Oceanfirst Financial Corp. · NASDAQ:OCFC

Oceanfirst Financial — Q1 2025 Earnings Presentation

28 slides from Oceanfirst Financial's earnings presentation, Apr 24, 2025

  1. Slide 1: 1Q 2025 Earnings Release Supplement

    . . . (1) The 1Q 2025 Earnings Release Supplement should be read in conjunction with the Earnings Release furnished as Exhibit 99.1 to Form 8-K filed with the SEC on April 24, 2025. Exhibit 99.2 OceanFirst Financial Corp. 1Q 2025 Earnings Release Supplement(1) April 2025

  2. Slide 2: Legal Disclaimer

    . . .Legal Disclaimer FORWARD LOOKING STATEMENTS. In addition to historical information, this presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on certain assumptions and describe future plans, strateg

  3. Slide 3: Overview of OceanFirst

    . . .Overview of OceanFirst 3 Tailored Footprint Across Key Markets Corporate Overview & Market Data Ticker OCFC (NASDAQ) HQ Red Bank, NJ Branch Network 39 branches; 8 commercial banking centers Core Markets New Jersey, New York City, Greater Philadelphia Expansion Markets Boston and Washington DC B

  4. Slide 4: Proven Historical Net Interest Income and Loan Growth

    . . .Proven Historical Net Interest Income and Loan Growth 4 120,262 169,218 240,502 255,971 312,951 305,338 377,477 369,731 334,035 86,652 3.46% 2016 3.52% 2017 3.71% 2018 3.62% 2019 3.16% 2020 2.93% 2021 3.37% 2022 3.02% 2023 2.72% 2024 2.90% 351,422 Q1-25 Net Interest Margin YTD Net Interest Inco

  5. Slide 5: Successful Commercial Loan Growth and Geographic Diversification

    . . .Successful Commercial Loan Growth and Geographic Diversification 5 48% 68% 2016 Q1-25 +20% (Commercial % of Loan Portfolio) Commercial Loans by Geography(1) as of Q1-25 Emphasis on Commercial Increase of $5.0B in commercial loans since 2016 Total: $6.8B (1) Based on location the loan is managed

  6. Slide 6: Balanced Approach to Deposit Pricing and Growth

    . . .Balanced Approach to Deposit Pricing and Growth 6 Deposit Composition ($’millions) 646 867 937 1,373 775 1,542 2,445 2,081 2,120673 661 877 898 1,491 1,608 1,488 1,399 1,066 1,052 784 736 714 1,022 1,301 1,337 1,627 1,954 2,350 2,539 3,647 4,202 3,830 3,912 4,001 4,007 783 757 1,151 1,377 2,133

  7. Slide 7: Conservative Credit Risk Profile

    . . .Conservative Credit Risk Profile 7 0.05% 2017 0.09% 0.01% 0.03% 0.13% 0.05% 2018 0.05% 0.08% 0.00% 0.12% 0.04% 2019 0.14% 0.17% 0.02% 0.11% 0.03% 2020 0.02% 0.10% 0.00% 0.07% 0.02% 2021 0.07% 0.04% 0.00% 0.06% 0.02% 2022 0.18% 0.00% 0.05% 0.02% 2023 0.10% 0.04% 0.00% 0.10% 0.03% 2024 0.16% 0.04

  8. Slide 8: Operational Efficiency

    . . . 85 118 127 147 185 250 345 347 344 341 7 8 9 9 12 13 13 14 14 14 0 2 4 6 8 10 12 14 16 18 20 0 50 100 150 200 250 300 350 400 2016 2017 2018 2019 2020 2021 2022 2023 2024 Q1-25 Assets per Branch Assets per FTE Operational Efficiency 8 Deposits per Branch ($’millions) 8 bps1.88% 1.96% 2016 Annu

  9. Slide 9: Business Model Strength Driving Significant Capital Return

    . . .Business Model Strength Driving Significant Capital Return 9 $12.33 $0.49 $0.55 $1.01 $13.67 2015 $1.04 $1.55 $12.94 2016 $1.09 $2.15 $13.58 2017 $1.39 $2.77 $14.26 2018 $1.97 $3.45 $15.13 2019 $2.25 $4.13 $14.98 2020 $2.86 $4.81 $15.93 2021 $2.98 $5.55 $17.08 2022 $2.98 $6.35 $18.35 2023 $3.35

  10. Slide 10: Quarterly

    . . . 10 Quarterly Earnings Update

  11. Slide 11: Q1-25 Financial Highlights

    . . .Q1-25 Financial Highlights 11 (1) For non-GAAP financial measures, please refer to the ‘Non-GAAP Reconciliations’ in the Appendices for a reconciliation to GAAP financial information. (2) CET1 ratio represents an estimate as of Q1-25. Financial Highlights $0.35 Core Diluted EPS(1) $87 million N

  12. Slide 12: Premier Bank Launch

    . . .Premier Bank Launch 12 Business Model Multi-Year Aspiration Goals Performance To Date • Relationship driven, team-based approach to service, resulting in superior high-touch client experience. • Differentiated Commercial Organic Deposit Channel leveraging our existing infrastructure and product

  13. Slide 13: Loan Portfolio Trends

    . . .Loan Portfolio Trends 13 Moderated Loan Growth in the Portfolio ($’millions)  Total loan pipeline increased $198 million, driven by $178 million growth (or 90%) in the commercial loan pipeline. 5,323 5,325 5,273 5,288 5,200 915 858 842 902 897 677 616 661 648 749 2,965 2,978 3,003 3,050 3,053

  14. Slide 14: Diversified CRE Portfolio with Conservative Risk Profile

    . . .Diversified CRE Portfolio with Conservative Risk Profile  Underlying collateral is diversified.  Low concentration in the Multi-Family portfolio, which represents 6% of total assets.  Maturity wall is modest and has a minimal impact: Our CRE Investor- Owned maturity wall, totaling $1.20 bill

  15. Slide 15: Quarterly Credit Trends (1 of 2)

    . . . Strong asset quality trends driven by prudent growth and strong credit risk management Quarterly Credit Trends (1 of 2) 15 Non-Performing Loans and Assets ($’000)(1) Special Mention and Substandard Loans ($’000) Note #1: At March 31, 2025, of the Special Mention loans and Substandard loans rep

  16. Slide 16: Quarterly Credit Trends (2 of 2)

    . . .Quarterly Credit Trends (2 of 2) 16 Loan Allowance for Credit Losses (ACL) Plus PCD & General Credit Marks / Total Loans NCOs / (Recoveries) and Provision for Credit Loss Expense ($’000) 0.07% 0.66% Q1-24 0.06% 0.69% Q2-24 0.06% 0.69% Q3-24 0.06% 0.73% Q4-24 0.05% 0.78% Q1-25 0.73% 0.75% 0.75%

  17. Slide 17: Track Record of Strong Credit Performance

    . . . COVID-19 Pandemic Track Record of Strong Credit Performance 17  From 2006 to Q1-25, inclusive of the Global Financial Crisis, Hurricane Sandy, and the COVID-19 Pandemic, OCFC’s NCO to average loans totaled 13 bps per year compared to 74 bps for all commercial banks between $10 - $50 billion i

  18. Slide 18: Deposit Trends

    . . .Deposit Trends 18 (1) Deposit beta is calculated as the increase in rate paid on total deposits per quarter divided by the incremental increase in the fed funds rate since January 1, 2022. Up cycle is the period from January 1, 2022 to June 30, 2024. The down cycle is from July 1, 2024 to March

  19. Slide 19: Net Interest Income and Net Interest Margin Trends

    . . .Net Interest Income and Net Interest Margin Trends 19 (1) Core NIM excludes purchase accounting and prepayment fee income. Core NIM(1) vs NIM NIM Bridge 2.81% 2.77% Q1-24 2.71% 2.67% Q2-24 2.67% 2.65% Q3-24 2.69% 2.69% Q4-24 2.90% 2.87% Q1-25 NIM Core NIM Net Interest Income ($’000) 86,224 Q1-2

  20. Slide 20: Expense Discipline and Focused Investment

    . . . Core Efficiency Ratio (1) Expense Discipline and Focused Investment 20 Core Non-Interest Expense (1) ($’000) 7,761 8,377 9,512 10,328 9,081 2,732 2,161 1,970 2,620 2,425 5,956 6,018 5,940 6,366 6,647 2,717 2,685 2,618 2,517 2,983 6,329 6,243 6,183 6,306 6,418 32,759 33,136 35,844 36,602 36,740

  21. Slide 21: Generating Consistent Returns

    . . .Generating Consistent Returns 21 Book Value and Tangible Book Value per Common Share ($)(1) Core ROAA(1), ROTE(1), and ROTCE(1) • Tangible book value per common share increased by $0.53 (or 3%) compared to the same quarter last year. • Capital remains strong and above “well capitalized” levels.

  22. Slide 22: Management Q2-25 Outlook

    . . .Management Q2-25 Outlook 22 Loans Deposits Operating Expenses Net Interest Income • We expect mid-single digit growth in Q2-25. • Maintain loan-to-deposit ratio ~100% for the entire year. Mid-single digit annualized growth in Q2-25 Growth consistent with loan growth Increase to run-rate Stable

  23. Slide 23: Appendix

    Appendix 23 @ OcEANFiRSsT

  24. Slide 24: Conservative Risk Profile of CRE IO Office & Construction

    . . .Conservative Risk Profile of CRE IO Office & Construction 24 Portfolio Highlights  96% of Office & Construction loans are pass-rated (not classified or criticized).  93% of Office & Construction loans are classified as non-Central Business District loans.  CBD loans comprise < 1% of total as

  25. Slide 25: Northeast Outperforms Through Credit Cycles

    . . . 0.29% 0.32% 0.51% 0.63% 0.80% 1.43% Northeast Midwest Mid Atlantic Southeast Southwest West COVID-19 Pandemic Hurricane Sandy Global Financial Crisis Northeast Outperforms Through Credit Cycles… 25  Historically, net charge-offs for Northeastern headquartered banks have greatly outperformed m

  26. Slide 26: With a Similar Story in Commercial Real Estate Portfolios

    . . . Hurricane Sandy Global Financial Crisis COVID-19 Pandemic …With a Similar Story in Commercial Real Estate Portfolios 26 0.03% 0.04% 0.09% 0.10% 0.11% 0.16% Northeast Southwest Southeast Mid Atlantic Midwest West GFC Peak CRE NCOs 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

  27. Slide 27: Non-GAAP Reconciliations (1 of 2)

    . . .Non-GAAP Reconciliations (1 of 2) 27 Non-GAAP Reconciliation For the Three Months Ended $'000 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 Core Earnings: Net income available to common stockholders (GAAP) 20,505 20,905 24,112 23,369 27,663 (Less) add non-recu

  28. Slide 28: Non-GAAP Reconciliations (2 of 2)

    . . .Non-GAAP Reconciliations (2 of 2) 28 Non-GAAP Reconciliation $'000 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 Tangible Equity Total stockholders' equity 1,709,117 1,702,757 1,694,508 1,676,669 1,665,837 Less: Goodw ill 523,308 523,308 506,146 506,146 506,14

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