Oceanfirst Financial Corp. · NASDAQ:OCFC
Oceanfirst Financial — Investor Presentation (February 2015)
28 slides from Oceanfirst Financial's investor presentation, Feb 11, 2015
Slide 1: OceanFirst Financial Corp. Investor Presentation
Exhibit 99.1 OceanFirst Financial Corp. Investor Presentation February 2015
Slide 2: Forward Looking Statements
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 for
Slide 3: OceanFirst Bank Milestones
OceanFirst Bank Milestones Rebuilt Capital Founded, Established To 9.5% Through Point Pleasant, Commercial Secondary NJ Lending Stock Offering Established OceanFirst IPO To Trust and Foundation Passes Mutual Asset Management $25 Million In Depositors Cumulative Grants Branch Expansion Branch Expansi
Slide 4: Serving Central New Jersey Market
Serving Central New Jersey Market • Community Bank serving the Central Jersey market - $2.4 billion in assets and 23 branch offices • Targeting growth opportunities in Monmouth, Mercer and Middlesex Counties • Market Cap $280.4 million • Core deposits – 88.0% of total deposits • Locally originated l
Slide 5: Experienced Leadership
Experienced Leadership # of Years in # of Years Name Position Banking at OCFC Christopher D. Maher President, Chief Executive Officer 27 2 Michael J. Fitzpatrick Executive Vice President, Chief Financial Officer 33 22 Joseph R. Iantosca Executive Vice President, Chief Administrative Officer 37 11 Jo
Slide 6: Our Strategy
Our Strategy • Positioned as the leading Community Bank in attractive Central Jersey 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
Slide 7: Significant Primary Market Deposit Share
Significant Primary Market Deposit Share Competing Favorably Against Banking Behemoths # of Dep. In Mkt. Mkt. Shr. Rank Institution Branches ($000) (%) Ocean County, NJ 1 TD Bank, National Association (Canada) 22 2,541,705 17.45 2 Hudson City Bancorp Inc. (NJ) (1) 14 2,212,695 15.19 3 Wells Fargo Ba
Slide 8: Strategic Deposit Composition Transition
Strategic Deposit Composition Transition *Time deposit duration of 19 months 8
Slide 9: Technology and Delivery Systems
Technology and Delivery Systems Corporate Cash Management Online Banking & Bill Pay Mobile Banking Added Remote Deposit Capture In 2014, 42% of depositors used Added mobile deposit capture (RDC) in 2007. In 2014, 88 clients online banking and over 34,000 in 2013. More than 14,000 processed over 600,
Slide 10: Strategic Loan Composition Transition
Strategic Loan Composition Transition (1)Commercial loan (CRE and C&I) duration of 2.75 years. 10
Slide 11: Credit Underwriting Remains Conservative
Credit Underwriting Remains Conservative Commercial Loan Production 2014 2014 Total Commercial Total (Dollars in thousands) Loan Originations Portfolio Amount $243,858 $733,897 Weighted average rate 4.14% 4.49% Weighted average debt service coverage 2.0X 2.0X Weighted average loan-to-value 63% 53% W
Slide 12: Highlights – Fourth Quarter 2014
Highlights – Fourth Quarter 2014 • Grew commercial loan portfolio $54.4 million, 32.0% annualized; 6 th consecutive quarter of double digit percentage growth • Announced the addition of a new commercial lending team to be located in Mercer County, New Jersey • Earnings per share of $0.30, 9.1% ROE &
Slide 13: Highlights – Risk Management
Highlights – Risk Management For the year ended December 31, 2014: • Interest Rate Risk Management Extended $144 million of FHLB advances into 3 – 5 year terms $72 million of retail checking migrated to non-interest bearing Core deposits (1) are 88.0% of total deposits, a significant hedge against a
Slide 14: Credit Metrics Reflect Conservative Culture
Credit Metrics Reflect Conservative Culture Net charge- 0.16% 0.18% 0.57% 0.36% 0.16% 0.14%(1) offs 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2009 2010 2011 2012 2013 2014 Residential Consumer Commercial Real Estate Commercial Note: Atlantic County Loan Exposure totals $11.7 million, or 0.7%,
Slide 15: Prudently Provisioning for Credit Costs
Prudently Provisioning for Credit Costs $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 $0 12/31/09 12/31/10 12/31/11(1) 12/31/12 12/31/13 12/31/14 Net Charge-Offs Net Charge-Offs Attributable to Bulk Sale of NPL's Provision for Loan Losses (1) Spike in charge-offs was due to a change in charge-off policy to recogni
Slide 16: Net Interest Margin
Net Interest Margin Stabilizing Close to Historical Levels Historical Average Net Interest Margin (3.28%) 16
Slide 17: Diversified Streams of Non-Interest Income
Diversified Streams of Non-Interest Income 0.90% $17.5M 0.80% 0.70% Targeted Growth 0.60% Areas 0.50% 0.40% 0.30% $2.5M 0.20% 0.10% 0.00% 1996 2014 Fees and Service Charges Gain on Sale of Loans BOLI Other BankCard Services Investment Services Wealth Management Non-Interest Income excludes gain/loss
Slide 18: Generating Consistent Attractive Returns
Generating Consistent Attractive Returns 14.0% 1.40% 12.0% 1.20% 10.0% 1.00% 8.0% 0.80% 6.0% 0.60% 4.0% 0.40% 2.0% 0.20% 0.0% 0.0% (1) 2009 2010 2011 2012 2013 2014 Return on Equity Return on Assets (1) Excludesafter-taximpact of $3.1millionin non-recurringchargesrelated to strategicadvancerestructu
Slide 19: Prudently Managing Excess Capital in Near Term
Prudently Managing Excess Capital in Near Term $25.0 $20.0 $15.0 $10.0 $5.0 $0.0 2011 2012 2013 2014 Cash Dividends Stock Repurchases Notes: Stock Repurchases – $14.97 Average Cost per Share. Quarterly dividend rate increased by $0.01, or 8.3%, in October 2014. 19
Slide 20: Challenge Today is to Grow Revenue, Build Shareholder Value
Challenge Today is to Grow Revenue Build Shareholder Value • Target growth in broader central New Jersey market – increasing share In early 2015, added new commercial lending team located in Mercer County Commercial loans increase at double digit percentage growth rate for six consecutive quarters S
Slide 21: Why OCFC…?
Why OCFC…? • Fundamental franchise value – superior deposit profile and consistent, conservatively underwritten, commercial loan growth • Seasoned and effective management team Substantial insider ownership – aligned with shareholders’ interests Successful CEO transition • Conservative credit cultur
Slide 22: Attractive Valuation Metrics
Attractive Valuation Metrics OCFC Peers (1) Valuation Price / Tang. Book Value 128% 145% Price / LQA EPS 13.8x 14.9x Price / Estimated EPS 12.9x 13.4x Core Deposit Premium 3.7% 6.8% Cash Dividend Yield 3.1% 3.1% 1) Peers include: DCOM, FFIC, FLIC, LBAI, ORIT, PGC, SNBC, SUBK, UVSP and WSFS Note: Fin
Slide 23: Appendix
Appendix 23
Slide 24: Market Demographics
APPENDIX 1 Market Demographics Ocean Monmouth Middlesex Mercer National Number of Offices 19 4 1 % of OceanFirst Deposits 86.2 10.9 2.9 Market Rank 4 17 35 Market Share (%) 10.2 0.9 0.2 Population 583,000 628,000 831,000 369,000 Projected 2014-2019 1.4 — 3.0 1.2 3.5 Population Growth (%) Median Hous
Slide 25: Commercial Portfolio Metrics
APPENDIX 2 Commercial Portfolio Metrics Commercial Real Estate (CRE) Total portfolio (1) $650.0 million % of Total Loan Portfolio 37.7% Average size of CRE loans $871,000 Largest CRE loan $15.5 million Current Pipeline $40.0 million Weighted Average Yield 4.42% Weighted Average Repricing Term 6.5 ye
Slide 26: Commercial Portfolio Segmentation
APPENDIX 2 (Cont’d) Commercial Portfolio Segmentation Total Commercial Loan Exposure Real Estate Investment by Property Classification by Industry Classification Diversified portfolio provides protection against industry- specific credit events. As of December 31, 2014. 26
Slide 27: Residential Portfolio Metrics
APPENDIX 3 Residential Portfolio Metrics Residential Real Estate Total Portfolio $789.6 million % of Total Loan Portfolio 45.8% Average size of mortgage loans $192,000 % of loans for second homes 9.9% Portfolio weighted average loan-to-value ratio (using original or most recent appraisal) 56% - Loan
Slide 28: Superstorm Sandy Recovery
APPENDIX 4 Superstorm Sandy Recovery • Multi-Year Recovery Horizon 6,234 homes demolished in Monmouth and Ocean in 2013/2014; 54% of New Jersey total Toms River specifically 1,589 homes expected to be demolished (of 30,235 Single Family Homes) 718 permits for $105.6 million issued in 2014 • Construc
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