third quarter 2026
Filed Oct 27, 2026OceanFirst Financial Corp. announces third quarter financial results, with GAAP diluted EPS of $0.17 and core diluted EPS of $0.48.
Net interest income, margin, loans and deposits increased, and core earnings rose, but GAAP net income and diluted EPS declined from the prior-year quarter amid $37.1 million of merger-related expenses and a 44.2% effective tax rate.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income available to common stockholders, three months ended September 30, 2026GAAP | $16.46M | – | – |
| Diluted earnings per share, three months ended September 30, 2026GAAP | $ 0.17 | – | – |
| Net income available to common stockholders, nine months ended September 30, 2026GAAP | $33.94M | – | – |
| Diluted earnings per share, nine months ended September 30, 2026GAAP | $ 0.45 | – | – |
| Core earnings, three months ended September 30, 2026non-GAAP | $46.92M | – | – |
| Core earnings diluted earnings per share, three months ended September 30, 2026non-GAAP | $ 0.48 | – | – |
| Core earnings PTPP, three months ended September 30, 2026non-GAAP | $70.81M | – | – |
| Core earnings PTPP diluted earnings per share, three months ended September 30, 2026non-GAAP | $ 0.72 | – | – |
| Net interest income, three months ended September 30, 2026GAAP | $172.1M | – | – |
| Net interest margin, three months ended September 30, 2026GAAP | 3.18 % | – | – |
| Provision for credit losses, three months ended September 30, 2026GAAP | $4.27M | – | – |
| Total other income, three months ended September 30, 2026GAAP | $13.02M | – | – |
| Total operating expenses, three months ended September 30, 2026GAAP | $151.4M | – | – |
| Operating expenses excluding non-core operations, three months ended September 30, 2026non-GAAP | $114.3M | – | – |
| Merger-related expenses, three months ended September 30, 2026GAAP | $37.09M | – | – |
| Effective tax rate, three months ended September 30, 2026GAAP | 44.2% | – | – |
| Total loans, September 30, 2026GAAP | $16.49B | increased $215.7 million, representing a 5% annualized growth rate | – |
| Total deposits, September 30, 2026GAAP | $18.08B | increased $319.3 million | – |
| Total assets, September 30, 2026GAAP | $23.37B | increased by $100.4 million | – |
| Total stockholders' equity, September 30, 2026GAAP | $2.40B | decreased by $15.1 million | – |
| Allowance for loan credit losses as a percent of total loans receivable, September 30, 2026GAAP | 1.29 % | – | – |
| Non-performing loans, September 30, 2026GAAP | $140.7M | – | – |
| Non-performing loans as a percent of total loans receivable, September 30, 2026GAAP | 0.85 | – | – |
| Net loan charge-offs, three months ended September 30, 2026GAAP | −$1.46M | – | – |
| Net loan charge-offs to average total loans, annualized, three months ended September 30, 2026GAAP | 0.04 % | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
fourth quarter of 2026 outlook
- NoteThe Company expects to resume excess capital accretion in the fourth quarter of 2026.
- NoteThe Company expects to realize anticipated cost savings beginning in the fourth quarter of 2026.
Capital returns
- The Board of Directors declared its 119th consecutive quarterly cash dividend on common stock of $0.20 per share, payable on November 20, 2026, to common stockholders and NVCE stockholders of record on November 9, 2026.
- During the nine months ended September 30, 2026, the Company repurchased 415,348 shares of common stock related to exercised options and vesting of employee awards outside of the authorized share repurchase program, at a weighted average cost of $18.76.
- The repurchases, including applicable excise tax, reduced stockholders’ equity by $7.9 million.
- As of September 30, 2026, the Company had 3,226,284 shares available for repurchase under the authorized repurchase programs.
What drove it
- Flushing results from June 1, 2026 through September 30, 2026 were included in consolidated results, while the corresponding prior-year periods did not include Flushing.
- Commercial loan growth was $325.0 million, and commercial loan originations increased 15% to $734.8 million from $641.5 million in the linked quarter.
- Net interest income benefited from the acquisition of Flushing, commercial-loan and securities growth, purchase accounting accretion, prepayment fees, asset repricing and new originations.
- Net interest margin included purchase accounting accretion and prepayment fees of 0.16% and 0.02%, respectively.
- The current quarter included $5.5 million of non-recurring interest income related to payoffs of a non-performing investment and loan acquired from Flushing, including $4.0 million and $1.5 million of interest recoveries, respectively.
- The core system conversion and integration activities were completed in September, enabling elimination of redundant back-office operating expenses and anticipated cost savings beginning in the fourth quarter of 2026.
Concerns
- The current quarter included $37.1 million of non-recurring merger-related expenses, representing $29.4 million net of tax, or $0.30 per share.
- The effective tax rate was 44.2%, adversely impacted by non-deductible merger-related expenses.
- Operating expenses increased to $151.4 million from $76.3 million, with compensation and benefits, amortization of intangibles, data processing, occupancy and other operating expenses increasing primarily due to the Flushing acquisition.
- Non-performing loans increased to $140.7 million from $27.8 million, primarily due to $84.6 million of non-performing loans acquired from Flushing.
- The allowance for loan credit losses as a percentage of total non-performing loans was 150.84%, compared with 301.27%.
- Time deposits increased to $4.35 billion from $2.47 billion and brokered time deposits increased by $439.6 million from December 31, 2025.
- Tangible common equity to tangible assets decreased by 26 basis points during the year to 7.83%.
What to watch
- Realization of anticipated cost savings beginning in the fourth quarter of 2026 following completion of the core conversion and substantially all major integration activities.
- The expected resumption of excess capital accretion in the fourth quarter of 2026.
- Commercial loan growth, commercial loan originations and deposit growth following the full-quarter inclusion of Flushing.
- Net interest margin, including purchase accounting accretion, prepayment fees, recovery of interest income and the cost of deposits and FHLB advances.
- Credit performance of the $727.1 million of PCD loans from the Flushing acquisition and changes in non-performing loans, delinquent loans and the allowance coverage ratio.
Balance sheet and cash flow
- Total assets increased by $100.4 million to $23.37 billion from June 30, 2026.
- Total liabilities increased by $115.6 million to $20.97 billion from June 30, 2026.
- Deposits increased by $319.3 million to $18.1 billion from $17.8 billion from June 30, 2026.
- FHLB advances increased by $42.6 million from June 30, 2026.
- Total loans increased by $215.7 million from June 30, 2026.
- Cash and due from banks was $ 269,825 at September 30, 2026.
- FHLB advances were $ 1,774,967 at September 30, 2026.
- Other borrowings were $ 496,565 at September 30, 2026.
- The loan-to-deposit ratio was 91.2%, as compared to 100.6%.
- The Company’s estimated common equity tier one capital ratio was 10.6% at September 30, 2026.
Analysis
OceanFirst reported third-quarter GAAP net income available to common stockholders of $16.5 million, or $0.17 per diluted share, compared with $17.3 million, or $0.30 per diluted share, in the corresponding prior-year period. The GAAP result included $37.1 million of non-recurring Flushing merger-related expenses, or $29.4 million net of tax and $0.30 per share. Core earnings were $46.9 million, or $0.48 per diluted share, compared with $20.3 million, or $0.36 per diluted share, in the prior-year quarter and $30.5 million, or $0.43 per diluted share, in the linked quarter.
The income statement reflected the Flushing acquisition, completed June 1, 2026, and a full-quarter impact in the September period. Net interest income increased to $172.1 million from $90.7 million year over year and from $120.7 million sequentially. Net interest margin rose to 3.18% from 2.91% and 3.05%, respectively. The current-quarter margin included purchase accounting accretion and prepayment fees of 0.16% and 0.02%, respectively. The Company also received $5.5 million of non-recurring interest income from payoffs of a non-performing investment and loan acquired from Flushing.
Balance-sheet expansion continued sequentially, with total loans up $215.7 million and deposits up $319.3 million to $18.1 billion. Commercial loans drove the expansion, with $325.0 million of commercial loan growth and commercial originations of $734.8 million. The acquisition also materially changed funding and asset mix: time deposits reached $4.35 billion, FHLB advances were $1.77 billion, and the total cost of deposits rose to 2.17% from 2.06% sequentially. Total assets were $23.37 billion and total stockholders' equity was $2.40 billion at September 30, 2026.
Expenses remain the central reported drag on GAAP profitability. Total operating expenses rose to $151.4 million, including $37.0 million of non-core operations primarily related to merger expenses. Excluding non-core operations, operating expenses increased by $41.9 million year over year, largely from compensation and benefits, amortization, data processing, occupancy and other operating expenses associated with Flushing. The 44.2% quarterly effective tax rate was adversely affected by non-deductible merger-related expenses. The Company completed core conversion and integration activities in September and expects cost savings to begin in the fourth quarter of 2026.
Credit costs were contained in the quarter, with a $4.3 million provision and $1.5 million of net loan charge-offs, equivalent to 0.04% of average total loans on an annualized basis. However, reported non-performing loans increased to $140.7 million and represented 0.85% of total loans, principally reflecting $84.6 million of non-performing loans acquired from Flushing. PCD loans from Flushing totaled $727.1 million, excluding the related allowance. Management stated that capital levels remained strong and in excess of well-capitalized regulatory levels, with an estimated common equity tier one capital ratio of 10.6%, and expects excess capital accretion to resume in the fourth quarter of 2026.
Management, verbatim
We are pleased with the increases in margin and profitability and the timely and successful completion of the Flushing integration. The integration of Flushing clients into OceanFirst was executed smoothly, allowing us to deliver a unified operating platform under the OceanFirst Bank brand. This achievement has allowed us to eliminate redundant back-office operating expenses, improve operational efficiencies, and launch our first advertising campaigns in the New York market.
Christopher D. Maher, Chief Executive Officer
With the integration complete, we are focused on leveraging the scale and capabilities of the combined company to enhance the customer experience and support long-term, profitable growth.
Christopher D. Maher, Chief Executive Officer
Not in the filing
stated, not guessed- Total revenue was not reported because the filing presents a bank income statement rather than a revenue line item.
- Segment revenue was not reported.
- Gross margin was not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Quantitative forward revenue, margin, operating-expense and tax-rate guidance was not reported.
- Prior guidance was not provided. તેથી no comparison with prior guidance was available.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.