OceanFirst Financial
Annual Report 2019

Plain-text annual report

OCEANFIRST FINANCIAL CORP. 2019 ANNUAL REPORT AT-A-GLANCE $10.2 $8.2 $7.5 $5.4 $5.2 $2.6 56% 44 % 2015 2016 2017 2018 2019 Jan 2020 Total Assets (in Billions) Loan Portfolio ■ Commercial ■ Consumer January 2020 $10.2 TOTAL ASSETS (in Billions) $7.5 2018 2019 $104.8 CORE NET INCOME* (in Millions) $94.1 2018 2019 $2.07 CORE EPS* $1.98 2018 * Please refer to footnote on page 2. Hunterdon Bucks Mercer Montgomery Chester Delaware s tle a w C e N Philadelphia Burlington Gloucester Camden Westchester Bronx Long Island Essex Union Middlesex Monmouth Ocean Cumberland Atlantic Cape May OceanFirst Financial Corp.’s subsidiary, OceanFirst Bank N.A., founded in 1902, is a regional bank operating throughout New Jersey, greater Philadelphia and metropolitan New York City. OceanFirst Bank delivers commercial and residential financing solutions, trust and asset management and deposit services. OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 1 FINANCIAL SUMMARY (dollars in thousands, except per share amounts) At or for the year ended December 31, 2019 2018 2017 2016 SELECTED FINANCIAL CONDITION DATA Total assets Loans receivable, net Deposits Stockholders’ equity SELECTED OPERATING DATA Net interest income Other income Operating expenses (1) Net income (1) $8,246,145 $7,516,154 $5,416,006 $5,166,917 6,207,680 5,579,222 3,965,773 3,803,443 6,328,777 5,814,569 4,342,798 4,187,750 1,153,119 1,039,358 601,941 571,903 255,971 240,502 169,218 120,262 42,165 34,827 27,072 20,412 189,142 186,337 126,520 102,852 88,574 71,932 42,470 23,046 Diluted earnings per share (1) 1.75 1.51 1.28 0.98 SELECTED FINANCIAL RATIOS AND OTHER DATA(1) Tangible stockholders’ equity per common share at end of period Cash dividends per common share 15.13 0.68 14.26 0.62 13.58 0.60 12.94 0.54 Tangible stockholders’ equity to tangible assets 9.71% 9.55 % 8.42 % 8.30 % Return on average assets (1) Return on average tangible stockholders’ equity (1) Net interest rate spread Net interest margin Operating expenses to average assets (1) Efficiency ratio (1) Non-performing loans as a percent of total loans receivable 1.10 11.96 3.40 3.62 2.35 63.44 0.29 0.98 11.16 3.57 3.71 2.53 67.68 0.31 0.80 9.82 3.44 3.53 2.39 64.46 0.52 0.62 7.13 3.38 3.47 2.76 73.11 0.35 (1) Amounts and performance ratios for 2019 include merger related expenses, branch consolidation expenses, non-recurring professional fees, compensation expense due to the retirement of an executive officer, and the reduction in income tax expense from the revaluation of state deferred tax assets as a result of a change in the New Jersey tax code of $20.6 million with an after tax cost of $16.3 million. Amounts and performance ratios for 2018 include merger related expenses, branch consolidation expenses, and an income tax benefit related to Tax Reform of $28.2 million with an after tax cost of $22.2 million. Amounts and performance ratios for 2017 include merger related expenses, branch consolidation expenses, and additional income tax expense related to Tax Reform of $18.1 million with an after tax cost of $13.5 million. Amounts and performance ratios for 2016 include merger related expenses and the Federal Home Loan Bank advance prepayment fee totaling $16.7 million with an after tax cost of $11.9 million. 2 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report Christopher D. Maher (left) Chairman of the Board President and Chief Executive Officer Joseph J. Lebel III (right) Executive Vice President and Chief Operating Officer DEAR FELLOW SHAREHOLDERS, As we write this, people around the world are grappling with the unprecedented disruption caused by the global COVID-19 outbreak. While the ultimate impact of the pandemic is unpredictable, we believe this is a time for organizations like OceanFirst to demonstrate strength, compassion and leadership—to help our families, friends, neighbors and communities through this critical period and on to a robust recovery. The Company took early and decisive action, activating a Pandemic Response Plan in February 2020. Our actions included measures to support our customers, employees, shareholders and the broader community. Prioritizing the health and safety of our customers and employees, we adopted sanitary and social distancing practices Company-wide, as recommended by public health authorities. Also, we temporarily eliminated lobby services at all branches and shifted to drive-up service for most branches, while continuing to assist customers through our Digital Banking and Call Center operations. We instituted Borrower Relief Programs to enable business and consumer borrowers most severely affected by COVID-19 to defer certain loan payments and access additional credit. With the tireless efforts of our lending and credit teams, we quickly implemented the CARES Act Paycheck Protection Program, responding to inquiries from more than 2,000 clients. We expect to originate over $500 million in these SBA loans during the second quarter. For our employees, we created a “bank” of paid time off hours to be used in the event of quarantine, isolation, family care needs or other circumstances related to COVID-19. OceanFirst Foundation established a grant pool to support non-profit organizations that were directly impacted by COVID-19. OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 3 We also acted decisively to protect our shareholders by ensuring the continued operation of our Company. MANAGING THROUGH CHALLENGING TIMES The emergence of COVID-19 underscores These actions included dispersing critical operations an important point: while we strive at all times across several Company locations and providing to create value for OceanFirst’s stockholders, additional IT resources to enable team members these efforts do not take place in a vacuum. to work remotely. Where possible, we have repriced assets and liabilities and taken other balance sheet initiatives to offset net interest margin compression. And we are proactively monitoring our loan portfolio to identify industries, loan types and borrowers that may be at risk from the economic impact of COVID-19. Reflecting our responsibility to our shareholders, we held an investor briefing on March 24th to outline our response and address investor questions regarding the potential impact of the pandemic on our business. We are proud of the way our teammates have “stepped up” throughout this challenging time. Our experience during other periods of extreme hardship, such as Superstorm Sandy, is that such efforts represent a vital lifeline that helps our customers, employees and neighbors—and our Company—stay resilient and come back stronger. Our clients will long remember OceanFirst’s early and decisive action to protect our community. As with all businesses, our operating environment is affected by a variety of economic forces. In addition to concerns that the pandemic may push the US and world economies into a recession, the Federal Reserve’s strategies, while necessary, have produced historic low interest rates that have a negative impact on financial institutions’ margins. While a global health crisis was unanticipated, our disciplined approach to risk management has prepared the Company for a wide variety of economic stresses, including the current environment. We have worked diligently to build a strong balance sheet heading into this potentially difficult economic period. As of year-end 2019, this strength was evidenced by a very healthy tangible capital ratio of 9.7% and remarkably low levels of non- performing assets, which totaled just 0.22%. ) % ( l e b a v i e c e R s n a o L / s f f O - e g r a h C t e N 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 0.60 0.50 0.40 0.30 0.20 0.10 0.00 ) % ( s t e s s A l a t o T / s t e s s A i g n m r o f r e P - n o N NPA/TA Net Charge Offs 2016 2017 2018 2019 4 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report $18.00 $16.00 $14.00 $12.00 $12.94 $10.00 8.30% $8.00 $6.00 9.71% $15.13 10.0% 9.5% 9.0% 8.5% 8.0% 7.5% 2016 2017 2018 2019 ) % ( y t i u q E n o m m o C l i e b g n a T Tangible Stockholders’ Equity to Tangible Assets Tangible Stockholders’ Equity per Common Share at End of Period ) $ ( e r a h S r e P e u a V l k o o B e b g n a T i l Further, net charge-offs during 2019 totaled just 0.02%, an exceptionally low level. If the current disruption persists, charge-offs and non-performing assets are likely to increase industry-wide, but our starting point is much stronger than many peers, providing a wider array 2019: DELIVERING ON OUR POTENTIAL OceanFirst’s efforts to deliver performance and value to shareholders, provide unparalleled service to customers, create a rewarding work- place for team members, and support thriving communities met with noteworthy success in 2019. of strategic options. In addition, our dividend payout Our financial results benefitted from record loan ratio of just 33% of core earnings in 2019 allowed originations, a solid increase in deposits, and strong us to build tangible book value, deploy capital in growth in GAAP earnings, core earnings, and EPS. value-creating acquisitions, and repurchase 1.1 We strengthened our market presence by launching million shares. This modest dividend payout ratio regional banking operations in New York City and also provides additional flexibility as industry-wide margins come under pressure. In summary, we believe OceanFirst is strong— in capital, purpose and spirit. We are confident that the value we are building for the long-term will endure well beyond the present short-term market and economic headwinds. In the balance of this year’s annual report, we want to talk about our performance in 2019, as well as our strategies to deliver sustainable Philadelphia and executed the acquisition of three additional banks. These acquisitions substantially strengthened our position as the leading bank in central and southern New Jersey and supported our expansion into New York. We continued to invest in talent and technology, to stay ahead of our customers’ needs in a fast-changing financial marketplace. And, true to our community bank culture, we worked to improve the lives of our neighbors and friends by supporting local non-profit organizations both financially and growth, the value of our community bank culture, through the volunteer efforts of our colleagues. our approach to capital deployment, and the qualities that make our region such an attractive place to do business. OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 5 Net income for 2019 on a GAAP basis was $88.6 million, or $1.75 per diluted share, rising from $71.9 million, or $1.51 per diluted share, for the prior year. Core earnings were a record $104.8 million, or $2.07 per diluted share, for 2019, excluding merger related and branch consolidation expenses, certain non- recurring professional fees and compensation expenses, and the effect of a change in New Jersey’s tax code. This was an 11.4% increase over the prior record of $94.1 million, or $1.98 per diluted share, set in 2018. Our earnings power was reflected in strong performance metrics. Core return on average tangible assets for 2019 was 1.37% and core return on average tangible stockholders’ equity was 14.16%. Reflecting our continuing emphasis on expense control, the core efficiency ratio was 55.8% for 2019. Our performance in 2019, as in recent years, reflected well-defined strategies designed to deliver sustainable, profitable growth. Specifically, we aim to build on our core competencies in three key areas: • Successfully driving organic growth. • Executing value-added M&A transactions. • Investing in digital banking innovation and excellence. DRIVING ORGANIC GROWTH, EXPANDING OUR MARKETS OceanFirst’s organic growth is most evident from our record loan originations of $1.5 billion in 2019, which resulted in total loan growth of over $300 million. Both commercial and residential portfolios were strong contributors, with over 13% growth in each category. To provide further opportunities for organic growth, one of our top priorities has been to extend our market footprint into New York and Philadelphia in a meaningful way. We made great strides in this regard in 2019, launching regional banking divisions in New York in March and the Greater Philadelphia area in May. Both regions are led by highly “To provide further opportunities for organic growth, one of our top priorities has been to extend our market footprint into New York and Philadelphia in a meaningful way.” 6 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report experienced Regional Presidents – Daniel Harris in New York and Susanne Svizeny in Philadelphia – who joined the Company to spearhead the efforts in their respective markets. As Daniel and Susanne build their teams and engage with current and prospective customers, we are excited by the potential to expand our commercial relationships, as well as treasury management, retail banking, and trust and asset management services in these vibrant markets. MAKING ACQUISITIONS WORK Complementing our organic growth, OceanFirst has a solid track record of identifying and securing transactions that have enhanced the Company’s scale, market presence, service capabilities, earnings power, and operational efficiency. We have successfully executed seven acquisitions in less than five years, and grew assets from $2.5 billion to $10.2 billion in the process. We believe the key to making these investments work is to be highly selective in identifying prospective M&A candidates, to manage the integration process in a disciplined manner to attain well-delineated objectives, and to respect (and build on) the talent and client relationships gained from our merger partners. We completed three bank acquisitions since last January. The acquisition of Capital Bank was completed on January 31, 2019, adding to our ability to serve the Southern New Jersey and Greater Philadelphia markets through branches in Cumberland, Gloucester and Atlantic counties. Less than one year later, on January 1, 2020, we completed the acquisitions of Two River Bancorp in New Jersey and Country Bank Holding Company, Inc. in New York City. The addition of Two River Daniel Harris President, New York Region Susanne Svizeny President, Greater Philadelphia Region President Harris. Taken together, these transactions will significantly advance our efforts to become a leading community banking institution serving the New Jersey-Philadelphia-New York corridor, which is one of the most extensive banking markets in the US. This combination of organic growth and acquisitions has delivered consolidated assets of $10.2 billion, loans of $7.8 billion, and deposits of $7.9 billion as of January 1, 2020. INVESTING IN INNOVATION enhances our community banking footprint in OceanFirst has been a leader in deploying innovative Monmouth, Ocean, Union and Essex Counties, technology to meet customers’ changing needs in New Jersey. Country Bank provides our first an age of digital business. At the same time, we are physical branch locations in the metropolitan increasingly focused on using automation, data New York market and complements the organic analytics, and artificial intelligence to make our growth effort being led by New York Regional operations more productive and cost-effective. OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 7 EWALLET USAGE 176 % Gro wth R ate For example, we have consolidated 40 branch offices in the past three years, while adding 78 new positions to support our digital banking activities. Our investments in digital products and services are gaining significant traction, as customers are taking increasing advantage of capabilities such as online account opening, mobile banking, P2P transfers, text alerts on account status, and access to eWallet services. In fact, online retail checking account openings are responsible for 8.7% of all account openings. Interactions with video tellers are up 45% since the end of 2018 and are building our experience communicating across an important new servicing channel. Since the 2018 launch of AmiGo, a low-rate checking account product that enables “digital banking on the go,” over 1,000 customers have enrolled. AmiGo has 4Q18 1Q19 2Q19 3Q19 4Q19 demonstrated a strong demand for digitally focused 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 deposit accounts and taught us a great deal about digital direct customer acquisition. In 2020 the AmiGo account will be rolled out in all our markets and rebranded as FreeStyle checking, with the ability to open this digitally-forward account online or in branches. We also have a partnership with and capital investment in Nest Egg, a hybrid “robo-advisor,” which now has over $40 million in assets under administration from almost 1,400 clients. Once again, our customers are choosing newly designed digital account offerings in growing numbers. We believe that OceanFirst’s focus on digital banking excellence is reflected in a high level of customer satisfaction. Our Net Promoter Score, which measures our customers’ willingness to recommend the Bank’s products or services to others, reached an all-time high of 76 in December 2019. Those results place us well ahead of the US banking industry average and even exceed the typical results for credit unions, who often have passionate customer bases. “We believe that OceanFirst’s focus on digital banking excellence is reflected in a high level of customer satisfaction.” 8 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report DIGITAL CUSTOMERS NET PROMOTER SCORES th w o r al G u n n % A 4 6 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2015 2017 2019 BUILDING ON OUR COMMUNITY BANK CULTURE OceanFirst’s strategies to deliver sustained, profitable growth build upon our heritage as a community banking institution. Our ability to provide high-quality financial solutions and exceptional client service is the direct result of our engagement in, knowledge of, and com- mitment to our communities over nearly 118 years. In a financial services marketplace that is being up-ended by technological disruption, industry consolidation, and changing client demands, an enduring culture of community and client service is a significant competitive strength. As a good neighbor and responsible corporate citizen, we actively support the communities where our colleagues and customers live and work. Our WaveMakers program encourages employees to volunteer with community service organizations; last year our colleagues gave over 3,800 hours of their time. For example, a team of employees joined a Habitat for Humanity “Women Build” event in Monmouth County, New Jersey, working alongside construction professionals, other volunteers, and future homeowners to build homes and change lives. 78 69 58 53 NPS* 80 70 60 50 40 30 20 10 0 2016 2017 2018 2019 * Industry average NPS for banking and financial services. The Company provided more than $15 million in community development loans for reinvestment and development projects in 2019. We closed a $10 million credit facility for the Vineland Revolving Loan Fund, a loan pool managed by the Economic Development Department of Vineland, N.J. to stimulate economic activity in the city’s Urban Enterprise Zone. In the Greater Philadelphia area, we worked with Nexus Properties to support a $54 million, mixed use development to serve the community and students at Rowan University. The bank continued its longstanding tradition of providing loans under our First Time homebuyer program, resulting in $3.2 million in new funding, plus almost $1 million more with the First Home Club, for this important customer group. In addition, since its inception in 1996, the OceanFirst Foundation has approved grants totaling more than $40 million to local organizations that promote health and wellness, access to housing, youth development and education, the arts, and the overall quality of life in our communities. OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 9 “Our ability to deliver on this commitment will depend, as always, on the experience, skills and motivation of our people.” DEPLOYING CAPITAL TO CREATE VALUE The “growth investments” noted above reflect OceanFirst’s approach to deploying capital to drive performance and progress. For example, the expansions into New York and Philadelphia required direct investments totaling $2.8 million in 2019. These investments included recruiting seasoned commercial lending talent and providing them the tools to compete in these new markets. In addition, our direct investment in new digital products and the personnel to support them was in excess of $15 million in 2019. chase program for up to an additional 2.5 million shares. In total, through cash dividends and share buybacks, we have returned $167.1 million to our shareholders between 2014 and 2019. With the equity markets in turmoil at the onset of the pandemic, we temporarily ceased share repurchases in February to preserve capital as a resource and provide a source of strength for pandemic relief efforts. SERVING A VIBRANT MARKET The dynamic market we serve is a major contributor to OceanFirst’s value. Despite the current disruptions caused by COVID-19, the economy of the New Jersey- Philadelphia-New York region is robust and resilient. Our recent efforts to expand our regional banking presence have positioned the Company to benefit from this economic powerhouse over the long term. We would be remiss, however, if we failed to mention the attractive opportunities we see in our head- quarters state. New Jersey is something of an overlooked gem, living as it does in the shadow of metropolitan New York and Philadelphia. Contrary to the image some have of New Jersey as a shrinking market, the population grew between 2010 and 2019. It is a well-educated population, with more than 61% of the residents having some college, a Bachelor’s degree or an advanced degree. Furthermore, the economy is diverse and balanced, with key sectors such as pharmaceuticals and life sciences, financial services, advanced manufac- We also are committed to effectively deploying turing, information technology, and transportation/ our shareholders’ capital. In addition to supporting logistics providing much of the growth momentum. organic growth, $46 million of capital was deployed In short, our home state possesses a diverse economy in connection with the Two River Bank acquisition. that provides enormous opportunity to serve the Surplus capital continues to be returned to our financial needs of businesses, individuals and families. shareholders through regular dividends and share repurchases. As a public company, OceanFirst has paid cash dividends for 92 consecutive quarters, DEVELOPING TALENT AND LEADERSHIP OceanFirst is committed to building value for all including $34.2 million in dividends in 2019. We repur- of our stakeholders by continuing the initiatives chased 1.1 million shares of the Company’s common we have talked about here: driving organic growth, stock during the past year, and in December the targeting value-added acquisitions, investing in a Board of Directors authorized a new stock repur- digital future, and prudently managing economic risk. 10 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report Our ability to deliver on this commitment will depend, as always, on the experience, skills and motivation of our people. We are fortunate to be situated in the midst of an exceptional pool of talent in the New Jersey-Philadelphia-New York metropolitan area, which is especially well-suited to the needs of a financial services business in an increasingly technology-driven age. This is a tremendous advantage as we continue to seek to attract, retain and develop the talent we need to maximize our opportunities in a fast-changing financial services marketplace. Angela Ho Chief Accounting Officer We established a Leadership Development and fitness field, Sam is also an active member program in 2019 to build leadership bench strength of several community organizations. Steven Brady, across our organization, with specific modules for formerly the President of Ocean Shore since 1998, emerging talent, mid-level managers, and senior also joined our Board in 2016, where he contributed vice presidents. Our “Women LEAD” (Leadership, valuable insight due to his experience in the local Exploration, Advancement and Development) initiative banking industry and his former membership on provides sponsorship and career development the Philadelphia Federal Reserve Advisory Board. to advance our talent pool of women employees. We thank both Sam and Steve for their distinguished We are particularly proud to acknowledge Angela Ho, service and sound guidance and wish them all the Chief Accounting Officer, who has been recognized best in the future. by American Banker as one of the 2020 Most Powerful Women in Banking NEXT. Other talent development programs include a mentoring program, supervisory training, sales training, and a “managerial boot camp.” We continue to believe that OceanFirst’s community- oriented, innovation-led model provides an excep- tional opportunity to grow shareholder value, deliver superior customer service, create a rewarding workplace, and sustain vital communities. Our efforts We would like to recognize two members of our gain strength from the loyalty of our customers and Board of Directors who are concluding their service shareholders, the integrity and dedication of our to OceanFirst. Samuel Young joined the OceanFirst team members, and the wise counsel of our Board Board as a result of our 2016 acquisition of Ocean of Directors. We thank you and will always strive to Shore Holding Co. An entrepreneur in the health be worthy of your support. Christopher D. Maher Chairman of the Board President and Chief Executive Officer Joseph J. Lebel III Executive Vice President and Chief Operating Officer OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report | 11 OCEANFIRST FINANCIAL CORP. OCEANFIRST BANK BOARD OF DIRECTORS Steven E. Brady Retired Ocean Shore Holding Co. Angelo Catania Retired Homestar Services, LLC Anthony R. Coscia, Esq. Partner Windels Marx Lane & Mittendorf, LLP Michael D. Devlin Retired Cape Bancorp., Inc. Jack M. Farris Retired Verizon Communications, Inc. Kimberly M. Guadagno, Esq. CEO Fulfill Nicos Katsoulis Retired Sun National Bank John K. Lloyd Retired Hackensack Meridian Health Christopher D. Maher Chairman of the Board President and Chief Executive Officer OceanFirst Bank, N.A. William D. Moss Retired Two River Bancorp Joseph M. Murphy, Jr. Retired Country Bank Holding Company, Inc. Steve M. Scopellite Consultant Self-Employed Grace C. Torres Trustee Prudential Retail Mutual Funds Grace M. Vallacchi Executive Vice President Chief Risk Officer OceanFirst Bank, N.A. John E. Walsh Senior Vice President T and M Associates, Inc. DIRECTORS EMERITUS John W. Chadwick John R. Garbarino Robert E. Knemoller Donald E. McLaughlin Diane F. Rhine James T. Snyder OCEANFIRST FINANCIAL CORP. CORPORATE OFFICERS Christopher D. Maher Chairman of the Board President and Chief Executive Officer Michael J. Fitzpatrick Executive Vice President Chief Financial Officer Steven J. Tsimbinos Executive Vice President General Counsel Corporate Secretary Grace M. Vallacchi Executive Vice President Chief Risk Officer Jill Apito Hewitt Senior Vice President Investor Relations Officer Angela K. Ho Senior Vice President Chief Accounting Officer Robert A. Laskowski Senior Vice President Treasurer B. Matthew McCue Vice President Assistant Corporate Secretary OCEANFIRST BANK EXECUTIVE OFFICERS Christopher D. Maher Chairman of the Board President and Chief Executive Officer Joseph J. Lebel III Executive Vice President Chief Operating Officer Michele B. Estep Executive Vice President Chief Administrative Officer Michael J. Fitzpatrick Executive Vice President Chief Financial Officer Anthony Giordano III Executive Vice President Chief Retail Banking Officer Karthik K. Sridharan Executive Vice President Chief Information Officer Steven J. Tsimbinos Executive Vice President General Counsel Grace M. Vallacchi Executive Vice President Chief Risk Officer REGIONAL PRESIDENTS Vincent M. D’Alessandro President, Southern Region George Destafney President, Central Region Daniel J. Harris President, New York Region David R. Howard President, Digital Strategy & Innovation Susanne Svizeny President, Greater Philadelphia Region SENIOR VICE PRESIDENTS A. Richard Abrahamian Corporate Controller Carlo Alibrandi Commercial Lending 12 | OceanFirst Financial Corp. (NASDAQ: OCFC) 2019 Annual Report Thomas Ando Commercial Lending Nina Anuario Business Development Michelle Berry Residential Lending Janet Bossi Residential Lending Edward Hlavach Internal Audit Angela Ho Chief Accounting Officer Sean Kauffman Commercial Lending Elizabeth Nugent Risk Management Rachel O’Keefe Trust & Asset Management Steven Pellegrinelli Commercial Lending E. Scott Keller Secondary Market & Construction Lending Jeana Piscatelli Treasury Management Murtuza Bhinderwala Application & Information Services Robert Kilgour Application & Information Services Michele Powelczyk Commercial Credit Administration Michael Boyd Risk Management Shannan Boyd Loan Operations Michael Coleman Commercial Lending Stephen Conti Retail Banking Sharon Danielson Retail Customer Service Samuel Davis Commercial Credit Administration Craig DeGenova Commerical Lending Michael DellaBarca Commerical Credit Administration John Finley Commercial Lending Bradley Fouss Commercial Lending Edward Geletka Business Development James Kruzinski Commercial Lending Joseph LaDuca Business Planning & Analysis Patricia Laird Strategic Integrations Cara Larned Marketing Robert Laskowski Treasurer Raymond Leahy Commercial Lending Stacy Mattia Commercial Lending Nancy Mazza Retail Product Sales Rebecca Rothstein Digital Banking Brian Schaeffer Chief Information Security Officer Paul Seidenwar Commercial Lending Alicia Smith Retail Banking AnnMarie Sorena Commercial Lending Kellie Spawton Security Noel Spear Real Estate Operations Melissa Sterling Treasury Management Scott McLaughlin Commercial Credit Administration Frank Sutton Commercial Lending Michael Messina Commercial Lending Neena Miller Chief Credit Officer Mary Ellen Georgas-Tellefsen Digital Strategy & Innovation Timothy Moffett Commercial Credit Administration Mark Harhigh Commercial Credit Administration Michael Moorhead Commercial Credit Administration Michele Hart Associate General Counsel Jill Apito Hewitt Investor Relations & Corporate Communications Edward Moran Commercial Lending Veronica Morey Retail Banking Patricia Nelson Human Resources Mark Tasy Retail Banking William Toner Chief Technology Officer Alan Turner Commercial Lending James Waldron Commercial Lending Suzanne Wegryn Commercial Credit Administration William Winans Commercial Lending Wendy Wright Commercial Credit Administration www.oceanfirst.com NASDAQ: OCFC 888.623.2633 HEADQUARTERS (HQ2) ADMINISTRATIVE OFFICES 110 West Front Street Red Bank, NJ 07701 HEADQUARTERS (HQ1) OPERATIONS CENTER 975 Hooper Avenue Toms River, NJ 08754-2009 ANNUAL MEETING OF SHAREHOLDERS The Annual Meeting of Stockholders will be held on May 20, 2020 at 9:00 a.m. Stockholders may participate in a virtual meeting or if the meeting can be held INVESTOR RELATIONS Copies of the Company’s earnings releases and financial publications, including the annual report on Form 10-K (without exhibits) filed with the Securities and Exchange Commission are available without charge by contacting: Jill Apito Hewitt, Senior Vice President, Extension 7516 or investorrelations@oceanfirst.com INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP 51 John F. Kennedy Parkway in-person it will be at the OceanFirst Short Hills, NJ 07078 STOCK TRANSFER AND REGISTRAR Shareholders wishing to change the name, address or ownership of stock, to report lost certificates or to consolidate accounts are asked to contact the Company’s stock registrar and transfer agent directly: Broadridge Corporate Issuer Solutions P.O. Box 1342, Brentwood, NY 11717 (877) 724-6454 Bank Administrative Offices at 110 West Front Street, Red Bank, New Jersey 07701. Please visit oceanfirst.com or contact Investor Relations prior to making arrangements to attend the meeting in-person to determine if plans have been changed. 

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