35,324
Mississippi (1)		13,180		17,397
Tennessee (2)		9,840		10,292
Texas		6,739		8,300
Total other real estate, excluding covered other real estate	$	83,955	$	92,509

(1)	- Mississippi includes Central and Southern Mississippi Regions

(2)	- Tennessee includes Memphis, Tennessee and Northern Mississippi Regions

Covered Other Real Estate

For the periods presented, changes and losses, net on covered other real estate were as follows ($ in thousands):

	Nine Months Ended September 30,
	2015			2014
Balance at beginning of period	$	6,060		$	5,108
Transfers from covered loans		266			690
FASB ASC 310-30 adjustment for the residual recorded investment		(902	)		9
Net transfers from covered loans		(636	)		699
Disposals		(1,404	)		(870	)
Write-downs		(1,155	)		(791	)
Balance at end of period	$	2,865		$	4,146

Loss, net on the sale of covered other real estate included in ORE/Foreclosure expense	$	(54	)	$	(132	)

At September 30, 2015 and December 31, 2014, covered other real estate by type of property consisted of the following ($ in thousands):

	September 30, 2015		December 31, 2014
Construction, land development and other land properties	$	759	$	1,917
1-4 family residential properties		356		1,103
Nonfarm, nonresidential properties		1,359		2,296
Other real estate properties		391		744
Total covered other real estate	$	2,865	$	6,060