Tom Crawford sees an opportunity for OceanFirst Financial Corp. to fill a void in Greater Baltimore. June 3, 2021

June 3, 2021

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Philadelphia Business Journal https://www.bizjournals.com/philadelphia/news/2021/06/03/how-oceanfirst-plans-to-grow-in-baltimore.html

Baltimore Business Journal https://www.bizjournals.com/baltimore/news/2021/06/03/how-oceanfirst-plans-to-grow-in-baltimore.html 

Tom Crawford sees an opportunity for OceanFirst Financial Corp. to fill avoid in Greater Baltimore brought on by the loss of regional banks due to consolidation over the last couple of decades.

Crawford, recently named mid-Atlantic market president for OceanFirst, is overseeing the Toms River, New Jersey-based bank's expansion into Baltimore. A veteran banker with more than 30 years of experience in the industry, Crawford has seen firsthand the impact of bank consolidation in Baltimore. He cut his teeth at Mercantile Bank shares and later worked for Provident Bank.

Both those banks, regional leaders based in Baltimore, ended up being acquired by financial giants: Mercantile by PNC in 2007 and Provident by M&T Bank in 2009 . In the end, Baltimore has been left with five big banks controlling more than 80% of the region's market share and a number of small community banks hyper-focused locally on serving small businesses. As a basis of comparison, Philadelphia's five largest banks control about two thirds of all local deposits.

Middle-market businesses, which OceanFirst (NASDAQ: OCFC) generally considers to be those with $5 million to $100 million in annual revenue, have fewer options to go to for lending and other services, like treasury management.

"You have the community banks and they are $1 billion or $2 billionin size...and they are very ingrained in the local community but they don't reach very far from a geography standpoint. And theystruggle to provide the full breadth of services that a middle-market company needs," Crawford said. "Then you've got the big national banks that have all products, services, bells and whistles, but they struggle to bring that sort of local feel to the service delivery."

That's where a bank like OceanFirst, which has $11.5 billion in assets, comes in to fill a need. OceanFirst is focused on serving the needs of those companies that aren't big, national publicly traded companies but also aren't small businesses, Crawford said.

OceanFirst is beginning its expansion by focusing specifically on commercial banking. Crawford and his team of seven bankers recently joined OceanFirst from BBVA Compass, which was acquired by PNC for $11.6 billion earlier this week.

Crawford and his team are moving quickly to act on OceanFirst's growth plans. They are seeking office space in downtown Baltimore with plans to add more bankers. While OceanFirst has not selected a specific location yet, Crawford said he and the other bankers need to "be in the middle of things" near accountants, lawyers and corporate headquarters.

"We're now down to a relative short list of properties," Crawfordsaid. "I think within the next several weeks to a month we'll have something definitive."

OceanFirst is looking for a "modest amount of space" withflexibility in the lease structure to grow into a bigger space.

"Out of the gate to do our business development activities and reconnect with a bunch of folks to relaunch the brand, we've got a core team to do that but we need some infrastructure," Crawford said. "I could easily see the number of people doubling in short order, before this lease term is up."

Based on how fast OceanFirst has been growing in other new markets, like Philadelphia and New York, Crawford said the bank will likely need enough space in Baltimore to "double again."

OceanFirst has completed six bank mergers since 2016. It has also consolidated retail branches while at the same time adding loan production offices in existing and adjacent markets.

While the bank is focused on commercial business growth in Baltimore, Crawford did not close the door to OceanFirst eventually serving retail customers and opening up branches.

"If the right acquisition were to come along and it's accretive to the overall game plan that OceanFirst has, I mean they've made seven acquisitions in the last six years and I think they will continue to do so," Crawford said. "It's not out of the question that they make an acquisition in this area and all of a sudden you've got a retail branch footprint."

De novo, or new branches, are also a possibility, he said. That is similar strategy as OceanFirst has in Philadelphia, where it inherited suburban loan production offices in Mount Laurel, Newtown Square and Doylestown from a series of bank acquisitions between 2016 and 2019 and then opened a loan office in Center City Philadelphia in 2019. It signed a lease in December to open its first retail branch in Pennsylvania at 1500 Market St. across from Philadelphia City Hall.

For Crawford, he sees OceanFirst's entry into Baltimore as an important step in helping the city to overcome its challenges. Crawford is a lifelong Baltimorean who graduated from Loch Raven High School. He chairs the University of Baltimore Foundation's board and also serves on the board of the Baltimore Office of Promotion and the Arts.

"I'm passionate about what's going on in Baltimore," Crawford said."While the city has a lot of challenges, well publicized some of the things that we're grappling with, I'm a big proponent of how were shape and relaunch the city of Baltimore and the region. A big part of that is bringing a bank like OceanFirst to the market."

OceanFirst is an "institution built on community," Crawford said.The bank supported relief efforts in New Jersey after Hurricane Sandy in 2012. Last year the bank did about $500 million in lending through the U.S. Small Business Administration's Paycheck Protection Program to help businesses impacted by Covid-19.

"They're just a very focused organization when there's trauma, something that needs to be tackled," Crawford said. "I feel like an organization like OceanFirst and that mindset of how to fix things and how to get involved will pay dividends for Baltimore."

"Baltimore is great city. I grew up here, I'll never it leave and I'm looking forward to changing the conversation to really start looking forward to what Baltimore can be or should be."

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