Trustmark leases certain types of machinery and equipment to its customers through sales-type and direct financing leases as part of its equipment financing portfolio. These leases generally have remaining lease terms of one to eight years, some of which include renewal options and/or options for the lessee to purchase the leased property near or at the end of the lease term. Trustmark recognized interest income from its sales-type and direct financing leases of $4.2 million and $7.8 million for the three and six months ended June 30, 2025, respectively, compared to $3.0 million and $5.4 million for the three and six months ended June 30, 2024, respectively. Trustmark does not have any significant operating leases in which it is the lessor.

The table below summarizes the components of Trustmark's net investment in its sales-type and direct financing leases for the periods presented ($ in thousands):


	June 30, 2025			December 31, 2024
Leases receivable	$	325,720		$	282,771
Unearned income		(50,271	)		(45,585	)
Initial direct costs		2,862			2,252
Unguaranteed lease residual		14,868			7,084
Total net investment	$	293,179		$	246,522

The table below details the minimum future lease payments for Trustmark's leases receivable at June 30, 2025 ($ in thousands):


	June 30, 2025
2025 (excluding the six months ended June 30, 2025)	$	32,709
2026		61,170
2027		73,717
2028		63,284
2029		48,676
Thereafter		46,164
Lease receivable	$	325,720

For Trustmark's lessee arrangements, the leases of FBBI are included in discontinued operations and as a result, have been excluded from the amounts below. The following table details the components of net lease cost for the periods presented ($ in thousands):


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Finance leases:
Amortization of right-of-use assets	$	113		$	113		$	226		$	226
Interest on lease liabilities		34			38			68			76
Operating lease cost		1,341			1,232			2,682			2,412
Short-term lease cost		154			55			319			113
Variable lease cost		223			205			442			404
Sublease income		(76	)		(2	)		(135	)		(5	)
Net lease cost	$	1,789		$	1,641		$	3,602		$	3,226

The following table details the cash payments included in the measurement of lease liabilities during the periods presented ($ in thousands):


	Six Months Ended June 30,
	2025		2024
Finance leases:
Operating cash flows included in operating activities	$	68	$	76
Financing cash flows included in payments under finance lease obligations		225		207
Operating leases:
Operating cash flows (fixed payments) included in other operating activities, net		2,637		2,254
Operating cash flows (liability reduction) included in other operating activities, net		1,957		1,593

The following table details balance sheet information, as well as weighted-average lease terms and discount rates, related to leases at June 30, 2025 and December 31, 2024 ($ in thousands):


	June 30, 2025			December 31, 2024
Finance lease right-of-use assets, net of accumulated depreciation	$	3,073		$	3,299
Finance lease liabilities		3,685			3,910
Operating lease right-of-use assets		34,016			34,668
Operating lease liabilities		38,091			38,698

Weighted-average lease term:
Finance leases	6.85 years			7.35 years
Operating leases	9.05 years			9.31 years

Weighted-average discount rate:
Finance leases		3.61	%		3.61	%
Operating leases		3.76	%		3.72	%

At June 30, 2025, future minimum rental commitments under finance and operating leases were as follows ($ in thousands):


	Finance Leases			Operating Leases
2025 (excluding the six months ended June 30, 2025)	$	291		$	2,650
2026		589			5,277
2027		594			5,211
2028		599			4,946
2029		633			4,781
Thereafter		1,454			22,644
Total minimum lease payments		4,160			45,509
Less imputed interest		(475	)		(7,418	)
Lease liabilities	$	3,685		$	38,091