RED BANK, N.J., July 18, 2024 (GLOBE NEWSWIRE) -- OceanFirst Financial Corp. (NASDAQ:OCFC) (the "Company"), the holding company for OceanFirst Bank N.A. (the "Bank"), announced net income available to common stockholders of $23.4 million, or $0.40 per diluted share, for the three months ended June 30, 2024, a decrease from $26.8 million, or $0.45 per diluted share, for the corresponding prior year period, and $27.7 million, or $0.47 per diluted share, for the prior linked quarter. For the six months ended June 30, 2024, the Company reported net income available to common stockholders of $51.0 million, or $0.87 per diluted share, a decrease from $53.7 million, or $0.91 per diluted share, for the corresponding prior year period. Selected performance metrics are as follows (refer to "Selected Quarterly Financial Data" for additional information):   For the Three Months Ended,   For the Six Months Ended, Performance Ratios (Annualized): June 30,   March 31,   June 30,   June 30,   June 30, 2024   2024   2023   2024   2023 Return on average assets 0.70 %   0.82 %   0.80 %   0.76 %   0.81 % Return on average stockholders' equity 5.61     6.65     6.61     6.13     6.69   Return on average tangible stockholders' equity (a) 8.10     9.61     9.70     8.86     9.84   Return on average tangible common equity (a) 8.51     10.09     10.21     9.30     10.37   Efficiency ratio 62.86     59.56     62.28     61.17     61.53   Net interest margin 2.71     2.81     3.02     2.76     3.17   (a) Return on average tangible stockholders' equity and return on average tangible common equity ("ROTCE") are non-GAAP ("generally accepted accounting principles") financial measures and exclude the impact of intangible assets and goodwill from both assets and stockholders' equity. ROTCE also excludes preferred stock from stockholders' equity. Refer to "Explanation of Non-GAAP Financial Measures," "Selected Quarterly Financial Data" and "Non-GAAP Reconciliation" tables for additional information regarding non-GAAP financial measures. Core earnings1 for the three and six months ended June 30, 2024 were $22.7 million and $48.3 million, respectively, or $0.39 and $0.83 per diluted share, a decrease from $27.2 million and $59.9 million, or $0.46 and $1.01 per diluted share, for the corresponding prior year periods, and a decrease from $25.6 million, or $0.44 per diluted share, for the prior linked quarter. Core earnings PTPP1 for the three and six months ended June 30, 2024 was $32.7 million and $68.9 million, respectively, or $0.56 and $1.18 per diluted share, as compared to $37.6 million and $83.7 million, or $0.64 and $1.42 per diluted share, for the corresponding prior year periods, and $36.2 million, or $0.62 per diluted share, for the prior linked quarter. Selected performance metrics are as follows:   For the Three Months Ended,   For the Six Months Ended,   June 30,   March 31,   June 30,   June 30,   June 30, Core Ratios1 (Annualized):   2024       2024       2023       2024       2023   Return on average assets   0.68 %     0.76 %     0.81 %     0.72 %     0.90 % Return on average tangible stockholders' equity   7.86       8.91       9.84       8.38       10.98   Return on average tangible common equity   8.26       9.36       10.36       8.81       11.56   Efficiency ratio   63.47       61.05       61.94       62.24       59.13   Core diluted earnings per share $ 0.39     $ 0.44     $ 0.46     $ 0.83     $ 1.01   Core PTPP diluted earnings per share   0.56       0.62       0.64       1.18       1.42                                           Key developments for the recent quarter are described below: Asset Quality: Asset quality metrics remain strong as criticized and classified assets, non-performing loans, and loans 30 to 89 days past due as a percentage of total loans receivable were 1.42%, 0.33%, and 0.10%, respectively. These metrics continue to reflect strong credit performance and remain low compared to pre-pandemic levels. Capital Accretion: Common equity tier 1 capital ratio2, book value and tangible book value per share were 11.2%, $28.67 and $18.93, respectively, and increased approximately 20 basis points, $0.35 and $0.30 from the prior linked quarter.3 Share repurchases: The Company repurchased 338,087 shares totaling $5.0 million. The Company has 1,638,524 shares available for repurchase under the authorized repurchase program. Chairman and Chief Executive Officer, Christopher D. Maher, commented on the Company's results, "Our current quarter results reflected prudent balance sheet management and expense discipline. As rates are elevated and the yield curve remains inverted, net interest margin compressed during the quarter, but the pace of margin compression is slowing. Additionally, our credit quality continues to remain robust, we grew capital, and continued share repurchases during the quarter." Mr. Maher added, "The Company is well positioned to bolster shareholder value through growth in the second half of the year." The Company's Board of Directors declared its 110th consecutive quarterly cash dividend on common stock. The quarterly cash dividend on common stock of $0.20 per share will be paid on August 16, 2024 to common stockholders of record on August 5, 2024. The Company's Board of Directors also declared a quarterly cash dividend on preferred stock of $0.4375 per depositary share, representing 1/40th interest in the Series A Preferred Stock. This dividend will be paid on August 15, 2024 to preferred stockholders of record on July 31, 2024. 1 Core earnings and core earnings before income taxes and provision for credit losses ("PTPP or Pre-Tax-Pre-Provision"), and ratios derived therefrom, are non-GAAP financial measures. For the periods presented, core earnings exclude merger related expenses, net branch consolidation expense, net (gain) loss on equity investments, net loss on sale of investments, net gain on sale of trust business, Federal Deposit Insurance Corporation ("FDIC") special assessment, and the income tax effect of these items, (collectively referred to as "non-core" operations). PTPP excludes the aforementioned pre-tax "non-core" items along with income tax expense (benefit) and provision for credit losses. Refer to "Explanation of Non-GAAP Financial Measures", "Selected Quarterly Financial Data" and the "Non-GAAP Reconciliation" tables for additional information regarding non-GAAP financial measures. 2 Estimated.3 Tangible book value per common share and tangible common equity to tangible assets are non-GAAP financial measures and exclude the impact of intangible assets, goodwill, and preferred equity from both stockholders' equity and total assets. Refer to "Explanation of Non-GAAP Financial Measures" and the "Non-GAAP Reconciliation" tables for additional information regarding non-GAAP financial measures. Results of Operations The current quarter net interest income and margin were impacted by a mix-shift to and repricing of higher cost funding. Deposit betas increased modestly to 42%, from 40% in the prior linked quarter.4 Additionally, the current quarter provision for credit losses includes the impact of an additional $1.6 million charge-off on the single commercial real estate relationship that was previously moved to non-accrual and partially charged-off in 2023. The collateral related to the noted credit is currently under an agreement to sell, which is expected to occur during the third quarter. 4 Deposit beta measures the change in the interest rates paid for interest-bearing deposit accounts versus the change in the federal funds target rate. Represents the deposit beta for total deposits (interest-bearing and non-interest bearing) for the current rate cycle (since December 31, 2021). Net Interest Income and Margin Three months ended June 30, 2024 vs. June 30, 2023 Net interest income decreased to $82.3 million, from $92.1 million, primarily reflecting the net impact of the higher interest rate environment. Net interest margin decreased to 2.71%, from 3.02%, which included the impact of purchase accounting accretion and prepayment fees of 0.04% and 0.05%, respectively. Net interest margin decreased primarily due to the increase in cost of funds outpacing the increase in yield on average interest-earning assets. Average interest-earning assets decreased by $46.3 million due to balance sheet contraction while the average yield for interest-earning assets increased to 5.25%, from 4.91%. The cost of average interest-bearing liabilities increased to 3.14%, from 2.39%, primarily due to higher cost of deposits. The total cost of deposits (including non-interest bearing deposits) increased to 2.37%, from 1.52%. Average interest-bearing liabilities increased by $149.6 million, primarily due to an increase in total deposits, partly offset by a decrease in total borrowings. Six months ended June 30, 2024 vs. June 30, 2023 Net interest income decreased to $168.5 million, from $190.9 million, reflecting the net impact of the higher interest rate environment. Net interest margin decreased to 2.76%, from 3.17%, which included the impact of purchase accounting accretion and prepayment fees of 0.04% for both periods. Average interest-earning assets increased by $146.4 million, primarily driven by securities growth of $135.4 million, while the average yield increased to 5.25%, from 4.80%. The cost of average interest-bearing liabilities increased to 3.09%, from 2.08%. The total cost of deposits (including non-interest bearing deposits) increased to 2.34%, from 1.21%. Average interest-bearing liabilities increased by $392.0 million. The drivers for the three month periods, described above, were also the drivers for the six month periods. Three months ended June 30, 2024 vs. March 31, 2024 Net interest income decreased by $4.0 million, primarily due to an increase in cost of funds and lower average-interest earning assets. Net interest margin decreased to 2.71%, from 2.81%, which included the impact of purchase accounting accretion and prepayment fees of 0.04% for both periods. Average interest-earning assets decreased by $146.6 million, primarily due to a decrease in loans. The yield on average interest-earning assets decreased to 5.25%, from 5.26%. The total cost of average interest-bearing liabilities increased to 3.14%, from 3.03%, primarily due to higher cost of deposits. Total cost of deposits (including non-interest bearing deposits) increased to 2.37%, from 2.31%. Average interest-bearing liabilities decreased by $129.4 million, primarily due to decreases in brokered time deposits and high yield savings accounts, partly offset by an increase in borrowings. Provision for Credit Losses Provision for credit losses for the three and six months ended June 30, 2024 was $3.1 million and $3.7 million, respectively, as compared to $1.2 million and $4.2 million for the corresponding prior year periods, and $591,000 in the prior linked quarter. The current quarter provision was driven by the additional charge-off previously noted and changes in the external macro-economic forecasts, partly offset by lower loan balances. Net loan charge-offs were $1.5 million and $1.8 million for the three and six months ended June 30, 2024, respectively, as compared to net loan charge-offs of $123,000 and $76,000 for the three and six months ended June 30, 2023. The current quarter includes the impact of an additional $1.6 million charge-off related to a single commercial real estate relationship, as previously noted. Net loan charge-offs were $349,000 in the prior linked quarter. Refer to "Asset Quality" section for further discussion. Non-interest Income Three months ended June 30, 2024 vs. June 30, 2023 Other income increased to $11.0 million, as compared to $8.9 million. Other income was favorably impacted by non-core operations related to net gains/losses on equity investments of $887,000 for the current quarter, and adversely impacted by non-core operations of $559,000 for the prior year quarter. Excluding non-core operations, other income increased by $611,000, primarily driven by increases in the cash surrender value of bank owned life insurance of $544,000 and net gain on sale of loans of $387,000, partially offset by a decrease in fees and service charges of $587,000 on lower title activity and retail deposit fees. Six months ended June 30, 2024 vs. June 30, 2023 Other income increased to $23.3 million, as compared to $11.0 million. The current period was favorably impacted by non-core operations of $4.0 million related to net gains on equity investments and sale of a portion of the Company's trust business. The prior year was adversely impacted by non-core operations of $8.1 million, primarily related to losses on sale of investments. Excluding non-core operations, other income increased by $241,000, primarily driven by increases in the cash surrender value of bank owned life insurance of $1.1 million, which included one-time death benefits in the current period, and net gain on sale of loans of $724,000. This was partially offset by a decrease in fees and service charges of $1.3 million, which was driven by the same factors as noted above. Three months ended June 30, 2024 vs. March 31, 2024 Other income in the prior linked quarter was $12.3 million and was favorably impacted by non-core operations of $3.1 million related to net gains on equity investments and sale of a portion of the Company's trust business. Excluding non-core operations, other income increased by $897,000, primarily due to an increase in fees and service charges of $542,000, which was driven by higher title activity. Non-interest Expense Three months ended June 30, 2024 vs. June 30, 2023 Operating expenses decreased $4.3 million to $58.6 million, from $62.9 million. The primary drivers were decreases in professional fees of $2.9 million and compensation and employee benefits expenses of $1.1 million, which reflect the net realization of the Company's performance improvements initiatives and strategic investments made over the past year. Six months ended June 30, 2024 vs. June 30, 2023 Operating expenses decreased to $117.3 million, as compared to $124.2 million. Operating expenses were adversely impacted by an FDIC special assessment in the current year of $418,000, and merger related and net branch consolidation expenses of $92,000 in the prior year period. Excluding non-core operations, operating expenses decreased by $7.3 million. The primary drivers were decreases in professional fees of $5.3 million and compensation and employee benefits expenses of $2.2 million, which reflect the net realization of the Company's performance improvements initiatives and strategic investments made over the past year. Three months ended June 30, 2024 vs. March 31, 2024 Operating expenses in the prior linked quarter were $58.7 million and included non-core operations of $418,000, related to an FDIC special assessment. Excluding non-core operations, operating expenses increased by $366,000. Income Tax Expense The provision for income taxes was $7.1 million and $17.7 million for the three and six months ended June 30, 2024, respectively, as compared to $9.0 million and $17.7 million for the same prior year periods, and $10.6 million for the prior linked quarter. The effective tax rate was 22.5% and 25.0% for the three and six months ended June 30, 2024, respectively, as compared to 24.4% and 24.0% for the same prior year periods, and 27.1% for the prior linked quarter. The prior linked quarter and current year's effective tax rates were negatively impacted by 3.0% and 1.6%, respectively, due to a non-recurring write-off of a deferred tax asset of $1.2 million. Financial Condition June 30, 2024 vs. December 31, 2023 Total assets decreased by $216.5 million to $13.32 billion, from $13.54 billion, primarily due to decreases in loans and debt securities. Total loans decreased by $175.3 million to $10.02 billion, from $10.19 billion, primarily due to a decrease in the total commercial portfolio of $165.3 million driven by loan payoffs and lower loan originations. The loan pipeline increased by $76.1 million to $259.1 million from $183.0 million. Held-to-maturity debt securities decreased by $53.9 million to $1.11 billion, from $1.16 billion, primarily due to principal repayments. Debt securities available-for-sale decreased $32.4 million to $721.5 million, from $753.9 million, primarily due to principal reductions and maturities. Other assets increased by $23.3 million to $203.0 million, from $179.7 million, primarily due to an increase in the market values of derivatives associated with customer interest rate swap programs. Total liabilities decreased by $231.2 million to $11.65 billion, from $11.88 billion primarily related to lower deposits and a funding mix shift. Deposits decreased by $440.9 million to $9.99 billion, from $10.43 billion, primarily due to decreases in high-yield savings accounts of $283.1 million and interest bearing deposits of $243.9 million. Time deposits decreased to $2.37 billion, from $2.45 billion, representing 23.7% and 23.4% of total deposits, respectively, which was primarily related to planned runoff of brokered time deposits which decreased by $229.9 million, offset by increases in retail time deposits of $161.7 million. The loan-to-deposit ratio was 100.3%, as compared to 97.7%. Federal Home Loan Bank ("FHLB") advances decreased by $59.3 million to $789.3 million, from $848.6 million due to a mix shift in funding sources to other borrowings, which increased by $228.0 million to $424.5 million, from $196.5 million, as a result of lower cost funding availability. Other liabilities increased by $31.4 million to $332.1 million, from $300.7 million, primarily due to an increase in the market values of derivatives associated with customer interest rate swaps and related collateral received from counterparties. Capital levels remain strong and in excess of "well-capitalized" regulatory levels at June 30, 2024, including the Company's estimated common equity tier one capital ratio which increased to 11.2%, up approximately 35 basis points from December 31, 2023. Total stockholders' equity increased to $1.68 billion, as compared to $1.66 billion, primarily reflecting net income, partially offset by capital returns comprising of share repurchases and dividends. For the six months ended June 30, 2024, the Company repurchased 1,295,914 shares totaling $20.1 million representing a weighted average cost of $15.35. The Company had 1,638,524 shares available for repurchase under the authorized repurchase program. Additionally, accumulated other comprehensive loss decreased by $3.7 million primarily due to increases in fair market value of available-for-sale debt securities, net of tax. The Company actively monitors its goodwill as the challenging economic environment persists and continues to pressure the Company's stock price and industry valuations. The Company customarily performs its annual goodwill impairment assessment during the third quarter. The Company's tangible common equity3 increased by $11.6 million to $1.11 billion. The Company's stockholders' equity to assets ratio was 12.59% at June 30, 2024, and tangible common equity to tangible assets ratio increased by 26 basis points during the quarter to 8.64%, primarily due to the drivers described above. Book value per common share increased to $28.67, as compared to $27.96. Tangible book value per common share3 increased to $18.93, as compared to $18.35. Asset Quality June 30, 2024 vs. December 31, 2023 Overall asset quality metrics remained stable. The Company's non-performing loans increased to $33.4 million from $29.5 million and represented 0.33% and 0.29% of total loans, respectively. The allowance for loan credit losses as a percentage of total non-performing loans was 205.97%, as compared to 227.21%. The level of 30 to 89 days delinquent loans decreased to $9.7 million, from $19.2 million. Criticized and classified assets decreased to $142.6 million, from $146.9 million. The Company's allowance for loan credit losses was 0.69% of total loans, as compared to 0.66%. Refer to` "Provision for Credit Losses" section for further discussion. The Company's asset quality, excluding purchased with credit deterioration ("PCD") loans, was as follows. Non-performing loans increased to $30.6 million, from $26.4 million. The allowance for loan credit losses as a percentage of total non-performing loans was 225.10%, as compared to 254.64%. The level of 30 to 89 days delinquent loans, excluding non-performing loans, decreased to $8.5 million, from $17.7 million. The allowance for loan credit losses plus the unamortized credit and PCD marks amounted to $75.0 million, or 0.75% of total loans, as compared to $74.7 million, or 0.73% of total loans. Explanation of Non-GAAP Financial Measures Reported amounts are presented in accordance with GAAP. The Company's management believes that the supplemental non-GAAP information, which consists of reported net income excluding non-core operations and in some instances excluding income taxes and provision for credit losses, and reporting equity and asset amounts excluding intangible assets, goodwill or preferred stock, all of which can vary from period to period, provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company's financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures, which may be presented by other companies. Refer to the Non-GAAP Reconciliation table at the end of this document for details on the earnings impact of these items. Conference Call As previously announced, the Company will host an earnings conference call on Friday, July 19, 2024 at 11:00 a.m. Eastern Time. The direct dial number for the call is (833) 470-1428, using the access code 619002. For those unable to participate in the conference call, a replay will be available. To access the replay, dial (866) 813-9403, access code 217614, from one hour after the end of the call until August 16, 2024. 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 N.A., founded in 1902, is a $13.3 billion regional bank providing financial services throughout New Jersey and in the major metropolitan areas between Massachusetts and Virginia. OceanFirst Bank delivers commercial and residential financing, treasury management, trust and asset management, and deposit services and is one of the largest and oldest community-based financial institutions headquartered in New Jersey. To learn more about OceanFirst, go to 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 Litigation 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, inflation, general economic conditions, potential recessionary conditions, levels of unemployment in the Company's lending area, real estate market values in the Company's lending area, potential goodwill impairment, natural disasters, potential increases to flood insurance premiums, the current or anticipated impact of military conflict, terrorism or other geopolitical events, 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, the availability of low-cost funding, changes in liquidity, including the size and composition of the Company's deposit portfolio, and the percentage of uninsured deposits in the portfolio, changes in capital management and balance sheet strategies and the ability to successfully implement such strategies, competition, demand for financial services in the Company's market area, changes in consumer spending, borrowing and saving habits, changes in accounting principles, a failure in or breach of the Company's operational or security systems or infrastructure, including cyberattacks, the failure to maintain current technologies, failure to retain or attract employees, the effect of the Company's rating under the Community Reinvestment Act, the impact of pandemics on our operations and financial results and those of our customers and the Bank's ability to successfully integrate acquired operations. These risks and uncertainties are further discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, under Item 1A - Risk Factors and elsewhere, and subsequent securities filings 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)                       June 30,   March 31,   December 31,   June 30,     2024   2024   2023   2023     (Unaudited)   (Unaudited)       (Unaudited) Assets                 Cash and due from banks   $ 181,198   $ 130,422   $ 153,718   $ 457,747 Debt securities available-for-sale, at estimated fair value     721,484     744,944     753,892     452,016 Debt securities held-to-maturity, net of allowance for securities credit losses of $958 at June 30, 2024, $1,058 at March 31, 2024, $1,133 at December 31, 2023 and $964 at June 30, 2023 (estimated fair value of $1,003,850 at June 30, 2024, $1,029,965 at March 31, 2024, $1,068,438 at December 31, 2023 and $1,109,756 at June 30, 2023)     1,105,843     1,128,666     1,159,735     1,222,507 Equity investments     104,132     103,201     100,163     96,452 Restricted equity investments, at cost     92,679     85,689     93,766     105,305 Loans receivable, net of allowance for loan credit losses of $68,839 at June 30, 2024, $67,173 at March 31, 2024, $67,137 at December 31, 2023 and $61,791 at June 30, 2023     9,961,117     10,068,209     10,136,721     10,030,106 Loans held-for-sale     2,062     4,702     5,166     4,200 Interest and dividends receivable     50,976     52,502     51,874     47,933 Premises and equipment, net     117,392     119,211     121,372     124,139 Bank owned life insurance     267,867     266,615     266,498     263,836 Assets held for sale     28     28     28     3,608 Goodwill     506,146     506,146     506,146     506,146 Core deposit intangible     7,859     8,669     9,513     11,476 Other assets     202,972     199,974     179,661     213,432 Total assets   $ 13,321,755   $ 13,418,978   $ 13,538,253   $ 13,538,903 Liabilities and Stockholders' Equity                 Deposits   $ 9,994,017   $ 10,236,851   $ 10,434,949   $ 10,158,337 Federal Home Loan Bank advances     789,337     658,436     848,636     1,091,666 Securities sold under agreements to repurchase with customers     80,000     66,798     73,148     74,452 Other borrowings     424,490     425,722     196,456     195,925 Advances by borrowers for taxes and insurance     25,168     28,187     22,407     27,839 Other liabilities     332,074     337,147     300,712     364,401 Total liabilities     11,645,086     11,753,141     11,876,308     11,912,620 Stockholders' equity:                 OceanFirst Financial Corp. stockholders' equity     1,675,885     1,665,112     1,661,163     1,625,435 Non-controlling interest     784     725     782     848 Total stockholders' equity     1,676,669     1,665,837     1,661,945     1,626,283 Total liabilities and stockholders' equity   $ 13,321,755   $ 13,418,978   $ 13,538,253   $ 13,538,903 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,     2024     2024       2023     2024     2023       |---------------------- (Unaudited) ----------------------|   |---------- (Unaudited) -----------| Interest income:                     Loans   $ 136,049   $ 137,121     $ 129,104     $ 273,170   $ 250,824   Debt securities     19,039     19,861       14,320       38,900     28,606   Equity investments and other     4,338     4,620       6,672       8,958     9,700   Total interest income     159,426     161,602       150,096       321,028     289,130   Interest expense:                     Deposits     60,071     59,855       37,934       119,926     59,264   Borrowed funds     17,092     15,523       20,053       32,615     38,955   Total interest expense     77,163     75,378       57,987       152,541     98,219   Net interest income     82,263     86,224       92,109       168,487     190,911   Provision for credit losses     3,114     591       1,229       3,705     4,242   Net interest income after provision for credit losses     79,149     85,633       90,880       164,782     186,669   Other income:                     Bankcard services revenue     1,571     1,416       1,544       2,987     2,874   Trust and asset management revenue     419     526       645       945     1,257   Fees and service charges     5,015     4,473       5,602       9,488     10,761   Net gain on sales of loans     420     357       33       777     53   Net gain (loss) on equity investments     887     1,923       (559 )     2,810     (7,360 ) Income from bank owned life insurance     1,726     1,862       1,182       3,588     2,463   Commercial loan swap income     241     138       —       379     701   Other     706     1,591       481       2,297     252   Total other income     10,985     12,286       8,928       23,271     11,001   Operating expenses:                     Compensation and employee benefits     33,136     32,759       34,222       65,895     68,142   Occupancy     5,175     5,199       5,265       10,374     10,504   Equipment     1,068     1,130       1,101       2,198     2,306   Marketing     1,175     990       961       2,165     1,943   Federal deposit insurance and regulatory assessments     2,685     3,135       2,465       5,820     4,214   Data processing     6,018     5,956       6,165       11,974     12,319   Check card processing     1,075     1,050       1,214       2,125     2,495   Professional fees     2,161     2,732       5,083       4,893     10,181   Amortization of core deposit intangible     810     844       994       1,654     2,021   Branch consolidation expense, net     —     —       —       —     70   Merger related expenses     —     —       —       —     22   Other operating expense     5,317     4,877       5,460       10,194     10,022   Total operating expenses     58,620     58,672       62,930       117,292     124,239   Income before provision for income taxes     31,514     39,247       36,878       70,761     73,431   Provision for income taxes     7,082     10,637       8,996       17,719     17,650   Net income     24,432     28,610       27,882       53,042     55,781   Net income (loss) attributable to non-controlling interest     59     (57 )     85       2     101   Net income attributable to OceanFirst Financial Corp.     24,373     28,667       27,797       53,040     55,680   Dividends on preferred shares     1,004     1,004       1,004       2,008     2,008   Net income available to common stockholders   $ 23,369   $ 27,663     $ 26,793     $ 51,032   $ 53,672   Basic earnings per share   $ 0.40   $ 0.47     $ 0.45     $ 0.87   $ 0.91   Diluted earnings per share   $ 0.40   $ 0.47     $ 0.45     $ 0.87   $ 0.91   Average basic shares outstanding     58,356     58,789       59,147       58,489     58,988   Average diluted shares outstanding     58,357     58,791       59,153       58,490     59,038   OceanFirst Financial Corp.SELECTED LOAN AND DEPOSIT DATA(dollars in thousands)   LOANS RECEIVABLE     At       June 30,   March 31,   December 31,   September 30,   June 30,         2024       2024       2023       2023       2023   Commercial:                       Commercial real estate - investor     $ 5,324,994     $ 5,322,755     $ 5,353,974     $ 5,334,279     $ 5,319,686   Commercial real estate - owner-occupied     857,710       914,582       943,891       957,216       981,618   Commercial and industrial       616,400       677,176       666,532       652,119       620,284   Total commercial       6,799,104       6,914,513       6,964,397       6,943,614       6,921,588   Consumer:                       Residential real estate       2,977,698       2,965,276       2,979,534       2,928,259       2,906,556   Home equity loans and lines and other consumer ("other consumer")     242,526       245,859       250,664       251,698       255,486   Total consumer       3,220,224       3,211,135       3,230,198       3,179,957       3,162,042   Total loans       10,019,328       10,125,648       10,194,595       10,123,571       10,083,630   Deferred origination costs (fees), net     10,628       9,734       9,263       8,462       8,267   Allowance for loan credit losses       (68,839 )     (67,173 )     (67,137 )     (63,877 )     (61,791 ) Loans receivable, net     $ 9,961,117     $ 10,068,209     $ 10,136,721     $ 10,068,156     $ 10,030,106   Mortgage loans serviced for others   $ 104,136     $ 89,555     $ 68,217     $ 52,796     $ 50,820     At June 30, 2024 Average Yield                     Loan pipeline (1):                       Commercial 7.88 %   $ 166,206     $ 66,167     $ 124,707     $ 50,756     $ 39,164   Residential real estate 6.96       80,330       57,340       49,499       66,682       58,022   Other consumer 8.81