OCEANFIRST FINANCIAL CORP - FORM 8-K - EX-99.1

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8-K - FORM 8-K - OCEANFIRST FINANCIAL CORP	d728684d8k.htm

NASDAQ: OCFC

OceanFirst Financial Corp.

INVESTOR PRESENTATION

MAY 2014

Exhibit 99.1

NASDAQ: OCFC

OceanFirst Financial Corp.

Forward Looking Statements:

This

presentation

contains

certain

forward-looking

statements

within

the

meaning

the

Private

Securities

Reform

Act

1995

which

are

based

certain

assumptions

and

describe

future

plans,

strategies

and

expectations

the

Company.

These

forward-looking

statements

are

generally

identified

use

the

words

"believe,"

"expect,"

"intend,"

"anticipate,"

"estimate,"

"project,"

"will,"

"should,"

"may,"

"view,"

"opportunity,"

"potential,"

similar

expressions

confidence

The

Company's

ability

predict

results

the

actual

effect

future

plans

strategies

inherently

uncertain.

Factors

which

could

have

material

adverse

effect

the

operations

the

Company

and

its

subsidiaries

include,

but

are

not

limited

to,

changes

interest

rates,

general

economic

conditions,

levels

unemployment

the

Bank’s

lending

area,

real

estate

market

values

the

Bank’s

lending

area,

future

natural

disasters

and

increases

flood

insurance

premiums,

the

level

prepayments

loans

and

mortgage-backed

securities,

legislative/

regulatory

changes,

monetary

and

fiscal

policies

the

U.S.

Government

including

policies

the

U.S.

Treasury

and

the

Board

Governors

the

Federal

Reserve

System,

the

quality

composition

the

loan

investment

portfolios,

demand

for

loan

products,

deposit

flows,

competition,

demand

for

financial

services

the

Company's

market

area

and

accounting

principles

and

guidelines.

These

risks

and

uncertainties

are

further

discussed

the

Company’s

Annual

Report

Form

10-K

for

the

year

ended

December

31,

2013

and

should

considered

evaluating

forward-looking

statements

and

undue

reliance

should

not

placed

such

statements.

The

Company

does

not

undertake

and

specifically

disclaims

any

obligation

publicly

release

the

result

any

revisions

which

may

made

any

forward-looking

statements

reflect

events

circumstances

after

the

date

such

statements

reflect

the

occurrence

anticipated

unanticipated

events.

NASDAQ: OCFC

112 Years of Growth and Capital Management

Founded

Point

Pleasant,

NJ,

1902,

OceanFirst

has

grown

from

small

one-town

savings

and

loan

full-service

community

bank

serving

the

Central

New

Jersey

Shore.

Rebuilt

capital

from

6.05%

9.47%

through

the

Great

Recession

with

retained

earnings

and

completion

follow-on

common

stock

offering

November

2009.

Demutualized

1996

and

over

the

ensuing

years

generated

value

for

shareholders,

largely through

the

successful

implementation

and

execution

our

community

bank

model,

and

the strategic

repurchase

62.4%

original

IPO

shares.

Since

late

2011

utilized

repurchases

again

strategically

redeploy

surplus

capital

until

growth

prospects

improved.

While

213,766

remain

available

for

repurchase

under

current

authorization,

recent

growth

initiatives

have

yielded

positive

results

and

curtailed

repurchase

activity

although

the

Company

remains

opportunistic

the

market

place.

NASDAQ: OCFC

Community Bank serving the Central

Jersey Shore -

$2.3 billion in assets and

23 branch offices

Market Cap $289 million

Core deposits –

87.5%

of total deposits

Locally originated loan portfolio -

SNCs

Residential and commercial

real estate mortgages

C&I loans and lines

Consumer equity loans and lines

Corporate Profile

Note:

See

Appendix

for

Market

Demographic

information.

(

Ocean

Burlington

Morris

Sussex

Atlantic

Salem

Warren

Monmouth

Hunterdon

Cumberland

Bergen

Mercer

Somerset

Middlesex

Gloucester

Camden

Passaic

Cape May

Essex

Union

Hudson

Philadelphia

New York

NASDAQ: OCFC

Experienced Executive Management Team

OceanFirst Bank ESOP 10.5%

Directors & Senior Executive Officers 9.8% (CEO 5.7%)

Director and Proxy Officer Stock Ownership Guidelines

OceanFirst Foundation 7.1%

As of the March 11, 2014 proxy

record date.

Name

Position

# of Years in

Banking

# of Years

at OCFC

John R. Garbarino

Chairman, Chief Executive Officer

Christopher D. Maher

President, Chief Operating Officer

Michael J. Fitzpatrick

Executive Vice President, Chief Financial Officer

Joseph R. Iantosca

Executive Vice President, Chief Administrative Officer

Joseph J. Lebel III

Executive Vice President, Chief Lending Officer

Substantial

insider

ownership

27.4%

–

aligned

with

shareholders’

interests

Succession

planning

affirmed

–

Christopher

Maher

appointed

CEO

effective

January

2015

NASDAQ: OCFC

Our Strategy

Positioned as the leading Community Bank in attractive Central Jersey

Shore market –

developing the franchise, growing revenue and

creating additional value for shareholders

Strategically focused on revenue growth in commercial lending, wealth

management, and bankcard services

Guarding credit quality in ALL

business cycles

Growing diversified streams of non-interest income to decrease

reliance on Net Interest Margin (NIM)

On the watch for roll-up opportunities presented by local community

banks lacking the scale or desire to remain independent

NASDAQ: OCFC

Significant Primary Market Deposit Share

Competing

Favorably

Against

Banking

Behemoths

# of

Dep. In Mkt.

Mkt. Shr.

Rank

Institution

Branches

($000)

(%)

Ocean County, NJ

TD Bank, National Association (Canada)

2,460,349

16.88

Hudson City Bancorp Inc. (NJ)

(1)

2,415,792

16.57

Wells Fargo Bank NA (CA)

2,315,657

15.89

OceanFirst Financial Corp. (NJ)

1,488,197

10.21

Banco Santander S.A. (Spain)

1,438,132

9.87

Bank of America Corp. (NC)

1,292,963

8.87

Total For Institutions In Market

192

14,577,615

Source: FDIC Summary of Deposits, June 30, 2013

(1)

Pending acquisition by M&T Bank (NY)

NASDAQ: OCFC

Strategic Deposit Composition Transition

NASDAQ: OCFC

Strategic Loan Composition Transition

NASDAQ: OCFC

Grew commercial loan portfolio by $27.5 million, 18.7%

annualized

Earnings per share of $0.28 resulting in a 8.7% ROE &

0.83% ROA

Net interest margin has stabilized at 3.36%, above the

historical average of 3.28%

Strong capital position –

tangible common equity of 9.5% of

assets

Announced that Christopher D. Maher will succeed John R.

Garbarino as CEO effective January 1, 2015

Highlights –

First Quarter 2014

NASDAQ: OCFC

Stabilized NPL’s in a Diversified Portfolio

Data as of December 31, unless otherwise indicated.

(1)

Increase attributable to Superstorm Sandy.

Exposure

Primarily

Lower

Risk

Residential

NASDAQ: OCFC

Prudently Provisioning for Credit Costs

$10

Net Charge-Offs

Provision for Loan Losses

(1)

Spike in charge-offs was due to a change in charge-off policy to recognize the charge-off when the loan is deemed

uncollectible rather than when the foreclosure process is complete. The additional charge-off relating to the change in

policy through 2011 was $5.7 million, all of which had been previously specifically reserved.

(2)

Increase attributable to Superstorm Sandy.

12/31/09

12/31/10

12/31/11

(1)

12/31/12

(2)

12/31/13

3/31/14

(Annualized)

NASDAQ: OCFC

Net Interest Margin

Stabilizing

Historical

Levels

NASDAQ: OCFC

Diversified Streams of Non-Interest Income

2011

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

1996

3/31/14 (Annualized)

Fees and Service Charges

Gain on Sale of Loans

BOLI

Other

BankCard Services

Investment Services

Wealth Management

Non-Interest Income excludes gain/loss from other real estate operations, gain on sale of equity securities and

provision for repurchased loans.

$2.5M

$16.1M

Targeted

Growth

Areas

NASDAQ: OCFC

Generating Consistent Attractive Returns

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

2009

2010

2011

2012

2013

3/31/2014

(Annualized)

Return on Equity

Return on Assets

0.0%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

(1)

Excludes

after-tax

impact

$3.1

million

non-recurring

charges

strategic

advance

restructuring

and

branch

consolidation.

NASDAQ: OCFC

Prudently Managing Capital

2011

$0.0

$5.0

$10.0

$15.0

$20.0

$25.0

2011

2012

2013

Note: Stock Repurchases –

$14.37 Average Cost per Share

Cash

Dividends

Stock Repurchases

NASDAQ: OCFC

Challenge Today is to Grow Revenue

Build Shareholder Value

Target

growth

within

existing

market

–

increasing

Commercial

loans

outstanding

has

experienced

double

digit

growth

rate

for

three

consecutive

quarters

Continuing Strategic Execution

FHLB Advances restructured in Q4

Rationalizing Branch Network and Residential Lending

Consolidated two overlapping branches in Q4; reinvesting to support revenue growth

Reducing residential lending origination expenses, reinvesting to support revenue growth

14 Denovos since 2000; opportunity for additional growth

Growing and diversifying non-interest income streams; reducing reliance on NIM

Assessing opportunistic roll-up of local community banks

Financial performance develops value proposition for shareholders and preserves the

right to remain independent

NASDAQ: OCFC

Why OCFC…?

Fundamental franchise value –

superior market demographics

Well-established bank with a 112 year history in the market

Crisis tested management team

Sandy response and experience

Substantial insider ownership –

aligned with shareholders’

interests

Succession planning affirmed –

2014

Attractive deposit mix and market share

Conservative credit culture and profile

Solid financial performance –

developing shareholder value

Strong balance sheet and capital base

NASDAQ: OCFC

THANK YOU

FOR YOUR INTEREST IN

OCEANFIRST FINANCIAL CORP.

NASDAQ: OCFC

Superstorm Sandy Recovery

Providing Market Opportunity

OceanFirst Loan Portfolio Performed Well

Damage Estimate ( FEMA 2012):

50,103 structures damaged were located in Monmouth and Ocean County

3,033 structures classified as major damage or totally destroyed

Multi-Year Recovery Horizon

4,307

Homes

demolished

Monmouth

and

Ocean

2013;

59%

all

homes

demolished

New

Jersey

Toms River Statistics

1,108 homes demolished in 2013 (of 30,235 Single Family Homes)

129 permits for $19.4 million issued in first quarter of 2014

OceanFirst Construction Lending* (as of March 31, 2014)

$37.9 million in consumer originated/committed; $14.0 million undrawn

$58.0

million

commercial

originated/committed;

$30.5

million

undrawn

$17.7 million pipeline

* Construction lending has been driven by owner-occupied projects resulting from storm damage

APPENDIX 1

NASDAQ: OCFC

Market Demographics

APPENDIX 2

Ocean

Monmouth

Middlesex

New Jersey

National

Number of Offices

% of OceanFirst Deposits

86.6

10.3

3.1

Market Rank

Market Share (%)

10.2

0.9

0.2

Population

577,000

635,000

816,000

Projected 2012-2017

Population Growth (%)

1.6

1.0

2.1

1.2

3.5

Median Household Income ($)

59,000

81,000

77,000

67,000

50,000

Projected 2012-2017 Median

Household Income Growth (%)

22.6

14.0

13.1

18.9

13.4

Deposit data as of June 30, 2013.

Demographic data as of December 31, 2012.

Source: SNL Financial

NASDAQ: OCFC

Residential Real Estate

Total Portfolio

$786.5 million

% of Total Loan Portfolio

49.1%

Average size of mortgage loans

$190,000

Interest-only loans

$26.7 million

- % of total 1-4 family loans

3.4%

- Weighted average loan-to-value ratio (using original or most recent appraisal)

60%

Stated income loans

$35.5 million

- % of total 1-4 family loans

4.5%

Portfolio weighted average loan-to-value ratio (using original or most recent appraisal)

56%

- Loans originated during 2014

61%

Portfolio average FICO score

748

- Loans originated during 2014

770

% of loans outside the New York/New Jersey market

3.9%

% of loans outside Ocean/Monmouth Counties

30.9%

% of loans exceeding agency conforming amounts

45.2%

% of loans for second homes

8.3%

APPENDIX 3

Residential Portfolio Metrics

As of March 31, 2014, unless

otherwise noted.

NASDAQ: OCFC

APPENDIX 3

(Cont’d)

Commercial Portfolio Metrics

As of March 31, 2014.

(1)

Combined commercial relationships (excluding small business) total 413.

Commercial Real Estate (CRE)

Total portfolio $550.8 million

% of Total Loan Portfolio 34.4%

Average size of CRE loans $820,000

Largest CRE loan $14.6 million

(Secured by local university dormitory housing)

Current Pipeline $33.2 million

Weighted Average Yield 4.54%

Weighted Average Repricing Term 5.7 years

Commercial Loans

Total portfolio $66.2 million

% of Total Loan Portfolio 4.1%

Average size of commercial loan $261,000

Largest commercial loan $4.1 million

Current Pipeline $13.6 million

Weighted Average Yield 3.16%

Weighted Average Repricing Term 1.5 years

(1)

NASDAQ: OCFC

Office, 31.5%

Commercial

Development, 8.0%

Shopping Center, 9.5%

Retail Store, 9.6%

Multi-Family, 2.5%

Miscellaneous, 19.1%

Land,

3.7%

Industrial/

Warehouse, 11.1%

Residential

Development, 5.0%

Commercial Portfolio Segmentation

Real Estate

Investment, 37.0%

Arts/Entertainment/

Recreation, 7.7%

Other Services, 3.5%

Retail Trade, 3.0%

Public Administration,

6.4%

Miscellaneous, 6.1%

Manufacturing, 3.5%

Educational Services,

3.7%

Accommodations/

Food Services, 7.5%

Healthcare, 7.6%

Wholesale Trade, 5.2%

Construction, 8.8%

Total Commercial Loan Exposure

by Industry Classification

Real Estate Investment by

Property Classification

As of March 31, 2014.

APPENDIX 3

(Cont’d)

Diversified portfolio provides

protection against industry-

specific credit events.

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