OceanFirst Financial in Toms River, N.J., is absorbing upfront expenses in anticipation of long-term gains from a premier banking push.
The $13.3 billion-asset company said the concierge-heavy model is designed to attract low-cost deposits and complement its commercial and industrial lending operations—particularly in the New York metro market.
As part of this initiative, OceanFirst onboarded nine premier banking teams in April, bringing in nearly 40 experienced bankers with proven track records of managing lower-cost, deposit-rich relationships. The hires are concentrated in Manhattan and Long Island, with another facility planned for Melville, and potential for one or two more as hiring progresses.
“These teams are managing longstanding client relationships, and we believe they’ll deliver substantial new business for OceanFirst over time,” Joseph Lebel, the company’s president, said during an earnings call with analysts. “While the full run rate contribution may take two to three years to materialize, we expect notable progress in the back half of 2025.”
In the near term, OceanFirst is forecasting a 10% increase in quarterly operating expenses, driven in part by the $4 million cost tied to new premier banking hires. However, the company said it could continue hiring, suggesting that expenses could grow incrementally in the short term.
The premier bank model is expected to have a low loan-to-deposit ratio—around 20%—making it a strategic complement to OceanFirst’s traditional C&I book, which tends to carry a much higher loan-to-deposit profile.
Indeed, management expects the margin improvement from Premier Bank to outpace related expense increases within four to five quarters, with full profitability arriving a year later.