Slide 1: OceanFirst Financial Corp. 2Q 2022 Investor Presentation
. . . 1 The 2Q 2022 Investor Presentation should be read in conjunction with the Earnings Release furnished as Exhibit 99.1 to Form 8-K filed with the SEC on July 28, 2022. Exhibit 99.2 OceanFirst Financial Corp. 2Q 2022 Investor Presentation1 July 2022
Slide 2: Legal Disclaimer
. . .Legal Disclaimer FORWARD LOOKING STATEMENTS. In addition to historical information, this news release 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
Slide 3: Strategic and Operational Focus
. . .Strategic and Operational Focus 3 Outstanding and Proven Growth Efficiency Cost Model Focused on Investment in Technology Efficient Funding Base and Competitive Spreads Strategic Capital Utilization Significant top-line revenue growth driven by robust loan growth. Optimized branch network by re
Slide 4: Second Quarter 2022 Financial Highlights
. . .Second Quarter 2022 Financial Highlights 4 Performance Year-over-Year (1) Core metrics exclude merger related expenses, net branch consolidation expenses, net loss/gain on equity investments, and the income tax effect of these items, (collectively referred to as “non-core” items). TBV (tangible
Slide 5: Proven Historical Net Interest Income and Loan Growth
. . .Proven Historical Net Interest Income and Loan Growth 5 76,829 120,262 169,218 240,502 255,971 312,951 305,338 175,024 3.71% 3.16% 20162015 2017 2018 3.25% 3.46% 2021 3.52% 3.62% 2019 2020 2.92% 3.24% Q2-22 351,010 Net Interest Margin YTD Jun-22 Annualized Net Interest Income Peer Leading Net I
Slide 6: Successful Commercial Loan Growth
. . .Successful Commercial Loan Growth 6 Q2-22 49% 68% 2015 +19% (Commercial % of Loan Portfolio) Commercial Loans by Geography as of Q2-22 54% of commercial loans originated in Philadelphia and NY Emphasis on Commercial Increase of $5.5B in commercial loans since 2015 41% 32% 22% 5% New Jersey New
Slide 7: Continued Focus on Growing Core Deposits
. . .Continued Focus on Growing Core Deposits1 7 Shift Toward Non-Interest Bearing Deposits ($’millions) 1,661 3,542 3,736 4,948 5,393 8,055 8,958 8,331647 607 866 936 1,373 775 1,500 255 20202015 20212016 20192017 2018 Q2-22 6,329 1,916 4,189 4,343 5,814 9,7339,428 9,831 CoreNon-Core (1) Core depos
Slide 8: Expense Discipline and Focused Investment
. . . Core Efficiency Ratio1 Expense Discipline and Focused Investment 8 Core Non-Interest Expense1 ($’000) 40,752 43,222 43,126 42,802 41,721 10,446 11,212 13,971 12,326 12,992 54,434 Q4-21Q2-21 51,198 Q3-21 3,206 Q1-22 Q2-22 57,097 55,128 57,919 Trident Other Core Non-Int ExpTechnology Expense 57.
Slide 9: Core Non-Interest Income Expansion Opportunity
. . .Core Non-Interest Income1 Expansion Opportunity 9 Q2-22 non-interest income included the Company’s first full quarter of Trident operations, which generated $4.5 million of non-interest income in the quarter. We anticipate Trident run- rate fee income of $3 – $5 million per quarter. Startin
Slide 10: Operational Efficiency
. . .Operational Efficiency 10 Deposits per Branch ($’millions) (60) bps2.39% 1.79% 2015 Q2-22 Core Non-interest Expense1 to Total Avg. Assets (Annualized) 71 69 94 99 113 152 207 259 Q2-2220202015 2016 2017 2018 2019 2021 3.6x Operating Efficiency ($’millions) Branch optimization fully completed by
Slide 11: Growth in Net Interest Margin
. . .Growth in Net Interest Margin 11 Asset-sensitive balance sheet well-positioned for rising interest rates. Average loan growth since Q4-21 totaled ~$414MM and the loan pipeline of $385MM remains strong at June 30, 2022. In addition, end of period loan balances are $176MM higher than average
Slide 12: Generating Consistent and Attractive Returns
. . .Generating Consistent and Attractive Returns 12 Book Value and Tangible Book Value per Common Share ($)1 Core ROAA and ROTE1 • Tangible book value per common share increased by $0.02 per share versus Q1-22. • Repurchased 272,779 shares in Q2-22; 2.9 million shares remain available for repurchas
Slide 13: Business Model Strength Driving Significant Capital Return
. . .Business Model Strength Driving Significant Capital Return 13 $0.49 $1.01 $1.55 $2.15 $2.77 $3.45 $4.13 $4.81 $5.15 $0.55 $0.94 $1.04 $1.09 $1.39 $1.97 $2.25 $2.86 $2.98 $12.91 $13.67 2015 $12.94 $13.58 2017 $14.26 2018 $20.55 $15.13 2019 $14.98 202020162014 2021 $15.96 Q2-22 $12.33 $12.33 $18.
Slide 14: Appendix
. . . I N V E S T O R P R E S E N T A T I O N 14 Appendix
Slide 15: OCFC's Strong History of Credit Discipline
. . .OCFC’s Strong History of Credit Discipline 15 Global Financial Crisis Net Charge Offs (NCOs) / Avg. Loans (%) Hurricane Sandy (1) Source: S&P Global (2) Proxy and US Bank industry reporting is on a one quarter lag (3) Peer group disclosed in OCFC’s DEF-14A filed 4/26/22. This excludes i) Invest
Slide 16: Conservative Credit Risk Profile
. . .Conservative Credit Risk Profile 16 0.01% 0.10% 0.05% 2020 0.01% 2016 0.08% 0.00% 0.30% 0.21% 0.36% 0.11% 2017 0.03% 0.10% 0.05% 0.13% 2018 2019 0.00% 0.47% Q2-22 0.12% 0.04% 0.29% 0.12% 0.02% 0.03% 0.11% 0.31% 0.12% 0.05% 0.02% 2021 0.07% 0.52% 0.18% 0.22% 0.02% 0.06% 0.35% 0.00% Commercial &
Slide 17: Quarterly Credit Trends (1 of 2)
. . .Quarterly Credit Trends (1 of 2) 17 Loan Allowance for Credit Losses (ACL) Plus PCD & General Credit Marks / Total Loans Net Charge-offs (NCOs) / (Recoveries) and Credit Loss Expense (Benefit) ($’000) 0.72% 0.79% Q3-21Q2-21 0.61% 0.30% 0.26% 0.69% 0.57% 0.22% Q4-21 Q1-22 0.18% 0.56% 0.17% 0.55%
Slide 18: Quarterly Credit Trends (2 of 2)
. . . Strong asset quality trends driven by prudent loan growth and credit decisioning. Quarterly Credit Trends (2 of 2) 18 Non-Performing Loans and Assets ($’000)1 Special Mention and Substandard Loans ($’000) Note: Of the $60.8 million in Special Mention loans and $103.3 million of Substandard loa
Slide 19: Asset Growth Supplemented by Strategic M&A
. . .Asset Growth Supplemented by Strategic M&A 19 ($ in millions) Target Closing Date Transaction Value Total Assets Colonial American Bank July 31, 2015 ~$12 million $142 million Cape Bancorp May 2, 2016 ~$196 million $1,518 million Ocean Shore Holding Co. November 30, 2016 ~$146 million $1,097 mi
Slide 20: Northeast and Mid-Atlantic Expansion Opportunities
. . .Northeast and Mid-Atlantic Expansion Opportunities1 20 • New Jersey is an attractive market. • Statewide total population of 9.3 million. • Most densely populated state. • 11th most populous state. • Median household income of $85,245. • Significant opportunities for acquisitions to build custo
Slide 21: Experienced Management Team with Banking Expertise
. . .Experienced Management Team with Banking Expertise 21 Substantial insider ownership of 11%2, including Directors, Executive Officers, ESOP and OceanFirst Foundation. Executive Title Years Experience1 Select Experience Christopher D. Maher Chairman & Chief Executive Officer 9 • Director of the F
Slide 22: Interest Rate Sensitivity (1 of 2)
. . .Interest Rate Sensitivity (1 of 2) 22 OceanFirst Bank’s balance sheet is asset-sensitive. A measurable upward change in the rate environment could have a positive impact to our net interest income going forward. Economic Value of Equity (EVE)1 - % ChangeEarnings at Risk (EAR)1 - % Change -6 -
Slide 23: Interest Rate Sensitivity (2 of 2)
. . .Interest Rate Sensitivity (2 of 2) 23 Rate Characteristics 77% 92% 55% 49% 63% 15% 85% 23% 45% 51% 37% 85% 15% Commercial Loans (CRE & C&I) Securities 8% DepositsMortgage Loans Consumer Loans Total Assets (Weighted Avg) Borrowings Adjustable/Floating Fixed Core Deposits Note: Data as of 6/30/22