OceanFirst Financial (OCFC) - 2025 Q4 - Annual Results

Financial Performance - Net income available to common stockholders for Q4 2025 was $13.1 million, or $0.23 per diluted share, down from $20.9 million, or $0.36 per diluted share in Q4 2024[2]. - Core earnings for Q4 2025 were $23.5 million, or $0.41 per diluted share, an increase from $22.1 million, or $0.38 per diluted share in Q4 2024[3]. - Net income for the year ended December 31, 2025, was $71.027 million, a decrease from $100.390 million in 2024, representing a decline of 29.2%[58]. - Basic earnings per share for the three months ended December 31, 2025, were $0.23, down from $0.30 in the previous quarter, showing a decrease of 23.3%[58]. - Net income attributable to OceanFirst Financial Corp. was $13,093 million for the quarter, compared to $17,330 million in the previous quarter[77]. - Core diluted earnings per share increased to $0.41, up from $0.36 in the previous quarter, marking a growth of 13.9%[83]. Loans and Assets - Total loans increased by $474.0 million, representing an 18% annualized growth rate, with loan originations at $1.05 billion for the quarter[6]. - Total loans receivable as of December 31, 2025, reached $11.032 billion, up from $10.558 billion at the end of the previous quarter, indicating a growth of 4.5%[60]. - Loans receivable net of allowance for loan credit losses increased to $10,970,666 thousand as of December 31, 2025, compared to $10,489,852 thousand on September 30, 2025, and $10,055,429 thousand on December 31, 2024[56]. - The loan pipeline increased by $167.4 million to $474.1 million, primarily due to an increase in the commercial loan pipeline of $267.1 million[33]. - Total assets rose by $1.14 billion to $14.56 billion, driven by a $913.9 million increase in total loans, reaching $11.03 billion[33]. Deposits and Equity - Deposits increased by $898.1 million to $10.96 billion, with time deposits rising by $387.9 million to $2.47 billion, representing 22.5% of total deposits[34]. - Total stockholders' equity decreased to $1.66 billion, primarily due to the redemption of preferred stock for $55.5 million and capital returns[38]. - Total deposits increased to $10,964,405 million as of December 31, 2025, up from $10,435,994 million in the previous quarter, representing a growth of 5.06%[63]. - Total stockholders' equity was $1,662,550 million, slightly up from $1,653,427 million in the previous quarter[77]. - Tangible common equity increased by $24.8 million to $1.14 billion, while the tangible book value per common share increased to $19.79[40]. Operating Expenses - Operating expenses increased to $84.1 million in Q4 2025, impacted by non-core operations of $12.9 million related to restructuring and merger expenses[26]. - Total operating expenses for the three months ended December 31, 2025, were $84.142 million, an increase from $76.327 million in the previous quarter, reflecting an increase of 10.7%[58]. - Operating expenses increased to $296.2 million for the year ended December 31, 2025, compared to $245.9 million in 2024, with non-core operations impacting expenses by $16.9 million[28]. Credit Quality - Provision for credit losses for Q4 2025 was $3.7 million, compared to $3.5 million in Q4 2024[17]. - The allowance for loan credit losses was 0.76% of total loans, up from 0.73% in the previous year, while non-performing loans decreased to $27.8 million, representing 0.25% of total loans[41]. - Non-performing loans decreased to $27,791 million from $41,263 million in the previous quarter, a reduction of 32.5%[65]. - The company reported a total of $2.5 million in non-performing residential and consumer loans sold during the quarter ended December 31, 2025[66]. - The allowance for loan credit losses as a percentage of total non-performing loans was 301.27% as of December 31, 2025[65]. Mergers and Acquisitions - The company announced a merger agreement with Flushing Financial Corporation, expected to close in Q2 2026, subject to regulatory approvals[5]. - The company has proposed a transaction with Flushing Financial Corporation, which is subject to various risks and uncertainties, including regulatory approvals and market conditions[48]. - OceanFirst anticipates filing a registration statement on Form S-4 with the SEC regarding the proposed transaction, which will include a joint proxy statement/prospectus[52]. - The company emphasizes the importance of reading the registration statement and joint proxy statement/prospectus for detailed information about the proposed transaction[53]. Future Outlook - The company plans to host an earnings conference call on January 23, 2026, to discuss financial results and future outlook[45]. - OceanFirst's financial performance estimates may be affected by changes in economic conditions, including inflation and labor shortages[48].