Oceanfirst Financial Corp. · NASDAQ:OCFC
Oceanfirst Financial — IPO Roadshow (September 2016)
42 slides from Oceanfirst Financial's IPO roadshow presentation, Sep 15, 2016
Slide 1: Investor Presentation September 2016
Investor Presentation September 2016 OceanFirst Financial Corp. 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Issuer Free Writing Prospectus Dated September 14, 2016 Filed Pursuant to Rule 433 Registration Statement No. 333-213487
Slide 2: Offering Disclosure
Offering Disclosure This presentation has been prepared by OceanFirst Financial Corp. (“OceanFirst” or the “Company”) solely for informational purposes based on information regarding its operations, as well as information from public sources. This presentation has been prepared to assist interested
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures In addition to financial measures presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this presentation contains certain non-GAAP financial measures. These non-GAAP financial measures adjust GAAP financial m
Slide 4: Terms of Proposed Offering
Terms of Proposed Offering 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Issuer OceanFirst Financial Corp. (NASDAQ: OCFC) Security Fixed-to-Floating Subordinated notes due 2026 Size $35.0 million Term 10 years Covenants Consistent with regulatory requirements for Tier 2 Capital U
Slide 5: Agenda
Agenda OceanFirst Financial Corp. Franchise Overview Capital Overview Credit and Asset Quality Funding and Liquidity Summary and Terms Appendix 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 6: Franchise Overview
OceanFirst Financial Corp. Franchise Overview 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 7: OceanFirst Financial Corp. Snapshot
OceanFirst Financial Corp. Snapshot 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 OceanFirst did not disclose holding company regulatory capital ratios until December 31, 2015. Estimated pro forma company financial information as of June 30, 2016. Pro forma leverage ratio using p
Slide 8: OceanFirst Milestones – Years of Growth
OceanFirst Milestones – 114 Years of Growth 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 $144mm ¹ Total assets of the target at the time of announcement. $1.1 bn ¹ $1.6 bn ¹
Slide 9: Experienced Leadership Team
Experienced Leadership Team 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 # of Years at # of Years Previous Name Position OCFC in Banking Experience Christopher D. Maher President, Chief Executive Officer 3 28 Patriot National Bancorp; Dime Community Bancshares Michael J. Fitzpat
Slide 10: Deep Bench of Experienced Executives
Deep Bench of Experienced Executives 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 # of Years at # of Years Previous Name Position OCFC in Banking Experience Craig C. Spengeman Executive Vice President, Director of Wealth Management 2 38 PGB Trust and Investments (Division of Pea
Slide 11: Board of Directors
Board of Directors 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Name Biography John R. Garbarino Chairman of the Board Chairman of the Board since 1995 Served as CEO from 1995 to 2015 and President from 1995 to 2010 Christopher D. Maher President & CEO President and CEO of Ocean
Slide 12: Ownership Profile
Ownership Profile 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Institutional Ownership¹ Insider Ownership Ownership Overview Substantial Insider Ownership of 14.3%¹ OceanFirst ESOP = 5.8%¹ Directors & Senior Executive Officers 4.2%¹ Director and Proxy Officer Stock Ownership Gui
Slide 13: Branch Network
Branch Network 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 - OSHC (11) - OCFC (50) Combined entity would rank as²: #1 bank headquartered in central and southern NJ #4 bank headquartered in NJ on a pro forma basis Excludes financial institutions headquartered outside of New Jers
Slide 14: Acquisition of Ocean Shore Holding Co.
Acquisition of Ocean Shore Holding Co. 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Deposit market share data as of June 30, 2015 Financial highlights as of or for the quarter ended June 30, 2016 Valued at $146 million – 80% stock, 20% cash Price/TBV – 132% Core Deposit Premium
Slide 15: Financial Performance: Consistent Growth
Financial Performance: Consistent Growth 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Total Assets ($Bn) Total Loans ($Bn) Tangible Common Equity ($mm) Estimated pro forma company financial information as of 6/30/2016.
Slide 16: Financial Performance: Profitability
Financial Performance: Profitability 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Core Net Income ($mm)¹ Core Efficiency Ratio² Core ROATCE¹ Core ROAA¹ Core Diluted EPS¹ Core net income defined as net income after taxes less gain (loss) on the sale of available for sale securiti
Slide 17: Capital Overview
Capital Overview 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 18: Capital Ratios and Balances
Capital Ratios and Balances 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Tier 1 Common Capital (CET1) Ratio (%) Tier 1 Ratio (%) Total Capital Ratio (%) Leverage Ratio (%) ² Estimated pro forma company financial information as of 6/30/2016. Leverage Ratio as of Q2 2016 using per
Slide 19: Pro Forma Capitalization
Pro Forma Capitalization 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Assumes $35 million subordinated debt issuance, net of underwriting fees, and 20% risk weighting on net proceeds. Estimated pro forma holding company capital ratio as of June 30, 2016. Leverage Ratio using per
Slide 20: Credit and Asset Quality
Credit and Asset Quality 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 21: Credit Metrics Reflect Conservative Credit Culture
Credit Metrics Reflect Conservative Credit Culture 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Net charge-off ratio for 2014 excludes charge-off related to bulk sale of non-performing residential and consumer mortgage loans. Including this charge-off, the ratio is 0.45%. Note:
Slide 22: Diversified Loan Portfolio
Diversified Loan Portfolio 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Note: Financial data reflects GAAP financial information as of June 30, 2016.
Slide 23: Atlantic City Exposure
Ocean Shore (Atlantic City) Pro Forma Company1 (Atlantic City) Direct Exposure (Collateral) (Residential + Consumer + Commercial Loans) $M % of Total Loans % of Total Pro Forma Loans Total 19.6 2.5 1.5 Indirect Exposure (Cash Flows) (Residential + Consumer Loans to Casino Workers) # $M 2 % % All Cas
Slide 24: CRE Overview
CRE Overview: $1,532 Million 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Peer Group Average: 368% Note: CRE loans (construction, multi-family and other non-farm non-residential loans) to Total Risk-Based Capital represents primary subsidiary data at June 30, 2016; Supervisory g
Slide 25: Residential Real Estate Portfolio
Residential Real Estate Portfolio Size $1.13 billion % of Total Loan Portfolio 36.2% Average Size of Mortgage Loans $198,000 % of loans for second homes 11.9% Portfolio Weighted Average Loan-to-Value Ratio (using original or most recent appraisal) - Loans originated during 2016 52% 65% Portfolio Ave
Slide 26: Duration Rate Characteristics
Duration Rate Characteristics All asset categories managed with limited duration Effective Interest Rate Risk Management Note: Financial information as of June 30, 2016.
Slide 27: Loan Credit Portfolio Summary
Loan Credit Portfolio Summary 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Risk Category By Portfolio Segment: CRE and C&I Residential and Consumer Loans¹ Excludes PCI loans $ in thousands As of June 30, 2016 Special Pass Mention Substandard Doubtful Total Commercial Real Estate
Slide 28: Asset Quality Trends
Asset Quality Trends 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 NPAs¹ / Assets (%) NCOs / Average Loans (%) Reserves / Loans (%) Texas Ratio³ (%) Nonperforming assets defined as nonaccrual loans and leases and real estate owned. The loans acquired from Cape and Colonial were r
Slide 29: Acquisition of Ocean Shore: Due Diligence & Conservative Credit Mark
Acquisition of Ocean Shore Holding Co.: Comprehensive Due Diligence & Conservative Credit Mark 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Ocean Shore’s disciplined credit standards and conservative underwriting have resulted in pristine asset quality performance Limited exposu
Slide 30: Funding and Liquidity
Funding and Liquidity 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 31: Deposit Composition Trends
Deposit Composition Trends 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Note: Financial data reflects GAAP financial data as of June 30, 2016.
Slide 32: Net Interest Margin
Net Interest Margin 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 33: Historical Interest Coverage
Historical Interest Coverage 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Interest Rate of 5.50% is an assumed rate used for illustrative purposes. Estimated bank-level and consolidated pro forma equity balances for acquisition of OSHC as of 6/30/16. Core pre-tax income defined
Slide 34: Summary and Terms
Summary and Terms 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 35: Terms of Proposed Offering
Terms of Proposed Offering 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Issuer OceanFirst Financial Corp. (NASDAQ: OCFC) Security Fixed-to-Floating Subordinated notes due 2026 Size $35.0 million Term 10 years Covenants Consistent with regulatory requirements for Tier 2 Capital U
Slide 36: Why OceanFirst?
Why OceanFirst? 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Fundamental franchise value Consistent commercial loan growth Conservative credit culture Conservative interest rate risk profile Superior deposit profile Solid financial performance Consistent earnings trends Strong b
Slide 37: Appendix
Appendix 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 38: Non-GAAP Reconciliation: Core Net Income & Performance Ratios
Non-GAAP Reconciliation: Core Net Income & Performance Ratios 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Revenue Adjustments include net gain on sale of loan servicing. Expense Adjustments include merger related expenses, FHLB prepayment fees, severance related expenses, and o
Slide 39: Non-GAAP Reconciliation: Core Efficiency Ratio
Non-GAAP Reconciliation: Core Efficiency Ratio 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128 Expense Adjustments include merger related expenses, FHLB prepayment fees, severance related expenses, and other expenses. Core Efficiency Ratio defined as noninterest expense before fore
Slide 40: Non-GAAP Reconciliation: Tangible Common Equity
Non-GAAP Reconciliation: Tangible Common Equity 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 41: Income Statement
Income Statement 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128
Slide 42: Balance Sheet
Balance Sheet 49 133 156 147 205 221 31 73 125 255 204 102 75 172 198 0 128 128