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OceanFirst Financial Corp. Announces Stronger Quarterly Earnings and Loan Growth

TOMS RIVER, N.J., July 24, 2014 (GLOBE NEWSWIRE) -- OceanFirst Financial Corp. (Nasdaq:OCFC), (the "Company"), the holding company for OceanFirst Bank (the "Bank"), today announced that diluted earnings per share increased to $0.30 for the quarter ended June 30, 2014, as compared to $0.29 for the corresponding prior year quarter. For the six months ended June 30, 2014, diluted earnings per share increased to $0.58, as compared to $0.55 for the corresponding prior year period.

Highlights for the quarter included:

  • Higher earnings were driven by loan portfolio growth of $60.9 million.
  • Commercial loans outstanding increased $35.3 million, the fourth consecutive quarter of double digit growth.
  • Non-performing loans decreased $4.6 million and net charge-offs fell by $253,000, 48% from the linked quarter.

The Company also announced completion of its 2012 share repurchase program and the authorization of the Board to repurchase 5% of the Company's outstanding common stock, up to an additional 867,923 shares (the "Repurchase Program").

Chairman and Chief Executive Officer, John R. Garbarino stated, "The fourth consecutive quarter of double digit commercial loan growth has reaffirmed our strategic decision to add resources in this area, and with the robust loan pipeline we anticipate continued strong loan growth. Additionally, the renewal of our common stock Repurchase Program underscores our commitment to efficiently manage capital for our shareholders in the near term, as our plans for longer term growth continue to develop."

The Board of Directors also declared the Company's seventieth consecutive quarterly cash dividend on common stock. The dividend for the quarter ended June 30, 2014 of $0.12 per share will be paid on August 15, 2014 to shareholders of record on August 4, 2014.

Results of Operations

Net income for the three months ended June 30, 2014 increased to $5.1 million, or $0.30 per diluted share, as compared to net income of $5.0 million, or $0.29 per diluted share for the corresponding prior year period. Net income for the six months ended June 30, 2014 increased to $9.8 million, or $0.58 per diluted share, as compared to net income of $9.4 million, or $0.55 per diluted share for the corresponding prior year period. The increases were primarily due to higher net interest income and a reduction in the provision for loan losses, partly offset by higher operating expenses. Additionally, earnings per share benefited from the reduction in average shares outstanding.

Net interest income for the three and six months ended June 30, 2014 increased to $18.2 million and $36.2 million, respectively, as compared to $17.5 million and $34.7 million, respectively, for the same prior year periods, reflecting an increase in the net interest margin partly offset by lower interest-earning assets. The net interest margin increased to 3.35% and 3.36%, respectively, for the three and six months ended June 30, 2014 from 3.21% and 3.19% for the same prior year periods. The yield on average interest-earning assets decreased to 3.67% for both the three and six months ended June 30, 2014, as compared to 3.69% for both prior year periods. Despite the two basis point decline, the asset yield benefited from a shift in the mix of interest-earning assets as average loans receivable, net increased $87.8 million and $60.6 million, respectively, for the three and six months ended June 30, 2014, while average interest-earning securities decreased $96.4 million and $49.6 million, respectively, as compared to the same prior year periods. The cost of average interest-bearing liabilities decreased to 0.39% and 0.38%, respectively, for the three and six months ended June 30, 2014, as compared to0.56% and 0.59%, respectively, for the same prior year periods. The decrease was partly due to the prepayment of $159.0 million of Federal Home Loan Bank ("FHLB") advances with a weighted average cost of 2.31% in the fourth quarter of 2013. Average interest-earning assets decreased $18.0 million and $22.2 million, respectively, for the three and six months ended June 30, 2014, as compared to the same prior year periods, as excess liquidity was allowed to run-off.

For the three and six months ended June 30, 2014, the provision for loan losses was $275,000 and $805,000, respectively, as compared to $800,000 and $1.9 million, respectively, for the corresponding prior year periods. The decreases for the three and six months ended June 30, 2014 were primarily due to reductions in net charge-offs of $201,000 and $791,000, respectively, as compared to the same prior year periods. Non-performing loans decreased $4.7 million at June 30, 2014, as compared to December 31, 2013, and by $5.2 million, as compared to June 30, 2013.

For the three and six months ended June 30, 2014, other income increased to $4.8 million and $8.7 million, respectively, as compared to $4.6 million and $7.9 million, respectively, in the same prior year periods. For the three and six months ended June 30, 2014, wealth management revenue increased $80,000 and $193,000, respectively, as compared to the same prior year periods, partly due to an increase in assets under administration to $229.3 million at June 30, 2014 from $175.8 million at June 30, 2013. For the three and six months ended June 30, 2014, fees and service charges increased $467,000 and $578,000, respectively, as compared to the same prior year periods primarily due to higher deposit fees from a revised fee and product structure. For the three and six months ended June 30, 2014, the net gain on the sale of loans amounted to $219,000 and $351,000, respectively, as compared to $735,000 and $561,000, respectively, in the same prior year periods. The gain on the sale of loans for the six months ended June 30, 2013 was adversely impacted by a provision of $975,000 added to the reserve for repurchased loans and loss sharing obligations, as compared to no provision in the current period. The prior year provision was related to loans sold to the Federal Home Loan Bank as part of its Mortgage Partnership Finance program. Compared to prior periods, the gain on sale of loans was adversely impacted by decreases in the gain-on-sale margin and reductions in loans sold to $10.9 million and $21.2 million, respectively, for the three and six months ended June 30, 2014, as compared to $32.3 million and $69.1 million, respectively, for the corresponding prior year periods, as increasing longer-term interest rates reduced one-to-four family loan refinance activity. For both the three and six months ended June 30, 2014, the Company recognized a gain of $348,000 on the sale of equity securities, as compared to a gain of $42,000 in the corresponding prior year periods.

Operating expenses amounted to $14.8 million and $29.0 million, respectively, for the three and six months ended June 30, 2014, as compared to $13.6 million and $26.2 million, respectively, in the same prior year periods. Compensation and employee benefits expense increased $1.1 million and $2.2 million, respectively, for the three and six months ended June 30, 2014, as compared to the same prior year periods, primarily due to personnel additions in revenue producing areas. Additionally, compensation and employee benefits expense for the three and six months ended June 30, 2014 includes $196,000 in non-recurring severance related expenses due to the Company's strategic decision to improve efficiency in the residential mortgage loan area. The related personnel reduction is expected to lower compensation and benefits expense by $650,000 annually. Marketing expenses increased $163,000 and $445,000, respectively, as compared to the same prior year periods, primarily due to a promotional campaign to attract retail checking accounts and incent bankcard usage. The promotion resulted in the acquisition of approximately 1,400 new checking relationships for the year-to-date. These increases were partly offset by reductions in professional fees of $180,000 and $416,000, respectively, for the three and six months ended June 30, 2014, as compared to the corresponding prior year periods.

The provision for income taxes was $2.8 million and $5.3 million, respectively, for the three and six months ended June 30, 2014, as compared to $2.8 million and $5.2 million, respectively, for the same prior year periods. The effective tax rate was 35.1% and 35.2%, respectively, for the three and six months ended June 30, 2014, as compared to 35.7% and 35.4%, respectively, in the same prior year periods.

Financial Condition

Total assets increased by $79.4 million to $2,329.1 million at June 30, 2014, from $2,249.7 million at December 31, 2013. Loans receivable, net, increased by $90.4 million, to $1,631.8 million at June 30, 2014 from $1,541.5 million at December 31, 2013, primarily due to growth in commercial loans of $62.8 million and in residential construction loans, net of loans in process, which increased $11.6 million. Additionally, on June 30, 2014 the Company purchased a pool of performing, locally originated, one-to-four family, non-conforming mortgage loans for $20.6 million.

Deposits decreased by $41.3 million, to $1,705.5 million at June 30, 2014, from $1,746.8 million at December 31, 2013, despite strong growth in retail and business checking accounts. All of the decrease was related to a reduction in government deposits. Non-interest-bearing deposit accounts increased $63.6 million during the first half of 2014 due to a revised fee and product structure. To fund loan growth, FHLB advances increased $130.0 million, to $305.0 million at June 30, 2014, from $175.0 million at December 31, 2013. Stockholders' equity increased to $215.8 million at June 30, 2014, as compared to $214.4 million at December 31, 2013. Net income for the period was partly offset by the repurchase of 301,766 shares of common stock for $5.0 million (average cost per share of $16.64) and the cash dividend on common stock. At June 30, 2014, there were no shares available for repurchase under the stock repurchase program adopted in the fourth quarter of 2012, although 867,923 shares are available for repurchase under the Repurchase Program announced today. Tangible stockholders' equity per common share was $12.59 at June 30, 2014, as compared to $12.33 at December 31, 2013.

Asset Quality

The Company's non-performing loans totaled $40.7 million at June 30, 2014, a $4.7 million decrease from December 31, 2013. Net loan charge-offs decreased to $799,000 for the six months ended June 30, 2014, as compared to $1.6 million for the corresponding prior year period.

Conference Call

As previously announced, the Company will host an earnings conference call on Friday, July 25, 2014 at 11:00 a.m. Eastern time. The direct dial number for the call is (888) 338-7143. For those unable to participate in the conference call, a replay will be available. To access the replay, dial (877) 344-7529, Replay Conference Number 10048830 from one hour after the end of the call until October 31, 2014. The conference call, as well as the replay, are also available (listen-only) by internet webcast at www.oceanfirst.com in the Investor Relations section.

OceanFirst Financial Corp.'s subsidiary, OceanFirst Bank, founded in 1902, is a federally-chartered savings bank with $2.3 billion in assets and twenty-three branches located in Ocean, Monmouth and Middlesex Counties, New Jersey. The Bank is the largest and oldest community-based financial institution headquartered in Ocean County, New Jersey.

OceanFirst Financial Corp.'s press releases are available by visiting us at www.oceanfirst.com.

Forward-Looking Statements

In addition to historical information, this news release 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 forward-looking statements are generally identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project," "will," "should," "may," "view," "opportunity," "potential," or similar expressions or expressions of confidence. The Company's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to: changes in interest rates, general economic conditions, levels of unemployment in the Bank's lending area, real estate market values in the Bank's lending area, future natural disasters and increases to flood insurance premiums, the level of prepayments on loans and mortgage-backed securities, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System, the quality or composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company's market area and accounting principles and guidelines. These risks and uncertainties are further discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

OceanFirst Financial Corp.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands, except per share amounts)
June 30, March 31, December 31,
2014 2014 2013
ASSETS (unaudited) (unaudited)
Cash and due from banks $ 43,817 $ 36,746 $ 33,958
Securities available-for-sale, at estimated fair value 32,303 39,261 43,836
Securities held-to-maturity, net (estimated fair value of $485,124 at June 30, 2014, $498,383 at March 31, 2014, and $495,082 at December 31, 2013, respectively) 478,389 496,111 495,599
Federal Home Loan Bank of New York stock, at cost 20,246 17,011 14,518
Loans receivable, net 1,631,819 1,570,969 1,541,460
Mortgage loans held for sale 1,295 1,153 785
Interest and dividends receivable 5,317 5,361 5,380
Other real estate owned 4,968 4,457 4,345
Premises and equipment, net 24,430 23,963 23,684
Servicing asset 3,772 3,965 4,178
Bank Owned Life Insurance 55,286 54,909 54,571
Deferred tax asset 15,417 15,191 15,239
Other assets 12,082 12,614 12,158
Total assets $2,329,141 $2,281,711 $2,249,711
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $1,705,510 $1,720,131 $1,746,763
Securities sold under agreements to repurchase with retail customers 62,341 66,226 68,304
Federal Home Loan Bank advances 305,000 232,300 175,000
Other borrowings 27,500 27,500 27,500
Due to brokers 1,522
Advances by borrowers for taxes and insurance 6,896 6,892 6,471
Other liabilities 6,053 10,950 11,323
Total liabilities 2,113,300 2,065,521 2,035,361
Stockholders' equity:
Preferred stock, $.01 par value, $1,000 liquidation preference, 5,000,000 shares authorized, no shares issued
Common stock, $.01 par value, 55,000,000 shares authorized, 33,566,772 shares issued and 17,144,693, 17,358,459 and 17,387,049 shares outstanding at
June 30, 2014, March 31, 2014 and December 31, 2013, respectively

336
336 336
Additional paid-in capital 264,592 264,289 263,319
Retained earnings 211,819 208,732 206,201
Accumulated other comprehensive loss (6,902) (6,575) (6,619)
Less: Unallocated common stock held by Employee Stock Ownership Plan (3,458) (3,544) (3,616)
Treasury stock, 16,422,079, 16,208,313 and 16,179,723 shares at June 30, 2014, March 31, 2014 and December 31, 2013, respectively (250,546) (247,048) (245,271)
Common stock acquired by Deferred Compensation Plan (315) (324) (665)
Deferred Compensation Plan Liability 315 324 665
Total stockholders' equity 215,841 216,190 214,350
Total liabilities and stockholders' equity $2,329,141 $2,281,711 $2,249,711
OceanFirst Financial Corp.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
For the Three Months Ended, For the Six Months Ended,
June 30, March 31, June 30, June 30, June 30,
2014 2014 2013 2014 2013
(unaudited) (unaudited)
Interest income:
Loans $17,530 $17,246 $17,428 $34,776 $35,091
Mortgage-backed securities 1,731 1,763 2,026 3,494 3,675
Investment securities and other 637 736 707 1,373 1,447
Total interest income 19,898 19,745 20,161 39,643 40,213
Interest expense:
Deposits 986 1,096 1,175 2,082 2,501
Borrowed funds 753 584 1,442 1,337 2,979
Total interest expense 1,739 1,680 2,617 3,419 5,480

Net interest income

18,159

18,065

17,544

36,224

34,733
Provision for loan losses 275 530 800 805 1,900
Net interest income after provision for loan losses 17,884 17,535 16,744 35,419 32,833
Other income:
Bankcard services revenue 897 791 921 1,689 1,731
Wealth management revenue 608 540 528 1,148 955
Fees and service charges 2,278 1,857 1,811 4,134 3,556
Loan servicing income 226 228 172 454 328
Net gain on sales of loans available for sale 219 132 735 351 561
Net gain on sales of investment securities available for sale 348 42 348 42
Net (loss) gain from other real estate operations (107) (32) 74 (139) 77
Income from Bank Owned Life Insurance 377 338 332 715 647
Other 1 1 2 2 18
Total other income 4,847 3,855 4,617 8,702 7,915
Operating expenses:
Compensation and employee benefits 8,131 7,685 7,039 15,816 13,617
Occupancy 1,364 1,464 1,376 2,828 2,739
Equipment 768 756 690 1,524 1,328
Marketing 610 532 447 1,142 697
Federal deposit insurance 538 546 536 1,083 1,060
Data processing 987 1,070 962 2,057 1,935
Check card processing 494 446 423 940 834
Professional fees 523 375 703 898 1,314
Other operating expense 1,432 1,246 1,424 2,679 2,630
Total operating expenses 14,847 14,120 13,600 28,967 26,154
Income before provision for income taxes 7,884 7,270 7,761 15,154 14,594
Provision for income taxes 2,767 2,563 2,774 5,330 5,170
Net income $ 5,117 $ 4,707 $ 4,987 $ 9,824 $ 9,424
Basic earnings per share $ 0.31 $ 0.28 $ 0.29 $ 0.58 $ 0.55
Diluted earnings per share $ 0.30 $ 0.28 $ 0.29 $ 0.58 $ 0.55
Average basic shares outstanding 16,740 16,884 17,105 16,812 17,194
Average diluted shares outstanding 16,822 17,050 17,144 16,946 17,233
OceanFirst Financial Corp.
SELECTED CONSOLIDATED FINANCIAL DATA
(in thousands, except per share amounts)
At June 30, At March 31, At December 31,
2014 2014 2013
STOCKHOLDERS' EQUITY
Stockholders' equity to total assets 9.27% 9.47% 9.53%
Common shares outstanding (in thousands) 17,145 17,358 17,387
Stockholders' equity per common share $12.59 $12.45 $12.33
Tangible stockholders' equity per common share 12.59 12.45 12.33
ASSET QUALITY
Non-performing loans:
Real estate – one-to-four family $25,313 $27,486 $28,213
Commercial real estate 12,094 13,675 12,304
Consumer 3,128 3,731 4,328
Commercial and industrial 164 429 515
Total non-performing loans 40,699 45,321 45,360
Other real estate owned 4,968 4,457 4,345
Total non-performing assets $45,667 $49,778 $49,705
Delinquent loans 30 to 89 days $ 8,923 $ 9,137 $ 9,147
Troubled debt restructurings:
Non-performing (included in total non-performing loans above) $ 7,047 $10,217 $ 9,663
Performing 23,000 21,435 21,456
Total troubled debt restructurings $30,047 $31,652 $31,119
Allowance for loan losses $20,936 $20,934 $20,930
Allowance for loan losses as a percent of total loans receivable 1.26% 1.31% 1.33%
Allowance for loan losses as a percent of total non-performing loans 51.44 46.19 46.14
Non-performing loans as a percent of total loans receivable 2.44 2.83 2.88
Non-performing assets as a percent of total assets 1.96 2.18 2.21
WEALTH MANAGEMENT
Assets under administration $229,289 $216,508 $216,144
For the Three Months Ended, For the Six Months Ended,
June 30, March 31, June 30, June 30, June 30,
2014 2014 2013 2014 2013
PERFORMANCE RATIOS (ANNUALIZED)
Return on average assets 0.90% 0.83% 0.87% 0.86% 0.82%
Return on average stockholders' equity 9.45 8.72 9.06 9.09 8.56
Interest rate spread 3.28 3.31 3.13 3.29 3.10
Interest rate margin 3.35 3.36 3.21 3.36 3.19
Operating expenses to average assets 2.60 2.49 2.36 2.55 2.27
Efficiency ratio 64.54 64.42 61.37 64.48 61.33
OceanFirst Financial Corp.
SELECTED LOAN AND DEPOSIT DATA
(in thousands)
LOANS RECEIVABLE
June 30, 2014 March 31, 2014 December 31, 2013
Real estate:
One-to-four family $766,761 $748,647 $751,370
Commercial real estate, multi-family and land 577,061 550,808 528,945
Residential construction 46,092 37,852 30,821
Consumer 201,839 199,926 200,683
Commercial and industrial 75,215 66,196 60,545
Total loans 1,666,968 1,603,429 1,572,364
Loans in process (16,374) (13,991) (12,715)
Deferred origination costs, net 3,456 3,618 3,526
Allowance for loan losses (20,936) (20,934) (20,930)
Total loans, net 1,633,114 1,572,122 1,542,245
Less: mortgage loans held for sale 1,295 1,153 785
Loans receivable, net $1,631,819 $1,570,969 $1,541,460
Mortgage loans serviced for others $786,095 $794,530 $806,810
Loan pipeline: Average Yield
Commercial 4.26% $69,535 46,813 $58,992
Construction/permanent 3.91% 6,369 9,753 9,955
One-to-four family 4.27% 19,792 19,729 18,827
Consumer 4.39% 5,045 7,118 5,496
$100,741 $83,413 $93,270
For the Three Months Ended, For the Six Months Ended,
June 30, 2014 March 31, 2014 June 30, 2013 June 30, 2014 June 30, 2013
Loan originations:
Commercial $46,909 $52,482 $29,256 $99,391 $47,694
Construction/permanent 13,163 10,416 5,609 23,579 9,199
One-to-four family 32,252 27,738 58,442 59,990 112,127
Consumer 15,893 13,379 15,582 29,272 26,712
Total $108,217 $104,015 $108,889 $212,232 $195,732
Loans sold $10,936 $10,270 $32,343 $21,206 $69,134
Net charge-offs 273 526 474 799 1,590
DEPOSITS
June 30, 2014 March 31, 2014 December 31, 2013
Type of Account
Non-interest-bearing $271,208 $218,124 $207,608
Interest-bearing checking 817,085 865,023 913,753
Money market deposit 107,365 123,701 116,947
Savings 295,133 297,739 290,512
Time deposits 214,719 215,544 217,943
$1,705,510 $1,720,131 $1,746,763
OceanFirst Financial Corp.
ANALYSIS OF NET INTEREST INCOME
FOR THE THREE MONTHS ENDED,
JUNE 30, 2014 MARCH 31, 2014 JUNE 30, 2013

AVERAGE
BALANCE


INTEREST
AVERAGE
YIELD/
COST

AVERAGE
BALANCE


INTEREST
AVERAGE
YIELD/
COST

AVERAGE
BALANCE


INTEREST
AVERAGE
YIELD/
COST
(dollars in thousands)
Assets
Interest-earning assets:
Interest-earning deposits and short-term investments $ 26,563 $ 4 0.06% $ 29,332 $ 6 0.08% $ 36,601 $ 19 0.21%
Securities (1) and FHLB stock 552,851 2,364 1.71 562,350 2,493 1.77 648,697 2,714 1.67
Loans receivable, net (2) 1,588,815 17,530 4.41 1,557,281 17,246 4.43 1,500,980 17,428 4.64
Total interest-earning assets 2,168,229 19,898 3.67 2,148,963 19,745 3.68 2,186,278 20,161 3.69
Non-interest-earning assets 118,551 115,855 119,416
Total assets $2,286,780 $2,264,818 $2,305,694
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
Transaction deposits $1,257,291 247 0.08 $1,322,358 363 0.11 $1,318,230 438 0.13
Time deposits 215,148 739 1.37 215,710 733 1.36 215,917 737 1.37
Total 1,472,439 986 0.27 1,538,068 1,096 0.29 1,534,147 1,175 0.31
Borrowed funds 330,933 753 0.91 283,256 584 0.82 326,720 1,442 1.77
Total interest-bearing liabilities 1,803,372 1,739 0.39 1,821,324 1,680 0.37 1,860,867 2,617 0.56
Non-interest-bearing deposits 252,395 210,867 208,915
Non-interest-bearing liabilities 14,530 16,690 15,719
Total liabilities 2,070,297 2,048,881 2,085,501
Stockholders' equity 216,483 215,937 220,193
Total liabilities and stockholders' equity $2,286,780 $2,264,818 $2,305,694
Net interest income $18,159 $18,065 $17,544
Net interest rate spread (3) 3.28% 3.31% 3.13%
Net interest margin (4) 3.35% 3.36% 3.21%
FOR THE SIX MONTHS ENDED,
JUNE 30, 2014 JUNE 30, 2013
AVERAGE BALANCE INTEREST AVERAGE YIELD/COST AVERAGE BALANCE INTEREST AVERAGE YIELD/COST
(dollars in thousands)
Assets
Interest-earning assets:
Interest-earning deposits and short-term investments $ 27,940 $ 10 0.07% $ 61,140 $ 45 0.15%
Securities (1) and FHLB stock 557,573 4,857 1.74 607,178 5,077 1.67
Loans receivable, net (2) 1,573,135 34,776 4.42 1,512,501 35,091 4.64
Total interest-earning assets 2,158,648 39,643 3.67 2,180,819 40,213 3.69
Non-interest-earning assets 117,212 118,786
Total assets $2,275,860 $2,299,605
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
Transaction deposits $1,289,760 610 0.09 $1,324,466 1,003 0.15
Time deposits 215,427 1,472 1.37 218,544 1,498 1.37
Total 1,505,187 2,082 0.28 1,543,010 2,501 0.32
Borrowed funds 307,227 1,337 0.87 323,202 2,979 1.84
Total interest-bearing liabilities 1,812,414 3,419 0.38 1,866,212 5,480 0.59
Non-interest-bearing deposits 231,631 196,990
Non-interest-bearing liabilities 15,604 16,279
Total liabilities 2,059,649 2,079,481
Stockholders' equity 216,211 220,124
Total liabilities and stockholders' equity $2,275,860 $2,299,605
Net interest income $36,224 $34,733
Net interest rate spread (3) 3.29% 3.10%
Net interest margin (4) 3.36% 3.19%
(1) Amounts are recorded at average amortized cost.
(2) Amount is net of deferred loan fees, undisbursed loan funds, discounts and premiums and estimated loss allowances and includes loans held for sale and non-performing loans.
(3) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average interest-earning assets.

CONTACT: Michael J. Fitzpatrick Chief Financial Officer OceanFirst Financial Corp. Tel: (732) 240-4500, ext. 7506 Fax: (732) 349-5070 Email: Mfitzpatrick@oceanfirst.comSource:OceanFirst Financial Corp.