20549-0408
October 1, 2004
Steven E. Brady
President
Ocean Shore Holding Company
1001 Asbury Avenue
Ocean City, New Jersey 08226
Re: Ocean Shore Holding Company
Form S-1, filed August 27, 2004
File Number 333-118597
Dear Mr. Brady:
We have reviewed your Form S-1 and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments. If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information we may have additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or on any other
aspect
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
Prospectus Cover Page
1. At the end of the minimum purchase paragraph you mention
"rescind
your order...." Please advise what authority you rely upon for
this
position.
2. Please confirm that the risk factor disclosure will be as
prominent and type size as large as the Sandler O`Neill
disclosure.
Summary - page 1
3. Please delete the third sentence of the legend at the top of
the
page. The terms you use need to be clear from context.
4. The text size you use seems too small. Please ensure that the
text in the final printing is easily readable.
OC Financial MHC - page 1
5. Please disclose here, at the outset, that the officers and
directors of OC Financial and the registrant will be the same
persons.
How We Determined the Offering Range- page 2
6. Please flip flop the "pro forma price to earnings and price to
book" table and associated narrative on page 4 with the "fully
converted pro forma p/e and p/b" table and associated narrative on
page 3.
7. The figures you use at the top of page 4, 9.3% and 10.4%, do
not
appear to be correct. Please reconcile these figures with the
table
on page 3.
After-Market Performance... - page 4
8. We note that RP Financial considered "some" recent offerings
(80+
day period March 4, 2004 thur June 30, 2004) in developing the
After-
Market Performance disclosure. We note that RP provided
significantly more disclosure in the very recent Home Federal
Bancorp, Inc., Form S-1, File No. 333-113731. Please revise
consistent with the Home Federal disclosure.
9. Please provide after market performance information so that
investors may easily compare "apples to apples." For example,
please
separate first step MHC deals from non-first step deals. In
addition, provide aggregate performance measures. Finally,
include
"to date" performance information.
10. Reasons for the Offering - page 6
11. Disclose, if correct, that another principal reason for the
current offering level is that OC Financial will retain control of
the registrant via its ownership level. Also disclose any other
principal reasons for the offering level.
Benefits of the Offering to Management- page 6
12. Please expand the stock awards disclosure to include a range
of
expense based upon After- Market Performance. We note similar
disclosure in several recent thrift
conversions including Clifton Savings, PSB Holdings, and the Home
Federal transaction referenced above.
12.1. Market Area - page 32
13. We note that this information is very positive, yet the some
of
the information in RP Financial report seems to indicate possible
future problems, if not current problems. We note, for example,
that
the median household income figures on page 2.3 show Cape May
county
below the US average in 2000 and falling. By 2008 both Cape May
County and Atlantic County are projected to be below the national
average. This decline and the reason for the decline appear to
warrant disclosure.
13.1. How We Determined the Offering Range... - page 99
14. The clarification you give, imbedded in the first sentence,
seems
to be either incorrect or difficult to follow. Please revise to
make
this text clear. Consider providing clarification in a separate
sentence.
Balance Sheet Analysis - Loans - pages 42
15. Please revise to present your loan portfolio maturity data and
disclosure of fixed and variable interest rate loans as of
December
31, 2003. Refer to Item IV(B) of Industry Guide 3 information.
16. Please revise to quantify the amount of loans terms modified
through your loan modification program for each period presented.
Analysis and Determination of the Allowance for Loan Losses - page
61
17. We note your disclosure that specific allowances are
established
for certain impaired or collateral-dependent loans and a general
valuation allowance is established for certain identified problem
loans. Please revise clarify the nature of the loans to which you
are referring to when you use the term "certain." Describe how
you
determine the loss factors you apply to your graded loans to
develop
the general valuation allowance.
18. Please revise to quantify the amount of specific allowance on
impaired or collateral-dependent loans, the general valuation
allowanced for identified problem loans, and the general valuation
allowance on the remainder of the loan portfolio for each period
presented.
Liquidity Management - page 66
19. We note your disclosure that at June 30, 2004 you held $109.4
million of available for sale securities that provide additional
sources of liquidity. Please revise to quantify the fair value of
available for sale securities with unrealized loss positions that
you
have the intent and ability to hold until you recover at least
your
investment. Quantify your estimate of the period of time until
this
recovery.
Consolidated Balance Sheets - page F-2
20. Please revise to separately disclose non-interest bearing
deposits and interest bearing deposits. Refer to Rule 9-03 of
Regulation S-X.
Consolidated Statements of Income - page F-3
21. Please revise to separately disclose taxable interest income
and
non-taxable interest income on investment securities and dividends
or
disclose this information in your financial statement footnotes.
Refer to Rule 9-04 of Regulation S-X.
Statement of Cash Flows - page F-5
22. Please revise to separately disclose purchases of mortgage
backed
securities available for sale and held to maturity. Refer to
paragraph 18 of FAS 115.
23. Please revise to separately disclose proceeds from the
maturities
of investment securities available for sale and held to maturity.
Refer to paragraph 18 of FAS 115.
Note 2 - Summary of Significant Accounting Policies - General -
page
F-7
24. Please revise to describe your loan modification program,
including whether you receive fees and how you account for the
loan
modifications and fees.
Note 2 - Summary of Significant Accounting Policies - Investment
and
Mortgage-Backed Securities - page F-8
25. Please revise to describe your policy for determining whether
unrealized losses on investments are other than temporary.
26. We note your disclosure of gross realized gains and gross
realized losses included in earnings resulting from sales of
investments for the year ended December 31, 2002.
Please revise to disclose the gross realized gains and losses for
the
year ended December 31, 2001. These disclosures should be
included
for each period for which results of operations are presented.
Refer
to paragraph 21 of FAS 115.
Note 2 - Summary of Significant Accounting Policies - Office
Properties
and Equipment- page F-8
27. Please revise to separately disclose the depreciable lives for
each class of property and equipment assets. Refer to paragraph 5
of
APB 12.
Note 2 - Summary of Significant Accounting Policies - Allowance
for
Loan Losses - page F-8
28. Please refer to paragraph .13 of SOP 01-6 and revise to
describe
the following accounting policies:
29. Determining past due or delinquency status;
30. Placing loans on non-accrual status;
31. Recording payments received on non-accrual loans;
32. Resuming accrual of interest; and
33. Charging off uncollectible loans.
34. Please revise to clearly describe your methodology for
determining each element of your allowance for loan losses.
Note 2 - Summary of Significant Accounting Policies - Loans Held
for
Sale and Loans Sold - page F-9
35. We note your disclosure that you have no loans classified as
held
for sale at June 30, 2004. This appears inconsistent with your
disclosure on page 33 that you have one loan classified as held
for
sale at June 30, 2004. Please revise for consistency.
Note 3- Investment Securities- page F-11 - F-13
36. Please revise to discuss the positive and negative information
that you considered in arriving at your conclusion that
investments
are not other-than-temporarily impaired. Provide all of the
disclosures required by paragraph 21(b) of EITF 03-01. Please
similarly revise your disclosures in Note 4.
Note 6 - Office Properties and Equipment - page F-19
37. Please revise to explain why you recorded a loss on the sale
of
office properties and equipment during the six months ended June
30,
2004, but do not disclose any proceeds from the sale of these
items
on your statements of cash flows.
Note 8 - Advances from Federal Home Loan Bank of New York - page
F-20
38. Please revise to quantify the carrying amount of assets
pledged
as collateral for your FHLB advances. Refer to Rule 4-08 of
Regulation S-X.
39. Please revise to quantify the amount of unused lines of credit
and FHLB borrowing capacity available for short-term financing.
Refer to Rule 9-03 of Regulation S-X.
Notes 12 - Commitments and Contingencies - page F-23
40. Please revise to describe and quantify the impact of adopting
FIN
45.
41. Please revise to describe the nature, terms, and notional
amounts
of your outstanding standby letters of credit and letters of
credit.
Refer to paragraph .14 of SOP 01-6.
Exhibit Index
42. For exhibit number 99.1, disclose the practical implications
of
Rule 202 for an ordinary investor and explain how they can obtain
this information.
Closing Comments
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
Direct any questions on accounting matters to Sharon Johnson
at
202-942-2961, or to Joyce Sweeney, Senior Accountant, at 202-942-
1939. Please direct any other questions to David Lyon at 202-942-
1796, or to me at 202-942-1779.
Sincerely,
Barry McCarty
Senior Counsel
By fax : Aaron M. Kaslow
Fax number 202-362-0840
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Ocean Shore Holding Company
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