 NASDAQ: OCFC
1
OceanFirst Financial Corp.
OceanFirst Financial Corp.
John
John
R.
R.
Garbarino
Garbarino
-
-
Chairman,
Chairman,
CEO
CEO
Vito
Vito
R.
R.
Nardelli
Nardelli
-
-
President,
President,
COO
COO
Michael
Michael
J.
J.
Fitzpatrick
Fitzpatrick
-
-
Executive
Executive
Vice
Vice
President,
President,
CFO
CFO
INVESTOR PRESENTATION
INVESTOR PRESENTATION
JUNE 2011
JUNE 2011
Exhibit 99.1 |
 NASDAQ: OCFC
2
OceanFirst Financial Corp.
OceanFirst Financial Corp.
Forward Looking Statements:
This
presentation
contains
certain
forward-looking
statements
within
the
meaning
of
the
Private
Securities
Reform
Act
of
1995,
which
are
based
on
certain
assumptions
and
describe
future
plans,
strategies
and
expectations
of
the
Company.
These
forward-
looking
statements
are
generally
identified
by
use
of
the
words
“believe”,
“expect”,
“intend”,
“anticipate”,
“estimate”,
“project”,
“will”,
“should”,
“may”,
“view”,
“opportunity”,
“potential”,
or
similar
expressions
or
expression
of
confidence.
The
Company’s
ability
to
predict
results
or
the
actual
effect
of
future
plans
or
strategies
is
inherently
uncertain.
Factors
which
could
have
a
material
adverse
effect
on
the
operations
of
the
Company
and
the
subsidiaries
include,
but
are
not
limited
to,
changes
in
interest
rates,
general
economic
conditions,
levels
of
unemployment
in
the
Bank’s
lending
area,
legislative/regulatory
changes,
monetary
and
fiscal
policies
of
the
U.S.
Government,
including
policies
of
the
U.S.
Treasury
and
the
Board
of
Governors
of
the
Federal
Reserve
System,
the
quality
or
composition
of
the
loan
or
investment
portfolios,
demand
for
loan
products,
deposit
flows,
competition,
demand
for
financial
services
in
the
Company’s
market
area
and
accounting
principles
and
guidelines.
These
risks
and
uncertainties
are
further
discussed
in
the
Company’s
Annual
Report
on
Form
10-K
for
the
year
ended
December
31,
2010
and
its
subsequent
securities
filings
and
should
be
considered
in
evaluating
forward-looking
statements
and
undue
reliance
should
not
be
placed
on
such
statements.
The
Company
does
not
undertake
–
and
specifically
disclaims
any
obligation
–
to
publicly
release
the
result
of
any
revisions
which
may
be
made
to
any
forward-looking
statements
to
reflect
events
or
circumstances
after
the
date
of
such
statements
or
to
reflect
the
occurrence
of
anticipated
or
unanticipated
events. |
 NASDAQ: OCFC
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Our 109-Year History
Our 109-Year History
Founded in Point Pleasant, NJ, in 1902, OceanFirst has
grown from a small one-town savings and loan to a full-service
community bank serving the Jersey shore.
Completed a follow-on common stock offering in November 2009
with part of the
$54.2 million proceeds used on December 30 to redeem the Preferred Stock
investment made by the U.S. Treasury. OceanFirst went public in 1996 and since
then has been successful
as a public company generating value for our shareholders.
|
 NASDAQ: OCFC
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Ocean
Burlington
Morris
Sussex
Atlantic
Salem
Warren
Monmouth
Hunterdon
Cumberland
Bergen
Mercer
Somerset
Middlesex
Gloucester
Camden
Passaic
Cape May
Essex
Union
Hudson
Community Bank serving the
Jersey
Shore
-
$2.3
billion
in
assets and 23 branch offices
Market Cap $256 million (as of
May 31,
2011)
Core
deposit
funded
–
83.4%
of
total deposits
Locally originated loan portfolio
with no brokered loans
Residential and commercial
mortgages
Consumer equity loans and
lines
C&I loans and lines
Corporate Profile
Corporate Profile
Philadelphia
New York
Note: See Appendix 1 for Market Demographic information.
|
 NASDAQ: OCFC
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Experienced Executive Management Team
Experienced Executive Management Team
Insider ownership of 27.5% is
substantial –
aligned with shareholders
OceanFirst Bank ESOP 10.3%
OceanFirst Foundation 7.1%
Directors & Senior Executive Officers 10.1% (CEO 5.3%)
As of the March 9, 2011 proxy
record date.
Name
Position
# of Years in
Banking
# of Years
at OCFC
John R. Garbarino
Chairman, Chief Executive Officer
40
40
Vito R. Nardelli
President, Chief Operating Officer
37
7
Michael J. Fitzpatrick
Executive Vice President, Chief Financial Officer
30
19 |
 NASDAQ: OCFC
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Our Strategy
Our Strategy
Positioned as the leading Community Bank alternative in attractive
Central
Jersey
Shore
market
–
growing
revenue
and
creating
additional value for our shareholders
Offering a full range of consumer and commercial banking products
generating diversified income streams
Guarding
credit
quality
in
ALL
business
cycles
Transitioning the balance sheet with emphasis on core deposit
funding and commercial lending growth
Ready for roll-up opportunities presented by smaller, in-market
“regulatory fatigued”
competitors |
 NASDAQ: OCFC
7
Diluted earnings per share increased 16.7% to $0.28. Return on
average stockholders’
equity was 10.1%
The net interest margin expanded 8 bps over the linked quarter to
3.60%
Core
deposits
(i.e.,
all
deposits
excluding
time
deposits)
comprise
83.4% of total deposits
Non-performing loans decreased by $1.8 million, 4.9%, and
represent 2.15% of total loans receivable
Strong capital position, tangible common equity of 9.1% of assets.
Book value grew 24¢
to $10.93
Highlights –
Highlights –
First Quarter 2011
First Quarter 2011 |
 NASDAQ: OCFC
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Increasing Primary Market Deposit Share
Increasing Primary Market Deposit Share
June 30, 2010
# of
Dep. In Mkt.
Mkt. Shr.
Rank
Institution
Branches
($000)
(%)
Ocean County, NJ
1
Hudson City Bancorp Inc. (NJ)
13
2,773,130
21.66
2
Wells Fargo & Co. (CA)
27
1,810,777
14.14
3
TD Bank National Association (Canada)
20
1,776,218
13.87
4
OceanFirst Financial Corp. (NJ)
18
1,282,436
10.02
5
Banco Santander S.A. (Spain)
25
1,254,237
9.80
6
Bank of America Corp. (NC)
23
1,234,572
9.64
7
Investors Bancorp Inc. (MHC) (NJ)
7
637,788
4.98
8
PNC Financial Services Group (PA)
12
420,227
3.28
9
Sun Bancorp Inc. (NJ)
6
235,558
1.84
10
Manasquan Savings Bank (NJ)
3
225,540
1.76
Total For Institutions In Market
191
12,803,921
Source: FDIC
Moving from 6
th
to 4
th
in Last Year |
 NASDAQ: OCFC
9
Interest
Bearing
Demand
Deposits,
28.2%
Non-Interest
Bearing
Demand
Deposits,
8.9%
Jumbo Time
Deposits(1),
8.1%
Retail Time
Deposits,
27.7%
MMDA &
Savings,
27.1%
Deposit Composition Transition
Deposit Composition Transition
Interest
Bearing
Demand
Deposits,
7.6%
Non-Interest
Bearing
Demand
Deposits,
0.7%
Jumbo Time
Deposits(1),
4.7%
Retail Time
Deposits,
61.4%
MMDA &
Savings,
25.6%
Interest
Bearing
Demand
Deposits,
55.0%
Non-Interest
Bearing
Demand
Deposits,
8.3%
Jumbo Time
Deposits(1),
4.9%
Retail Time
Deposits,
11.7%
MMDA &
Savings,
20.1%
(1) Jumbo CDs have a balance of $100,000 or greater.
December 31, 2005
March 31, 2011
December 31, 1996 |
 NASDAQ: OCFC
10
Commercial
R.E., 26.2%
Residential
R.E., 56.3%
Commercial
& Industrial,
4.6%
Construction
R.E., 0.7%
Consumer &
Other(1),
12.2%
Loan Composition Transition
Loan Composition Transition
Commercial
R.E., 3.2%
Residential
R.E., 89.6%
Commercial
& Industrial,
0.4%
Construction
R.E., 1.1%
Consumer &
Other(1),
5.7%
Commercial
R.E., 16.5%
Residential
R.E., 69.8%
Commercial
& Industrial,
3.8%
Construction
R.E., 1.3%
Consumer &
Other(1),
8.6%
(1)
Consumer and other loans primarily consist of home equity lines and loans.
Note:
See Appendix 2 for specific portfolio metrics and commercial portfolio
segmentation. December 31, 2005
March 31, 2011
December 31, 1996 |
 NASDAQ: OCFC
11
NPL’s in a Diversified Portfolio
NPL’s in a Diversified Portfolio
Non-performing loan (“NPL”).
Data as of December 31 unless otherwise indicated.
0.00%
0.25%
0.50%
0.75%
1.00%
1.25%
1.50%
1.75%
2.00%
2.25%
2.50%
2008
2009
2010
3/31/2011
One-to-Four Family
Consumer
Commercial Real Estate and Construction
Commercial
Recent Improvement in Credit Quality –
Modest Commercial Exposure |
 NASDAQ: OCFC
12
Provision for Loan Losses Exceed Charge-Offs
Provision for Loan Losses Exceed Charge-Offs
Building ALLL
$0
$2,000
$4,000
$6,000
$8,000
$10,000
12/31/08
12/31/09
12/31/10
3/31/2011
Net Charge-Offs
Provision for Loan Losses |
 NASDAQ: OCFC
13
Quarterly Residential Delinquency Trends
Quarterly Residential Delinquency Trends
OceanFirst Well Below New Jersey Benchmarks
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
2008
2009
2010
2011
OCFC All Mortgage Loans
MBA NJ Mortgage Loans
MBA NJ Conventional (Prime) Mortgage Loans |
 NASDAQ: OCFC
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Net Interest Margin
Net Interest Margin
Off Cyclical High But Expanded in Q1
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
2008
2009
2010
2011
2011 |
 NASDAQ: OCFC
15
Diversified Streams of Non-Interest Income (NII)
Diversified Streams of Non-Interest Income (NII)
BOLI, 9.2%
Gain on Sale
of Loans,
11.0%
Other, 7.8%
Fees and
Service
Charges,
72.0%
December 31, 1996
BOLI, 4.7%
Gain on Sale
of Loans(1),
54.7%
Other, 1.4%
Fees and
Service
Charges,
39.2%
December 31, 2005
Gain on Sale of
Loans, 19.8%
Merchant
Services,
15.4%
Deposit Fees,
32.9%
Other, 8.8%
Other, 2.5%
BOLI, 6.5%
NII -
$3.8 Million (3 months)
March 31, 2011
NII -
$2.5 Million
NII -
$24.1 Million
(1)
Fees and
Service
Charges,
71.2%
Non-Interest Income (NII) excludes gain (loss) from other real estate
operations. (1)
Includes income from the Bank’s mortgage banking subsidiary which existed from
2001 through 2007. |
 NASDAQ: OCFC
16
Delivering Double-Digit Return on Equity
Delivering Double-Digit Return on Equity
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
2008
2009
2010
2011
(1) Annualized
(1) |
 NASDAQ: OCFC
17
Challenge Today is to Grow Revenue
Challenge Today is to Grow Revenue
Build Shareholder Value
Build Shareholder Value
Business
Plan
targets
growth
within
existing
footprint
–
increasing
market share
Twelve
new
branches
since
2000
have
performed
well
–
still
present room for additional growth
Non-interest income streams have been diversified, more important
as margin expansion may have run its course
Opportunistic roll-up of smaller community banks in market
Financial performance to Plan earns OceanFirst the right to remain
independent |
 NASDAQ: OCFC
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(1)
Peers include: ALNC, CNBC, DCOM, FFIC, FLIC, HUVL, KRNY, LBAI, PBNY, PGC, RCKB,
STBC, STL, SUBK, and TRST Note:
Financial data for the period ended March 31, 2011. Share price as of May
31, 2011. Source: Sandler O’Neill.
Attractive Valuation Metrics
Attractive Valuation Metrics
OCFC
Peers
(1)
Valuation
Price / Tang. Book Value
124%
146%
Price / LQA EPS
12.1x
14.8x
Price / Estimated EPS
11.1x
12.5x
Cash Dividend Yield
3.53%
2.74% |
 NASDAQ: OCFC
19
Why OCFC…?
Why OCFC…?
Fundamental
franchise
value
–
superior
market
demographics
Experienced management team with substantial insider ownership –
aligned with shareholders
Increasing deposit market share
Conservative credit culture and profile
Solid financial performance –
developing shareholder value
Strong balance sheet and capital base
Attractive current valuation |
 NASDAQ: OCFC
20
THANK YOU
THANK YOU
FOR YOUR INTEREST IN
FOR YOUR INTEREST IN
OCEANFIRST FINANCIAL CORP.
OCEANFIRST FINANCIAL CORP. |
 NASDAQ: OCFC
21
Market Demographics
Market Demographics
APPENDIX 1
Ocean
Monmouth
Middlesex
New Jersey
National
Number of Offices
18
4
1
% of OceanFirst Deposits
83.3
13.4
3.3
Market Rank
4
17
34
Market Share (%)
10.0
1.1
0.2
Population
578,728
649,429
794,605
Projected 2010-2015
Population Growth (%)
4.0
2.0
1.8
1.2
3.8
Median Household Income ($)
60,936
82,974
78,561
72,519
54,442
Projected 2010-2015 Median
Household Income Growth (%)
15.5
14.3
17.5
14.7
12.4
Deposit data as of June 30, 2010.
Demographic data as of June 30, 2010.
Source: SNL Financial |
 NASDAQ: OCFC
22
One-to-Four Family Loans
Average size of mortgage loans
$185,000
Interest-only loans - Amount
$73.3 million
- Percent of total one-to-four family
loans 7.7%
Stated income loans - Amount
$58.9 million
- Percent of total
one-to-four family loans 6.2%
Portfolio weighted average loan-to-value ratio (using original appraisal)
58%
Weighted average loan-to-value ratio of loans originated for the year ended December 31, 2010
60%
Weighted average loan-to-value ratio of loans originated for the quarter
62%
Average FICO score
746
Average FICO score of loans originated for the year ended December 31, 2010
764
Average FICO score of loans originated for the quarter
758
Percent of jumbo loans at origination
45.2%
Percent of loans outside the New York/New Jersey market
5.8%
Percent of loans for second homes
7.8%
APPENDIX 2
Residential Portfolio Metrics
Residential Portfolio Metrics
As of March 31, 2011, unless
otherwise noted. |
 NASDAQ: OCFC
23
Commercial Real Estate
Average size of commercial real estate loans
$719,000
Largest commercial real estate loan
$13.5 million
Commercial Loans
Average size of commercial loan
$275,000
Largest commercial loan
$16.6 million
APPENDIX 2
(Cont’d)
Commercial Portfolio Metrics
Commercial Portfolio Metrics
As of March 31, 2011. |
 NASDAQ: OCFC
24
Commercial Portfolio Segmentation
Commercial Portfolio Segmentation
Construction, 8.9%
Retail Trade, 4.3%
Miscellaneous, 11.6%
Healthcare, 5.5%
Accommodations/
Food Services, 6.5%
Wholesale Trade,
7.1%
Arts/Entertainment/
Recreation, 9.1%
Manufacturing, 5.3%
Real Estate
Investment, 33.1%
Educational Services,
4.1%
Other Services, 4.5%
Total Commercial Loan Exposure
by Industry Concentration
Real Estate Investment by
Property Concentration
Office, 31.8%
Multi-Family, 8.3%
Land, 4.3%
Commercial
Development, 1.0%
Residential
Development, 8.1%
Miscellaneous, 10.0%
Retail Store, 8.5%
Industrial/
Warehouse, 18.6%
Shopping Center, 9.4%
As of March 31, 2011.
APPENDIX 2
(Cont’d) |