(Former name, former address and formal fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x NO ¨.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). YES x NO ¨.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨ NO x.

As of ~~August 3,~~November 1, 2005, there were ~~12,755,011~~12,732,782 shares of the Registrant’s Common Stock, par value $.01 per share, outstanding.


	June 30, 2005			December 31, 2004			September 30, 2005			December 31, 2004
	(Unaudited)						(Unaudited)
ASSETS

Cash and due from banks	$	45,832		$	74,021		$	31,614		$	74,021
Investment securities available for sale		85,412			83,960			84,507			83,960
Federal Home Loan Bank of New York stock, at cost		19,500			21,250			19,450			21,250
Mortgage-backed securities available for sale		105,687			124,478			92,571			124,478
Loans receivable, net		1,573,554			1,472,907			1,618,304			1,472,907
Mortgage loans held for sale		71,985			63,961			66,240			63,961
Interest and dividends receivable		6,860			6,033			7,360			6,033
Real estate owned, net		288			288			278			288
Premises and equipment, net		15,795			16,037			15,521			16,037
Servicing asset		9,356			8,790			9,671			8,790
Bank Owned Life Insurance		35,525			34,990			35,846			34,990
Intangible Assets		1,324			1,376
Intangible assets								1,298			1,376
Other assets		6,646			6,184			6,893			6,184

Total assets	$	1,977,764		$	1,914,275		$	1,989,553		$	1,914,275

LIABILITIES AND STOCKHOLDERS’ EQUITY

Deposits	$	1,357,161		$	1,270,535		$	1,369,414		$	1,270,535
Securities sold under agreements to repurchase with retail customers		64,158			45,072			67,727			45,072
Securities sold under agreements to repurchase with the Federal Home Loan Bank		69,000			106,000			59,000			106,000
Federal Home Loan Bank advances		321,000			312,000			330,000			312,000
Subordinated debenture								5,000			—
Advances by borrowers for taxes and insurance		8,760			6,289			8,517			6,289
Other liabilities		22,399			36,423			13,359			36,423

Total liabilities		1,842,478			1,776,319			1,853,017			1,776,319

Stockholders’ equity:
Preferred stock, $.01 par value, 5,000,000 shares authorized, no shares issued		—			—			—			—
Common stock, $.01 par value, 55,000,000 shares authorized, 27,177,372 shares issued and 12,742,633 and 13,024,204 shares outstanding at June 30, 2005 and December 31, 2004, respectively		272			272
Common stock, $.01 par value, 55,000,000 shares authorized, 27,177,372 shares issued and 12,720,732 and 13,024,204 shares outstanding at September 30, 2005 and December 31, 2004, respectively								272			272
Additional paid-in capital		195,915			193,723			196,924			193,723
Retained earnings		160,866			157,575			162,450			157,575
Accumulated other comprehensive loss		(1,011	)		(667	)		(1,256	)		(667	)
Less: Unallocated common stock held by Employee Stock Ownership Plan		(8,061	)		(8,652	)
Treasury stock, 14,434,739 and 14,153,168 shares at June 30, 2005 and December 31, 2004, respectively		(212,695	)		(204,295	)
Less: Unallocated common stock held by
Employee Stock Ownership Plan								(7,766	)		(8,652	)
Treasury stock, 14,456,640 and 14,153,168 shares at September 30, 2005 and December 31, 2004, respectively								(214,088	)		(204,295	)
Common stock acquired by Deferred Compensation Plan								1,365			986
Deferred Compensation Plan Liability								(1,365	)		(986	)

Total stockholders’ equity		135,286			137,956			136,536			137,956

Total liabilities and stockholders’ equity	$	1,977,764		$	1,914,275		$	1,989,553		$	1,914,275


	For the three months ended June 30,					For the six months ended June 30,					For the three months ended September 30,					For the nine months ended September 30,
	2005		2004			2005			2004		2005		2004			2005		2004
	(Unaudited)					(Unaudited)					(Unaudited)					(Unaudited)
Interest income:
Loans	$	22,757	$	20,405		$	44,530		$	40,593	$	24,222	$	21,355		$	68,752	$	61,949
Mortgage-backed securities		967		1,194			2,061			2,050		897		1,170			2,959		3,220
Investment securities and other		1,136		546			2,591			1,532		1,209		662			3,799		2,194

Total interest income		24,860		22,145			49,182			44,175		26,328		23,187			75,510		67,363

Interest expense:
Deposits		5,326		3,490			10,018			6,976		6,056		3,948			16,074		10,925
Borrowed funds		4,605		5,147			9,058			9,931		4,862		4,969			13,921		14,900

Total interest expense		9,931		8,637			19,076			16,907		10,918		8,917			29,995		25,825

Net interest income		14,929		13,508			30,106			27,268		15,410		14,270			45,515		41,538

Provision for loan losses		200		50			250			100		100		50			350		150

Net interest income after provision for loan losses		14,729		13,458			29,856			27,168		15,310		14,220			45,165		41,388

Other income:
Loan servicing income		60		83			101			145		47		125			148		271
Fees and service charges		2,388		2,084			4,570			4,020		2,406		2,150			6,976		6,171
Net gain on sales of loans available for sale		3,204		2,028			6,544			4,359
Net gain on sales of loans and securities available for sale												3,535		2,414			10,079		6,772
Net loss from other real estate operations		—		(3	)		(1	)		—		—		(3	)		—		(3	)
Income from Bank Owned Life Insurance		262		315			535			645		321		260			856		905
Other		4		6			42			13		5		5			47		17

Total other income		5,918		4,513			11,791			9,182		6,314		4,951			18,106		14,133

Operating expenses:
Compensation and employee benefits		7,484		6,494			15,013			13,183		8,206		6,614			23,219		19,797
Occupancy		1,106		919			2,175			1,793		1,109		963			3,284		2,756
Equipment		641		540			1,275			1,084		659		659			1,934		1,743
Marketing		764		442			1,463			645		750		603			2,213		1,248
Federal deposit insurance		128		120			253			240		126		118			379		358
Data processing		773		735			1,556			1,470		857		753			2,413		2,223
General and administrative		2,261		2,428			4,791			4,694		2,485		2,565			7,276		7,259

Total operating expenses		13,157		11,678			26,526			23,109		14,192		12,275			40,718		35,384

Income before provision for income taxes		7,490		6,293			15,121			13,241		7,432		6,896			22,553		20,137
Provision for income taxes		2,615		2,272			5,300			4,741		2,602		2,444			7,902		7,185

Net income	$	4,875	$	4,021		$	9,821		$	8,500	$	4,830	$	4,452		$	14,651	$	12,952

Basic earnings per share	$	0.41	$	0.33		$	0.83		$	0.70	$	0.41	$	0.37		$	1.24	$	1.07

Diluted earnings per share	$	0.40	$	0.32		$	0.80		$	0.67	$	0.40	$	0.35		$	1.20	$	1.02

Average basic shares outstanding		11,818		12,158			11,892			12,161		11,793		12,096			11,859		12,139

Average diluted shares outstanding		12,194		12,656			12,315			12,716		12,184		12,634			12,251		12,686


	Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Employee Stock Ownership Plan			Treasury Stock			Total			Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Employee Stock Ownership Plan			Treasury Stock			Common Stock Acquired by Deferred Compensation Plan		Deferred Compensation Plan Liability			Total
Balance at December 31, 2003	$	272	$	189,615	$	150,804		$	(3,400	)	$	(9,911	)	$	(192,718	)	$	134,662		$	272	$	189,615	$	150,804		$	(3,400	)	$	(9,911	)	$	(192,718	)	$	563	$	(563	)	$	134,662

Comprehensive income:
Net income		—		—		8,500			—			—			—			8,500			—		—		12,952			—			—			—			—		—			12,952
Other comprehensive income:
Unrealized gain on securities (net of tax expense $645)		—		—		—			936			—			—			936
Unrealized gain on securities (net of tax expense $1,767)																					—		—		—			2,558			—			—			—		—			2,558
Reclassification adjustment for gains included in net income (net of tax expense of $65)																					—		—		—			121			—			—			—		—			121

Total comprehensive income																		9,436																								15,631

Tax benefit of stock plans		—		1,373		—			—			—			—			1,373			—		1,494		—			—			—			—			—		—			1,494
Purchase 392,254 shares of common stock		—		—		—			—			—			(9,485	)		(9,485	)
Purchase 558,423 shares of common stock																					—		—		—			—			—			(13,374	)		—		—			(13,374	)
Allocation of ESOP stock		—		—		—			—			630			—			630			—		—		—			—			944			—			—		—			944
ESOP adjustment		—		1,173		—			—			—			—			1,173			—		1,721		—			—			—			—			—		—			1,721
Cash dividend - $.40 per share		—		—		(4,879	)		—			—			—			(4,879	)
Cash dividend - $.60 per share																					—		—		(7,294	)		—			—			—			—		—			(7,294	)
Exercise of stock options		—		—		(1,175	)		—			—			3,753			2,578			—		—		(1,439	)		—			—			4,534			—		—			3,095
Purchase of stock for the deferred compensation plan																					—		—		—			—			—			—			414		(414	)		—

Balance at June 30, 2004	$	272	$	192,161	$	153,250		$	(2,464	)	$	(9,281	)	$	(198,450	)	$	135,488
Balance at September 30, 2004																				$	272	$	192,830	$	155,023		$	(721	)	$	(8,967	)	$	(201,558	)	$	977	$	(977	)	$	136,879

Balance at December 31, 2004	$	272	$	193,723	$	157,575		$	(667	)	$	(8,652	)	$	(204,295	)	$	137,956		$	272	$	193,723	$	157,575		$	(667	)	$	(8,652	)	$	(204,295	)	$	986	$	(986	)	$	137,956

Comprehensive income:
Net income		—		—		9,821			—			—			—			9,821			—		—		14,651			—			—			—			—		—			14,651
Other comprehensive income:
Unrealized loss on securities (net of tax benefit $237)		—		—		—			(344	)		—			—			(344	)
Unrealized loss on securities (net of tax benefit $405)																					—		—		—			(589	)		—			—			—		—			(589	)

Total comprehensive income																		9,477																								14,062

Stock award		—		103		—						—			—			103			—		103		—						—			—			—		—			103
Tax benefit of stock plans		—		1,089		—			—			—			—			1,089			—		1,561		—			—			—			—								1,561
Purchase 504,013 shares of common stock		—		—		—			—			—			(11,586	)		(11,586	)
Purchase 611,566 shares of common stock																					—		—		—			—			—			(14,096	)		—		—			(14,096	)
Allocation of ESOP stock		—		—		—			—			591			—			591			—		—		—			—			886			—			—		—			886
ESOP adjustment		—		1,000		—			—			—			—			1,000			—		1,537		—			—			—			—			—		—			1,537
Cash dividend - $.40 per share		—		—		(4,775	)		—			—			—			(4,775	)
Cash dividend - $.60 per share																					—		—		(7,120	)		—			—			—								(7,120	)
Exercise of stock options		—		—		(1,755	)		—			—			3,186			1,431			—		—		(2,656	)		—			—			4,303			—		—			1,647

Balance at June 30, 2005	$	272	$	195,915	$	160,866		$	(1,011	)	$	(8,061	)	$	(212,695	)	$	135,286
Purchase of stock for the deferred compensation plan																					—		—		—			—			—			—			379		(379	)		—

Balance at September 30, 2005																				$	272	$	196,924	$	162,450		$	(1,256	)	$	(7,766	)	$	(214,088	)	$	1,365	$	(1,365	)	$	136,536


	For the six months ended June 30,						For the nine months ended September 30,
	2005			2004			2005			2004
	(Unaudited)						(Unaudited)
Cash flows from operating activities:
Net income	$	9,821		$	8,500		$	14,651		$	12,952

Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization of premises and equipment		1,027			1,012			1,534			1,534
Amortization of ESOP		591			630			886			944
ESOP adjustment		1,000			1,173			1,537			1,721
Tax benefit of stock plans		1,089			1,373			1,561			1,494
Stock award		103			—			103			—
Amortization of servicing asset		1,123			947			1,719			1,377
Amortization of intangible assets		52			53			78			79
Net premium amortization in excess of discount accretion on securities		471			625			655			983
Net amortization of deferred fees and discounts on loans		317			128			312			70
Provision for loan losses		250			100			350			150
Net gain on sales of real estate owned		—			(5	)		—			(5	)
Net gain on sale of fixed assets		(28	)		—			(28	)		—
Net gain on sales of loans		(6,544	)		(4,359	)
Net gain on sales of loans and securities								(10,079	)		(6,772	)
Proceeds from sales of mortgage loans held for sale		333,185			172,933			549,413			322,888
Mortgage loans originated for sale		(336,354	)		(195,581	)		(544,213	)		(360,251	)
Increase in value of Bank Owned Life Insurance		(535	)		(645	)		(856	)		(905	)
Death benefit on Bank Owned Life Insurance								—			213
Increase in interest and dividends receivable		(827	)		(757	)		(1,327	)		(1,213	)
Increase in other assets		(224	)		(770	)		(304	)		(393	)
Decrease in other liabilities		(14,026	)		(385	)
(Decrease) increase in other liabilities								(23,064	)		6,324

Total adjustments		(19,330	)		(23,528	)		(21,723	)		(31,762	)

Net cash used in operating activities		(9,509	)		(15,028	)		(7,072	)		(18,810	)

Cash flows from investing activities:
Net increase in loans receivable		(101,214	)		(34,258	)		(146,059	)		(73,972	)
Proceeds from sale of investment securities available for sale								—			546
Purchase of investment securities available for sale		(2,043	)		(802	)		(4,427	)		(802	)
Purchase of mortgage-backed securities available for sale		—			(82,844	)		—			(82,844	)
Proceeds from maturities of investment securities available for sale		—			1,755			3,670			2,116
Principal payments on mortgage-backed securities available for sale		18,331			21,112			30,468			33,540
Decrease (increase) in Federal Home Loan Bank of New York stock		1,750			(4,540	)		1,800			(4,065	)
Proceeds from sales of real estate owned		—			257			10			257
Proceeds from sale of fixed assets		49			—			49			—
Purchases of premises and equipment		(806	)		(725	)		(1,039	)		(1,201	)

Net cash used in investing activities		(83,933	)		(100,045	)		(115,528	)		(126,425	)


	For the six months ended June 30,						For the nine months ended September 30,
	2005			2004			2005			2004
	(Unaudited)						(Unaudited)
Cash flows from financing activities:
Increase in deposits	$	86,626		$	43,458		$	98,879		$	89,072
Increase in short-term borrowings		38,086			13,246			47,655			14,183
Proceeds from securities sold under agreements to repurchase with the Federal Home Loan Bank		—			40,000			—			44,000
Repayments from securities sold under agreements to repurchase with the Federal Home Loan Bank		(11,000	)		(6,000	)		(11,000	)		(12,000	)
Proceeds from Federal Home Loan Bank advances		24,000			74,000			34,000			110,000
Repayments of Federal Home Loan Bank advances		(60,000	)		(26,000	)		(77,000	)		(80,000	)
Proceeds from subordinated debenture								5,000			—
Increase in advances by borrowers for taxes and insurance		2,471			792			2,228			224
Exercise of stock options		1,431			2,578			1,647			3,095
Dividends paid		(4,775	)		(4,879	)		(7,120	)		(7,294	)
Purchase of treasury stock		(11,586	)		(9,485	)		(14,096	)		(13,374	)

Net cash provided by financing activities		65,253			127,710			80,193			147,906

Net (decrease) increase in cash and due from banks		(28,189	)		12,637			(42,407	)		2,671

Cash and due from banks at beginning of period		74,021			36,172			74,021			36,172

Cash and due from banks at end of period	$	45,832		$	48,809		$	31,614		$	38,843

Supplemental Disclosure of Cash Flow Information:
Supplemental Disclosure of Cash Flow
Information:
Cash paid during the period for:
Interest	$	19,421		$	16,615		$	30,524		$	25,743
Income taxes		9,033			7,163			17,019			7,274
Non cash activities:
Transfer of loans receivable to real estate owned								—			320
Transfer of securities sold under agreements to repurchase to advances		26,000			10,000			36,000			10,000
Mortgage loans securitized into mortgage-backed securities							$	—		$	15,807

The accompanying unaudited consolidated financial statements include the accounts of OceanFirst Financial Corp. (the “Company”) and its wholly-owned subsidiary, OceanFirst Bank (the “Bank”) and its wholly-owned subsidiaries, Columbia Home Loans, LLC, OceanFirst REIT Holdings, Inc. and OceanFirst Services, LLC.

The interim consolidated financial statements reflect all normal and recurring adjustments which are, in the opinion of management, considered necessary for a fair presentation of the financial condition and results of operations for the periods presented. The results of operations for the three and ~~six~~nine months ended ~~June~~September 30, 2005 are not necessarily indicative of the results of operations that may be expected for all of 2005.

Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report to Stockholders on Form 10-K for the year ended December 31, 2004.

The Company accounts for stock-based compensation using the intrinsic value method under Accounting Principles Board Opinion No. 25 and accordingly has recognized no compensation expense under this method. Statement of Financial Accounting Standard No. 123, “Accounting for Stock-based Compensation” as amended by Statement of Financial Accounting Standard No. 148, “Accounting for Stock-based Compensation-Transition and Disclosure”, permits the use of the intrinsic value method; however, the amended statement requires the Company to disclose the pro forma net income and earnings per share as if the stock-based compensation had been accounted for using the fair value method. Had the compensation costs for the Company’s stock option plan been determined based on the fair value method, the Company’s net income and earnings per share would have been reduced to the pro forma amounts indicated below (in thousands, except per share data):


	Three months ended June 30,						Six months ended June 30,						Three months ended September 30,						Nine months ended September 30,
	2005			2004			2005			2004			2005			2004			2005			2004
Net income – as reported	$	4,875		$	4,021		$	9,821		$	8,500		$	4,830		$	4,452		$	14,651		$	12,952

Stock-based compensation expense included in reported net income, net of related tax effects		15			—			67			—			—			—			67			—
Total stock-based compensation expense determined under the fair value based method, net of related tax effects		(186	)		(135	)		(407	)		(255	)		(171	)		(166	)		(578	)		(413	)

Net stock-based compensation expense not included in reported net income, all relating to stock option grants, net of related tax effects.		(171	)		(135	)		(340	)		(255	)		(171	)		(166	)		(511	)		(413	)

Net income – pro forma	$	4,704		$	3,886		$	9,481		$	8,245		$	4,659		$	4,286		$	14,140		$	12,539

Basic earnings per share:
As reported	$	.41		$	.33		$	.83		$	.70		$	.41		$	.37		$	1.24		$	1.07

Pro forma	$	.40		$	.32		$	.80		$	.68		$	.40		$	.35		$	1.19		$	1.03

Diluted earnings per share:
As reported	$	.40		$	.32		$	.80		$	.67		$	.40		$	.35		$	1.20		$	1.02

Pro forma	$	.39		$	.31		$	.77		$	.65		$	.38		$	.34		$	1.15		$	.99

The following reconciles shares outstanding for basic and diluted earnings per share for the three and ~~six~~nine months ended ~~June~~September 30, 2005 and 2004 (in thousands):


	Three months ended June 30,				Six months ended June 30,				Three months ended September 30,				Nine months ended September 30,
	2005		2004		2005		2004		2005		2004		2005		2004
Weighted average shares issued net of Treasury shares	12,810		13,309		12,905		13,333		12,748		13,208		12,852		13,291
Less: Unallocated ESOP shares	(974	)	(1,119	)	(991	)	(1,138	)	(939	)	(1,082	)	(974	)	(1,119	)
Unallocated incentive award shares	(18	)	(32	)	(22	)	(34	)	(16	)	(30	)	(19	)	(33	)

Average basic shares outstanding	11,818		12,158		11,892		12,161		11,793		12,096		11,859		12,139
Add: Effect of dilutive securities:
Stock options	361		473		406		528		378		514		377		521
Incentive awards	15		25		17		27		13		24		15		26

Average diluted shares outstanding	12,194		12,656		12,315		12,716		12,184		12,634		12,251		12,686

For the three month periods ended ~~June~~September 30, 2005 and 2004, total comprehensive income, representing net income plus or minus the change in unrealized gains or losses on securities available for sale amounted to ~~$5,411,000~~$4,585,000 and ~~$2,291,000,~~$6,195,000, respectively. For the ~~six~~nine months ended ~~June~~September 30, 2005 and 2004, total comprehensive income amounted to ~~$9,477,000~~$14,062,000 and ~~$9,436,000,~~$15,631,000, respectively.

Loans receivable, net at ~~June~~September 30, 2005 and December 31, 2004 consisted of the following (in thousands):


	June 30, 2005			December 31, 2004			September 30, 2005			December 31, 2004
Real estate:
One- to four-family	$	1,183,007		$	1,126,585		$	1,190,041		$	1,126,585
Commercial real estate, multi- family and land		270,643			243,299
Commercial real estate, multi-family and land								279,719			243,299
Construction		15,554			19,189			19,142			19,189
Consumer		124,536			99,279			139,889			99,279
Commercial		64,207			61,290			68,888			61,290

Total loans		1,657,947			1,549,642			1,697,679			1,549,642

Loans in process		(5,882	)		(5,970	)		(7,112	)		(5,970	)
Deferred origination costs, net		3,991			3,888			4,390			3,888
Unearned discount		(3	)		(4	)		(3	)		(4	)
Allowance for loan losses		(10,514	)		(10,688	)		(10,410	)		(10,688	)

Total loans, net		1,645,539			1,536,868			1,684,544			1,536,868

Less: Mortgage loans held for sale		71,985			63,961			66,240			63,961

Loans receivable, net	$	1,573,554		$	1,472,907		$	1,618,304		$	1,472,907

The major types of deposits at ~~June~~September 30, 2005 and December 31, 2004 were as follows (in thousands):


	June 30, 2005		December 31, 2004		September 30, 2005		December 31, 2004
Type of Account

Non-interest-bearing	$	125,928	$	106,492	$	122,326	$	106,492
Interest-bearing checking accounts		332,233		297,919		374,026		297,919
Money market deposit		138,503		142,893		131,133		142,893
Savings		262,306		250,032		256,362		250,032
Time deposits		498,191		473,199		485,567		473,199

	$	1,357,161	$	1,270,535	$	1,369,414	$	1,270,535

On April 14, 2005 the Securities and Exchange Commission amended the compliance dates for the Financial Accounting Standard Board’s Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (Statement No. 123R). The Commission’s new rule allows companies to implement Statement No. 123R at the beginning of the next fiscal year, instead of the ~~next~~ reporting period that begins after June 15, 2005, or December 15, 2005 for small business issuers. The Commission’s new rule does not change the accounting required by Statement No. 123R; it changes only the dates for compliance with the standard. The Company is currently evaluating the transition provisions of Statement 123R and does not know the impact on the consolidated financial statements at this time.

In May 2005, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (“SFAS”) No. 154, “Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement No. 3.” SFAS No. 154 requires retroactive application to prior periods’ financial ~~statement~~statements of a voluntary change in accounting principle unless it is impracticable. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, with earlier application permitted for accounting changes and corrections of errors made ~~occurring~~ in fiscal years beginning after ~~June 1,~~May 31, 2005.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Note 1 to the Company’s Audited Consolidated Financial Statements for the year ended December 31, 2004 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004, as supplemented by this report, contains a summary of significant accounting policies. Various elements of these accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. Certain assets are carried in the consolidated statements of financial condition at fair value or the lower of cost or fair value. Policies with respect to the methodologies used to determine the allowance for loan losses, the valuation of Mortgage Servicing Rights and judgments regarding securities impairment are the most critical accounting policies because they are important to the presentation of the Company’s financial condition and results of operations, involve a higher degree of complexity and require management to make difficult and subjective judgments which often require assumptions or estimates about highly uncertain matters. The use of different judgments, assumptions and estimates could result in material differences in the results of operations or financial condition. These critical accounting policies and their application are reviewed periodically and, at least annually, with the Audit Committee of the Board of Directors.

The Company’s results of operations are dependent primarily on net interest income, which is the difference between the interest income earned on the Company’s interest-earning assets, such as loans and investments, and the interest expense on its interest-bearing liabilities, such as deposits and borrowings. The Company also generates non-interest income such as income from loan sales, loan

servicing, loan originations, merchant credit card services, deposit accounts, the sale of alternative investments, trust and asset management services and other fees. The Company’s operating expenses primarily consist of compensation and employee benefits, occupancy and equipment, marketing, data

processing and other general and administrative expenses. The Company’s results of operations are also significantly affected by general economic and competitive conditions, particularly changes in market interest rates, government policies and actions of regulatory agencies.

After declining to relatively low levels in early 2004, interest rates have steadily risen over the past year, especially at the shorter end of the yield curve. The previously low interest rate environment generally had an adverse effect on the Company’s operating results. Prepayments on loans and mortgage-backed securities caused asset yields to decline at a faster rate than the cost of liabilities, causing the Company’s net interest margin to contract. The more recent rising rate environment reduced prepayment activity and caused the Company’s net interest margin to expand. However, recent increases in short-term interest rates have outpaced increases in longer-term rates resulting in a continued flattening of the interest rate yield curve. The continuation of a flat yield curve through the remainder of 2005 and into 2006 is expected to have a negative impact on the Company’s results of operations and net interest margin as interest-earning assets, both loans and securities, are priced against longer-term indices, while interest-bearing liabilities, primarily deposits and borrowings, are priced against shorter-term indices. The Company has generally not repriced all core deposits (defined as all deposits other than time deposits) in line with the market increases in short-term interest rates. The likely upward repricing of core deposits is also expected to have a negative impact on the Company’s results of operations and net interest margin.

The Company continues to focus on growing loans receivable, while limiting credit and interest rate risk exposure. The Company opened a joint residential/commercial loan production office in Monmouth County in late 2004. In the third quarter of 2004, the Company expanded its loan production platform through the acquisition of a consumer direct lending operation by Columbia Home Loans, LLC, the Company’s mortgage banking subsidiary. The acquisition increased the volume of loans sold by the Company and the related gain on sale and was also partially responsible for the increase in operating expenses.

While the Company continues to focus on growing core deposits ~~(defined as all deposits other than time deposits)~~ the rise in interest rates and the muted reaction of competitors to those interest rate changes provided the Company with an opportunity to be more competitive in the market for time deposits within established pricing guidelines. Both core and time deposit balances increased ~~over the past year.~~during 2005. Deposit growth also benefited from the opening of the Company’s eighteenth branch office in Freehold late in the first quarter of 2005. The Company has committed to the opening of new branch offices in Little Egg Harbor, expected to open in mid 2006, and Wall, expected to open in mid 2007. Additionally, in early 2006 the Whiting branch is expected to be relocated to a more convenient and prominent location.

Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities. Net interest income also depends upon the relative amounts of interest-earning assets and interest-bearing liabilities and the interest rate earned or paid on them.

The following table sets forth certain information relating to the Company for the three and ~~six~~nine months ended ~~June~~September 30, 2005 and 2004. The yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods shown except where noted otherwise. Average balances are derived from average daily balances. The yields and costs include certain fees which are considered adjustments to yields.


	FOR THE THREE MONTHS ENDED SEPTEMBER 30,
	2005						2004
	AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST		AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST
	(Dollars in thousands)
Assets
Interest-earnings assets:
Interest-earning deposits and short-term investments	$	8,846	$	76	3.44	%	$	11,990	$	38	1.27	%
Investment securities (1)		85,978		887	4.13			85,236		502	2.36
FHLB stock		19,596		246	5.02			23,199		122	2.10
Mortgage-backed securities (1)		100,549		897	3.57			142,405		1,170	3.29
Loans receivable, net (2)		1,663,158		24,222	5.83			1,500,727		21,355	5.69

Total interest-earning assets		1,878,127		26,328	5.61			1,763,557		23,187	5.26

Non-interest-earning assets		99,493						100,517

Total assets	$	1,977,620					$	1,864,074

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Transaction deposits	$	749,488		2,193	1.17		$	681,079		1,074	0.63
Time deposits		489,411		3,863	3.16			427,289		2,874	2.69

Total		1,238,899		6,056	1.96			1,108,368		3,948	1.42
Borrowed funds		459,736		4,862	4.23			492,253		4,969	4.04

Total interest-bearing liabilities		1,698,635		10,918	2.57			1,600,621		8,917	2.23

Non-interest-bearing deposits		127,718						116,721
Non-interest-bearing liabilities		16,468						11,821

Total liabilities		1,842,821						1,729,163
Stockholders’ equity		134,799						134,911

Total liabilities and stockholders’ equity	$	1,977,620					$	1,864,074

Net interest income			$	15,410					$	14,270

Net interest rate spread (3)					3.04	%					3.03	%

Net interest margin (4)					3.28	%					3.24	%


	FOR THE SIX MONTHS ENDED JUNE 30,												FOR THE NINE MONTHS ENDED SEPTEMBER 30,
	2005						2004						2005						2004
	AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST		AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST		AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST		AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST
	(Dollars in thousands)												(Dollars in thousands)
Assets
Interest-earnings assets:
Interest-earning deposits and short term investments	$	14,358	$	194	2.70	%	$	9,957	$	50	1.00	%
Interest-earning deposits and short-term investments													$	12,231	$	269	2.93	%	$	10,736	$	88	1.09	%
Investment securities (1)		86,422		1,995	4.62			85,519		1,327	3.10			86,272		2,882	4.45			85,417		1,829	2.86
FHLB stock		20,086		402	4.00			22,186		155	1.40			19,921		648	4.34			22,532		277	1.64
Mortgage-backed securities (1)		116,747		2,061	3.53			123,739		2,050	3.31			111,288		2,959	3.55			130,392		3,220	3.29
Loans receivable, net (2)		1,568,749		44,530	5.68			1,437,748		40,593	5.65			1,600,564		68,752	5.73			1,460,249		61,949	5.66

Total interest-earning assets		1,806,362		49,182	5.45			1,679,149		44,175	5.26			1,830,276		75,510	5.50			1,709,326		67,363	5.25

Non-interest earning assets		101,430						95,499
Non-interest-earning assets														101,048						97,374

Total assets	$	1,907,792					$	1,774,648					$	1,931,324					$	1,806,700

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Transaction deposits	$	725,381		3,334	0.92		$	667,169		1,892	0.57		$	733,548		5,526	1.00		$	672,740		2,967	0.59
Time deposits		474,649		6,684	2.82			385,066		5,084	2.64			479,624		10,548	2.93			400,208		7,958	2.65

Total		1,200,030		10,018	1.67			1,052,235		6,976	1.33			1,213,172		16,074	1.77			1,072,948		10,925	1.36
Borrowed funds		443,222		9,058	4.09			472,969		9,931	4.20			448,787		13,921	4.14			480,011		14,900	4.14

Total interest-bearing liabilities		1,643,252		19,076	2.32			1,525,204		16,907	2.22			1,661,959		29,995	2.41			1,552,959		25,825	2.22

Non-interest-bearing deposits		114,995						102,659						119,236						107,347
Non-interest bearing liabilities		14,052						12,211
Non-interest-bearing liabilities														15,117						12,069

Total liabilities		1,772,299						1,640,074						1,796,312						1,672,375
Stockholders’ equity		135,493						134,574						135,012						134,325

Total liabilities and stockholders’ equity	$	1,907,792					$	1,774,648					$	1,931,324					$	1,806,700

Net interest income			$	30,106					$	27,268					$	45,515					$	41,538

Net interest rate spread (3)					3.13	%					3.04	%					3.09	%					3.03	%

Net interest margin (4)					3.33	%					3.25	%					3.32	%					3.24	%

Comparison of Financial Condition at ~~June~~September 30, 2005 and December 31, 2004

Total assets at ~~June~~September 30, 2005 were ~~$1.978~~$1.990 billion, an increase of ~~$63.5~~$75.3 million, compared to $1.914 billion at December 31, 2004.

Mortgage-backed securities decreased $31.9 million as cash flow from these securities was used to fund loan growth. Loans receivable, net increased by ~~$100.6~~$145.4 million to a balance of ~~$1.574~~$1.618 billion at ~~June~~September 30, 2005, compared to a balance of $1.473 billion at December 31, 2004. Commercial and commercial real estate loans outstanding increased ~~$30.3~~$44.0 million.

Deposit balances increased ~~$86.6~~$98.9 million to ~~$1.357~~$1.369 billion at ~~June~~September 30, 2005 from $1.271 billion at December 31, 2004. Core deposits (all deposits except time deposits), a key emphasis for the Company, increased by ~~$61.6~~$86.5 million, while time deposits also increased by ~~$25.0~~$12.4 million.

Total Federal Home Loan Bank borrowings, consisting of securities sold under agreements to repurchase and advances, decreased ~~$28.0~~$29.0 million to ~~$390.0~~$389.0 million at ~~June~~September 30, 2005, compared to a balance of $418.0 million at December 31, 2004. The Company utilized excess cash and due from bank balances and deposit flows to ~~retire the~~reduce Federal Home Loan Bank borrowings. During the quarter the Company issued subordinated debt for $5.0 million, the proceeds of which were partly used to fund the Company’s common stock repurchase program.

Stockholders’ equity at ~~June~~September 30, 2005 decreased to ~~$135.3~~$136.5 million, compared to $138.0 million at December 31, 2004. The Company repurchased ~~504,013~~611,566 shares of common stock during the ~~six~~nine months ended ~~June~~September 30, 2005 at a total cost of ~~$11.6~~$14.1 million. Under the 10% repurchase program authorized by the Board of Directors in October 2003, ~~246,042~~138,489 shares remain to be purchased as of ~~June~~September 30, 2005. A new repurchase program, the Company’s twelfth, was announced on October 19, 2005. Under this 5% repurchase program, an additional 636,036 shares are available for repurchase. The cost of the share repurchases was partly offset by net income, proceeds from stock option exercises and the related tax benefit, and Employee Stock Ownership Plan amortization.

Comparison of Operating Results for the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2005 and ~~June~~September 30, 2004

Net income increased to ~~$4.9~~$4.8 million and ~~$9.8~~$14.7 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to net income of ~~$4.0~~$4.5 million and ~~$8.5~~$13.0 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2004. Diluted earnings per share increased to $.40 and ~~$.80,~~$1.20, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to ~~$.32~~$.35 and ~~$.67,~~$1.02, respectively, for the same prior year periods. Earnings per share was favorably affected by the Company’s repurchase program, which reduced the average diluted shares outstanding.

Interest income for the three and ~~six~~nine months ended ~~June~~September 30, 2005 was ~~$24.9~~$26.3 million and ~~$49.2~~$75.5 million, respectively, compared to ~~$22.1~~$23.2 million and ~~$44.2~~$67.4 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2004. The yield on interest-earning assets increased to ~~5.45%~~5.61% and 5.50%, respectively, for ~~both~~ the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to ~~5.16%~~5.26% and ~~5.26%~~5.25%, respectively, for the same prior year periods. Average interest-earning assets increased by ~~$104.8~~$114.6 million and ~~$127.2~~$121.0 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005 as compared to the same prior year periods. The growth was concentrated in average loans receivable which grew ~~$140.3~~$162.4 million, or ~~9.7%~~10.8%, for the three months ended ~~June~~September 30, 2005 as compared to the same prior year period. For the ~~six~~nine months ended ~~June~~September 30, 2005 average loans receivable increased ~~$131.0~~$140.3 million, or ~~9.1%~~9.6%, as compared to the same prior year period.

Interest expense for the three and ~~six~~nine months ended ~~June~~September 30, 2005 was ~~$9.9~~$10.9 million and ~~$19.1~~$30.0 million, respectively, compared to ~~$8.6~~$8.9 million and ~~$16.9~~$25.8 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2004. The cost of interest-bearing liabilities increased to ~~2.40%~~2.57% and ~~2.32%~~2.41%, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to 2.23% and 2.22%, respectively, in the same prior year periods. Average interest-bearing liabilities increased by ~~$100.1~~$98.0 million and ~~$118.0~~$109.0 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005 as compared to the same prior year periods. The growth was concentrated in interest-bearing deposits which grew ~~$156.9~~$130.5 million, or ~~14.8%~~11.8% for the three months ended ~~June~~September 30, 2005 as compared to the same prior year period. For the ~~six~~nine months ended ~~June 20,~~September 30, 2005 average interest-bearing deposits increased ~~$147.8~~$140.2 million, or ~~14.0%~~13.1%, as compared to the same prior year period.

Net interest income for the three and ~~six~~nine months ended ~~June~~September 30, 2005 increased to ~~$14.9~~$15.4 million and ~~$30.1~~$45.5 million, respectively, as compared to ~~$13.5~~$14.3 million and ~~$27.3~~$41.5 million, respectively, in the same prior year periods. The net interest margin increased to 3.28% and ~~3.33%~~3.32%, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005 from ~~3.14% and 3.25%, respectively,~~3.24% in each of the same prior year periods. Net interest income benefited from the wider net interest margin and the increase in average interest-earning assets as noted above.

For the three and ~~six~~nine months ended ~~June~~September 30, 2005, the Company’s provision for loan losses was ~~$200,000~~$100,000 and ~~$250,000,~~$350,000, respectively, as compared to $50,000 and ~~$100,000~~$150,000 for the same prior year periods. Total loans receivable increased and net charge-offs for the three and ~~six~~nine months ended ~~June~~September 30, 2005 increased to ~~$422,000~~$204,000 and ~~$425,000,~~$628,000, respectively, from ~~no net charge-offs~~$126,000 and ~~a $49,000 net recovery,~~$77,000, respectively, for the same prior year periods. Non-performing loans, however, decreased to ~~$2.1~~$1.4 million at ~~June~~September 30, 2005 from $3.5 million at December 31, 2004 and ~~$3.6~~$4.0 million at ~~June~~September 30, 2004.

Other income was ~~$5.9~~$6.3 million and ~~$11.8~~$18.1 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, compared to ~~$4.5~~$5.0 million and ~~$9.2~~$14.1 million, respectively, for the same prior year periods. For the three and ~~six~~nine months ended ~~June~~September 30, 2005, the Company recorded gains of ~~$3.2~~$3.5 million and ~~$6.5~~$10.1 million, respectively, on the sale of loans and securities available for sale, as compared to gains of ~~$2.0~~$2.4 million and ~~$4.4~~$6.8 million, respectively, in the same prior year periods. For the three and nine months ended September 30, 2004, the gain on sale of loans and securities includes a gain of $186,000 on the sale of equity securities. Loans sold for the three and ~~six~~nine month period ended ~~June~~September 30, 2005 increased to ~~$166.1~~$212.4 million and ~~$326.6~~$539.3 million, respectively, from ~~$100.1~~$162.2 million and ~~$168.6~~$316.1 million, respectively, in the same prior year periods. In the third quarter of 2004, the Company expanded its loan production platform through the acquisition of a consumer direct lending operation by Columbia Home Loans, LLC. Fees and service charges increased ~~$304,000~~$256,000 and ~~$550,000,~~$805,000, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to the same prior year periods primarily related to increases in investment services and trust fees.

Operating expenses were ~~$13.2~~$14.2 million and ~~$26.5~~$40.7 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to ~~$11.7~~$12.3 million and ~~$23.1~~$35.4 million, respectively, in the same prior year periods. The increase was primarily due to the costs related to the third quarter 2004 acquisition of a consumer direct lending ~~operation.~~operation, as well as increased incentive plan costs.

Income tax expense was $2.6 million and ~~$5.3~~$7.9 million, respectively, for the three and ~~six~~nine months ended ~~June~~September 30, 2005, as compared to ~~$2.3~~$2.4 million and ~~$4.7~~$7.2 million, respectively, for the same prior year periods. The effective tax rates decreased slightly to ~~34.9% and 35.1%, respectively,~~35.0% for the three and ~~six~~nine months ended ~~June~~September 30, 2005 as compared to ~~36.1%~~35.4% and ~~35.8%~~35.7%, respectively, for the same prior year periods.

The Company’s primary sources of funds are deposits, principal and interest payments on loans and mortgage-backed securities, proceeds from the sale of loans, Federal Home Loan Bank (“FHLB”) and other borrowings and, to a lesser extent, investment maturities. While scheduled amortization of loans is a predictable source of funds, deposit flows and mortgage prepayments are greatly influenced by general interest rates, economic conditions and competition. The Company has other sources of liquidity if a need for additional funds arises, including an overnight line of credit and advances from the FHLB.

At ~~June~~September 30, 2005 the Company had outstanding overnight borrowings from the FHLB of ~~$19.0~~$25.0 million as compared to no outstanding overnight borrowings at December 31, 2004. The Company utilizes the overnight line from time to time to fund short-term liquidity needs. The Company had total FHLB borrowings, including overnight borrowings, of ~~$390.0~~$389.0 million at ~~June~~September 30, 2005, a decrease from $418.0 million at December 31, 2004. The decrease in borrowings was funded by a reduction in cash and due from banks and increased deposits.

The Company’s cash needs for the ~~six~~nine months ended ~~June~~September 30, 2005, were primarily satisfied by principal payments on loans and mortgage-backed securities, increased deposits and proceeds from the sale of mortgage loans held for sale. The cash was principally utilized for loan originations ~~a reduction in total borrowings~~ and the repurchase of common stock. For the ~~six~~nine months ended ~~June~~September 30, 2004, the cash needs of the Company were primarily satisfied by principal payments on loans and mortgage-backed securities, increased deposits, increased total borrowings and proceeds from the sale of mortgage loans held for sale. The cash provided was principally used for the origination of loans, the purchase of mortgage-backed securities and the repurchase of common stock.

In the normal course of business, the Company routinely enters into various commitments, primarily relating to the origination and sale of loans. At ~~June~~September 30, 2005, outstanding commitments to originate loans totaled ~~$261.8~~$214.9 million; outstanding unused lines of credit totaled ~~$160.1~~$167.6 million; and outstanding commitments to sell loans totaled ~~$97.3~~$96.8 million. The Company expects to have sufficient funds available to meet current commitments in the normal course of business.

Time deposits scheduled to mature in one year or less totaled ~~$303.0~~$306.5 million at ~~June~~September 30, 2005. Based upon historical experience management estimates that a significant portion of such deposits will remain with the Company.

Under the Company’s stock repurchase programs, shares of OceanFirst Financial Corp. common stock may be purchased in the open market and through other privately negotiated transactions, from time-to-time, depending on market conditions. The repurchased shares are held as treasury stock for general corporate use. For the ~~six~~nine months ended ~~June~~September 30, 2005, the Company purchased ~~504,013~~611,566 shares of common stock at a total cost of ~~$11.6~~$14.1 million compared with purchases of ~~392,254~~558,423 shares for the ~~six~~nine months ended ~~June~~September 30, 2004 at an aggregate cost of ~~$9.5~~$13.4 million. At ~~June~~September 30, 2005, there were ~~246,042~~138,489 shares remaining to be repurchased under the existing stock repurchase program. A new repurchase program was announced on October 19, 2005. Under this 5% repurchase program, an additional 636,036 shares are available for repurchase. Cash dividends declared and paid during the first ~~six~~nine months of 2005 were ~~$4.8~~$7.1 million, a decrease from ~~$4.9~~$7.3 million from the same prior year period due to the reduction in common shares outstanding. On ~~July 20,~~October 19, 2005, the Board of Directors declared a quarterly cash dividend of twenty cents ($.20) per common share. The dividend is payable on ~~August 12,~~November 11, 2005 to stockholders of record at the close of business on ~~July 29,~~October 28, 2005.

The primary source of liquidity for OceanFirst Financial Corp., the holding company of OceanFirst Bank, is capital distributions from the banking subsidiary. For the first ~~six~~nine months of 2005, OceanFirst Financial Corp. received $11.1 million in dividend payments from OceanFirst Bank. The Company also received $5.0 million from the issuance of subordinated debt. The primary use of these funds is the payment of dividends to shareholders and the repurchase of common stock. OceanFirst Financial Corp.’s ability to continue these activities is partly dependent upon capital distributions from OceanFirst Bank. Applicable Federal law or the Bank’s regulator, may limit the amount of capital distributions OceanFirst Bank may make.

At ~~June~~September 30, 2005, the Bank exceeded all of its regulatory capital requirements with tangible capital of ~~$119.4~~$125.8 million, or ~~6.1%~~6.3% of total adjusted assets, which is above the required level of ~~$29.6~~$29.8 million or 1.5%; core capital of ~~$119.4~~$125.8 million or ~~6.1%~~6.3% of total adjusted assets, which is above the required level of ~~$59.2~~$59.6 million, or 3.0%; and risk-based capital of ~~$129.7~~$136.2 million, or ~~10.0%~~10.2% of risk-weighted assets, which is above the required level of ~~$103.8~~$106.4 million or 8.0%. The Bank is considered a “well-capitalized” institution under the Office of Thrift Supervision’s Prompt Corrective Action Regulations.

In the normal course of operations, the Company engages in a variety of financial transactions that, in accordance with generally accepted accounting principles, are not recorded in the financial statements. These transactions involve, to varying degrees, elements of credit, interest rate, and liquidity risk. Such transactions are used for general corporate purposes or for customer needs. Corporate purpose transactions are used to help manage credit, interest rate, and liquidity risk or to optimize capital. Customer transactions are used to manage customers’ requests for funding. These financial instruments and commitments include unused consumer lines of credit and commitments to extend credit. The Company also has outstanding commitments to sell loans amounting to ~~$97.3~~$96.8 million.

The following table shows the contractual obligations of the Company by expected payment period as of ~~June~~September 30, 2005 (in thousands):


Contractual Obligation	Total		Less than one year		1-3 years		3-5 years		More than 5 years		Total		Less than one year		1-3 years		3-5 years		More than 5 years
Debt Obligations	$	454,158	$	175,158	$	161,000	$	103,000	$	15,000	$	461,727	$	209,727	$	139,000	$	93,000	$	20,000
Commitments to Originate Loans		261,835		261,835		—		—		—		214,873		214,873		—		—		—
Commitments to Fund Unused Lines of Credit		160,092		160,092		—		—		—		167,621		167,621		—		—		—

Debt obligations include borrowings from the FHLB and Securities Sold under Agreements to Repurchase. The borrowings have defined terms and, under certain circumstances, ~~$102.0~~$82.0 million of the borrowings are callable at the option of the lender.

Commitments to originate loans and commitments to fund unused lines of credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments

generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company’s exposure to credit risk is represented by the contractual amount of the instruments.

The following table sets forth information regarding the Company’s non-performing assets consisting of non-accrual loans and Real Estate Owned (“REO”). It is the policy of the Company to cease accruing interest on loans 90 days or more past due or in the process of foreclosure.


	June 30, 2005			December 31, 2004			September 30, 2005			December 31, 2004
	(dollars in thousands)						(dollars in thousands)
Non-accrual loans:
Real estate:
One- to four-family	$	893		$	1,337		$	916		$	1,337
Commercial real estate, multi-family and land		—			744			—			744
Consumer		324			784			271			784
Commercial		835			623			237			623

Total non-performing loans		2,052			3,488			1,424			3,488
REO, net		288			288			278			288

Total non-performing assets	$	2,340		$	3,776		$	1,702		$	3,776

Allowance for loan losses as a percent of total loans receivable		.63	%		.69	%		.61	%		.69	%
Allowance for loan losses as percent of total non-performing loans		512.38			306.42			731.04			306.42
Non-performing loans as a percent of total loans receivable		.12			.23			.08			.23
Non-performing assets as a percent of total assets		.12			.20			.09			.20

The Company also classifies assets in accordance with certain regulatory guidelines. At ~~June~~September 30, 2005 the Bank had ~~$5.8~~$7.1 million classified as Special Mention, ~~$2.1~~$1.5 million classified as Substandard and ~~$405,000~~$134,000 classified as Doubtful as compared to $12.3 million, $5.1 million and $226,000, respectively, classified as Special Mention, Substandard and Doubtful at December 31, 2004.

In addition to historical information, this quarterly report contains certain forward-looking statements 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,” or similar expressions. 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 the subsidiaries include, but are not limited to, changes in interest rates, general economic conditions, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board, 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 should be considered in evaluating forward-looking statements and undue reliance should not be placed on 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. Further description of the risks and uncertainties to the business are included in Item 1, BUSINESS of the Company’s 2004 Form 10-K.

The Company’s interest rate sensitivity is monitored through the use of an interest rate risk (IRR) model. The following table sets forth the amounts of interest-earning assets and interest-bearing liabilities

outstanding at ~~June~~September 30, 2005, which were anticipated by the Company, based upon certain assumptions, to reprice or mature in each of the future time periods shown. At ~~June~~September 30, 2005 the Company’s one-year gap was positive ~~4.93%~~1.85% as compared to positive 5.14% at December 31, 2004.


At June 30, 2005 (dollars in thousands)	3 Months or Less			More than 3 Months to 1 Year			More than 1 Year to 3 Years			More than 3 Years to 5 Years			More than 5 Years			Total
At September 30, 2005																			3 Months or Less			More than 3 Months to 1 Year			More than 1 Year to 3 Years			More than 3 Years to 5 Years			More than 5 Years			Total
(dollars in thousands)
Interest-earning assets: (1)
Interest-earning deposits and short-term investments	$	8,728		$	—		$	—		$	—		$	—		$	8,728		$	2,610		$	—		$	—		$	—		$	—		$	2,610
Investment securities		77,562			2,803			—			—			6,529			86,894			76,513			2,586			—			—			6,534			85,633
FHLB stock		—			—			—			—			19,500			19,500			—			—			—			—			19,450			19,450
Mortgage-backed securities		8,492			23,443			33,048			40,361			568			105,912			7,422			23,404			27,303			34,930			508			93,567
Loans receivable (2)		281,135			289,925			550,011			330,597			200,397			1,652,065			290,013			284,274			542,478			334,619			239,183			1,690,567

Total interest-earning assets		375,917			316,171			583,059			370,958			226,994			1,873,099			376,558			310,264			569,781			369,549			265,675			1,891,827

Interest-bearing liabilities:
Money market deposit accounts		6,140			16,833			35,147			80,383			—			138,503			5,813			15,938			33,277			76,105			—			131,133
Savings accounts		11,628			31,880			66,564			152,234			—			262,306			11,364			31,158			65,055			148,785			—			256,362
Interest-bearing checking accounts		14,728			40,380			84,309			192,816			—			332,233			16,580			45,459			94,914			217,073			—			374,026
Time deposits		130,671			172,375			133,194			51,318			10,633			498,191			104,205			211,595			133,683			27,269			8,815			485,567
FHLB advances		36,000			71,000			119,000			80,000			15,000			321,000			47,000			95,000			103,000			70,000			15,000			330,000
Securities sold under agreements to repurchase		64,158			4,000			42,000			23,000			—			133,158			67,727			—			36,000			23,000			—			126,727
Subordinated debentures																				—			—			—			—			5,000			5,000

Total interest-bearing liabilities		263,325			336,468			480,214			579,751			25,633			1,685,391			252,689			399,150			465,929			562,232			28,815			1,708,815

Interest sensitivity gap (3)	$	112,592		$	(20,297	)	$	102,845		$	(208,793	)	$	201,361		$	187,708			123,869			(88,886	)		103,852			(192,683	)		236,860			183,012

Cumulative interest sensitivity gap	$	112,592		$	92,295		$	195,140		$	(13,653	)	$	187,708		$	187,708			123,869			34,983			138,835			(53,848	)		183,012			183,012

Cumulative interest sensitivity gap as a percent of total interest-earning assets		6.01	%		4.93	%		10.42	%		(0.73	)%		10.02	%		10.02	%		6.55	%		1.85	%		7.34	%		(2.85	)%		9.67	%		9.67	%

Additionally, the table below sets forth the Company’s exposure to interest rate risk as measured by the change in net portfolio value (“NPV”) and net interest income under varying rate shocks as of ~~June~~September 30, 2005 and December 31, 2004. All methods used to measure interest rate sensitivity involve the use of assumptions, which may tend to oversimplify the manner in which actual yields and costs respond to changes in market interest rates. The Company’s interest rate sensitivity should be reviewed in conjunction with the financial statements and notes thereto contained in the Company’s Annual Report for the year ended December 31, 2004.

The Company’s management, including the Company’s principal executive officer and principal financial officer, have evaluated the effectiveness of the Company’s “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended, (the ~~“Exchange~~

“Exchange Act”). Based upon their evaluation, the principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were effective for the purpose of ensuring that the information required to be disclosed in the reports that the Company files or submits under the Exchange Act with the SEC (1) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. In addition, based on that evaluation, no change in the Company’s internal control over financial reporting occurred during the quarter ended ~~June~~September 30, 2005 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company is not engaged in any legal proceedings of a material nature at the present time. From time to time, the Company is a party to routine legal proceedings within the normal course of business. Such routine legal proceedings in the aggregate are believed by management to be immaterial to the Company’s financial condition or results of operations.

Information regarding the Company’s common stock repurchases for the three month period ended ~~June~~September 30, 2005 is as follows:

On October 22, 2003 the Company announced its intention to repurchase up to 1,341,818 shares, or 10%, of its outstanding common stock. On October 19, 2005, the Company announced its intention to repurchase up to an additional 636,036 shares, or 5%, of its outstanding common stock upon completion of the existing program.

During the three months ended June 30, 2005, Messrs. Garbarino, Fitzpatrick, Pardes, Kelly and Iantosca, (“Named Executive Officers”) received stock option grants for 3,806, 1,464, 1,098, 751 and 615 shares, respectively and incentive bonuses of $39,572, $15,225, $11,419, $7,805 and $6,394, respectively. On April 21, 2005 each outside director received 473 common shares representing payment of the $10,000 annual retainer for service on the Company’s Board of Directors.Not Applicable

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


Delaware		22-3412577
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)		~~(I.R.S. Employer~~ ~~Identification No.)~~

975 Hooper Avenue, Toms River, NJ		08754-2009
(Address of principal executive offices)		(Zip Code)


		PAGE
PART I.	FINANCIAL INFORMATION

Item 1.	Consolidated Financial Statements (Unaudited)

	Consolidated Statements of Financial Condition as of ~~June~~September 30, 2005 and December 31, 2004	1

	Consolidated Statements of Income for the three and ~~six~~nine months ended ~~June~~September 30, 2005 and 2004	2

	Consolidated Statements of Changes in Stockholders’ Equity for the ~~six~~nine months ended ~~June~~September 30, 2005 and 2004	3

	Consolidated Statements of Cash Flows for the ~~six~~nine months ended ~~June~~September 30, 2005 and 2004	4

	Notes to Unaudited Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	8

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	15

Item 4.	Disclosure Controls and Procedures	16

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	1617

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	1617

Item 3.	Defaults Upon Senior Securities	1617

Item 4.	Submission of Matters to a Vote of Security Holders	1617

Item 5.	Other Information	17

Item 6.	Exhibits	1718

Signatures		1718


	June 30, 2005										December 31, 2004
	Net Portfolio Value						Net Interest Income				Net Portfolio Value						Net Interest Income
Change in Interest Rates in Basis Points (Rate Shock) (dollars in thousands)	Amount		% Change		NPV Ratio		Amount		% Change		Amount		% Change		NPV Ratio		Amount		% Change
200	$	200,902	(8.1	)%	10.6	%	$	62,297	1.2		$	185,995	(9.7	)%	10.1	%	$	59,967	1.9	%
100		214,880	(1.7	)	11.0			62,219	1.1			200,162	(2.8	)	10.6			59,661	1.4
Static		218,681	—		11.0			61,560	—			205,868	—		10.7			58,856	—
(100)		211,401	(3.3	)	10.5			60,000	(2.5	)		204,583	(0.6	)	10.5			57,699	(2.7	)
(200)		195,860	(10.4	)	9.7			57,064	(7.3	)		N/A	N/A		N/A			N/A	N/A


	September 30, 2005										December 31, 2004
	Net Portfolio Value						Net Interest Income				Net Portfolio Value						Net Interest Income
Change in Interest Rates in Basis Points (Rate Shock)	Amount		% Change		NPV Ratio		Amount		% Change		Amount		% Change		NPV Ratio		Amount		% Change
(dollars in thousands)
200	$	198,834	(10.8	)%	10.5	%	$	61,392	0.8	%	$	185,995	(9.7	)%	10.1	%	$	59,967	1.9	%
100		214,710	(3.6	)	11.1			61,424	0.9			200,162	(2.8	)	10.6			59,661	1.4
Static		222,798	—		11.2			60,886	—			205,868	—		10.7			58,856	—
(100)		219,168	(1.6	)	10.9			59,687	(2.0	)		204,583	(0.6	)	10.5			57,699	(2.7	)
(200)		204,549	(8.2	)	10.2			57,003	(6.4	)		N/A	N/A		N/A			N/A	N/A


Period	Total Number of Shares Purchased	Average price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
April 1, 2005 through April 30, 2005	6,000	$	23.07	6,000	441,942

May 1, 2005 through May 31, 2005	94,500	$	21.96	94,500	347,442

June 1, 2005 through June 30, 2005	101,400	$	21.93	101,400	246,042


	For the Three Months Ended June 30,
	2005						2004
	AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST		AVERAGE BALANCE		INTEREST		AVERAGE YIELD/ COST
	(Dollars in thousands)
Assets
Interest-earnings assets:
Interest-earning deposits and short term investments	$	13,234	$	98	2.96	%	$	10,781	$	28	1.04	%
Investment securities (1)		86,883		803	3.70			85,477		437	2.04
FHLB stock		19,802		235	4.75			23,659		81	1.37
Mortgage-backed securities (1)		112,397		967	3.44			147,860		1,194	3.23
Loans receivable, net (2)		1,590,601		22,757	5.72			1,450,303		20,405	5.63

Total interest-earning assets		1,822,917		24,860	5.45			1,718,080		22,145	5.16

Non-interest-earning assets		100,779						96,984

Total assets	$	1,923,696					$	1,815,064

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Transaction deposits	$	726,798		1,757	0.97		$	668,862		959	0.57
Time deposits		487,151		3,569	2.93			388,212		2,531	2.61

Total		1,213,949		5,326	1.75			1,057,074		3,490	1.32
Borrowed funds		443,728		4,605	4.15			500,461		5,147	4.11

Total interest-bearing liabilities		1,657,677		9,931	2.40			1,557,535		8,637	2.22

Non-interest-bearing deposits		120,869						111,841
Non-interest-bearing liabilities		10,585						9,940

Total liabilities		1,789,131						1,679,316
Stockholders’ equity		134,565						135,748

Total liabilities and stockholders’ equity	$	1,923,696					$	1,815,064

Net interest income			$	14,929					$	13,508

Net interest rate spread (3)					3.05	%					2.94	%

Net interest margin (4)					3.28	%					3.14	%


Period	Total Number of Shares Purchased	Average price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
July 1, 2005 through July 31, 2005	0	$	—	0	246,042

August 1, 2005 through August 31, 2005	26,042	$	23.41	26,042	220,000

September 1, 2005 through September 30, 2005	81,511	$	23.32	81,511	138,489


~~Exhibits:~~

3.1		Certificate of Incorporation of OceanFirst Financial Corp.*


~~10.18~~		~~Amendment and Form of OceanFirst Bank Employee Severance Compensation Plan.~~

31.1		Rule 13a-14(a)/15d-14(c) Certification of Chief Executive Officer


31.2		Rule 13a-14(a)/15d-14(c) Certification of Chief Financial Officer


		OceanFirst Financial Corp.
		Registrant

DATE: ~~August 9,~~November 7, 2005		/s/ John R. Garbarino
		John R. Garbarino
		Chairman of the Board, President
		and Chief Executive Officer

DATE: ~~August 9,~~November 7, 2005		/s/ Michael Fitzpatrick
		Michael Fitzpatrick
		Executive Vice President and
		Chief Financial Officer


Exhibit	Description	Page	Description	Page
10.18	Amendment and Form of OceanFirst Bank Employee Severance Compensation Plan	19

31.1	Rule 13a-14(a)/15d-14(c) Certification of Chief Executive Officer	29	Rule 13a-14(a)/15d-14(c) Certification of Chief Executive Officer	20

31.2	Rule 13a-14(a)/15d-14(c) Certification of Chief Financial Officer	30	Rule 13a-14(a)/15d-14(c) Certification of Chief Financial Officer	21

32.0	Section 1350 Certifications	31	Section 1350 Certifications	22


3.2		Bylaws of OceanFirst Financial Corp.**