OceanFirst Financial Corp. in Toms River, N.J., announced Monday that it would restate earnings for the 12 months that ended Dec. 31.
The $2.1 billion-asset company said that a reserve for repurchased subprime loans made by its mortgage subsidiary should have been reflected in its 2006 financial statements but was not. OceanFirst said it is calculating the amounts reserved and restated.
The company's stock fell sharply on the news. It was trading at $19.72 per share late Monday, down 4.3%.
On Jan. 18, OceanFirst reported that its 2006 earnings fell 4%, to $18.7 million, and that earnings per share fell a penny, to $1.59.
Last year, the company's mortgage subsidiary, Columbia Home Loans, began to offer subprime mortgages, which it sold to investors.
The loan sale agreements required it to repurchase loans on which there was an early payment default, generally, the borrower's failure to make the first payment after the loan's funding. OceanFirst has stopped making these kinds of loans.
It earned $4.6 million in the fourth quarter, down nearly 5% from the same period a year earlier.
