Banking and Finance Law Daily Wrap Up, BANK HOLDING COMPANIES—NCRC weighs in against OceanFirst, Flushing merger, (Mar 10, 2026)

By Suzanne Cosgrove

The group urges the Board of Governors to condition the approval of the merger application on the adoption of a “robust” CBA.

The National Community Reinvestment Coalition (NCRC) has submitted a comment letter dated March 2 to the Board of Governors of the Federal Reserve voicing the group’s opposition to a proposed merger of OceanFirst Financial Corp., based in Toms River, N.J., and Flushing Financial Corp., in Uniondale, N.Y.

OceanFirst Financial Corp., the holding company for OceanFirst Bank N.A., and Flushing Financial Corp., the holding company for Flushing Bank, announced a definitive merger agreement between the two banking companies at the end of 2025. Upon completion of the merger, Flushing Bank will merge into OceanFirst Bank, with OceanFirst Bank surviving the bank merger.

Based on OceanFirst’s closing stock price on Dec. 26, 2025, of $19.76, the transaction is valued at $579 million and is expected to create a regional bank with a significant presence across the New Jersey, Long Island, and New York markets.

Warning signs. As a result of the transaction’s projected scale and its potential impact on competition, fair access to credit, and the availability of banking services for low- and moderate-income communities, NCRC urged the Board of Governors to condition approval of this application on the adoption of a robust Community Benefits Agreement (CBA).

The NCRC outlined a handful of its concerns about the bank’s performance, noting that from 2018 through 2020, OceanFirst received a “Needs to Improve” Community Reinvestment Act (CRA) rating.

“That rating alone warrants heightened scrutiny of any expansionary merger,” the group contended. “A bank with a recent ‘Needs to Improve’ rating should not be permitted to grow its footprint in major metropolitan markets without clear, enforceable commitments to address past deficiencies.”

Further, the group cited mortgage lending data showing that OceanFirst trails peers by more than 10 percentage points in mortgage lending in three out of its six assessment areas. “These gaps indicate ongoing and meaningful disparities in access to home purchase and refinance credit, particularly concerning in high-cost housing markets such as New York and New Jersey,” the group stated.

Redlining violations. In its letter, the NCRC noted that on Oct. 1, 2024, the U.S. District Court for the District of New Jersey entered a consent order in United States v. OceanFirst Bank, resolving allegations that OceanFirst violated the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA) by redlining majority-Black, Hispanic, and Asian neighborhoods in Middlesex, Monmouth, and Ocean Counties, New Jersey.

The Department of Justice had alleged that OceanFirst systematically excluded communities of color from equal access to credit by focusing outreach disproportionately in majority-white communities. The consent was among the most recent fair lending enforcement actions against a bank currently seeking federal merger approval, the NCRC said.

Recommendations. The NCRC recommended the Federal Reserve require the banks to adopt a CBA that includes the following guarantees:

• Increased lending to LMI borrowers and neighborhoods, with measurable benchmarks for home purchase, home improvement and refinancing loans;

• A commitment to open at least five branches within five years of the merger closing date, in LMI or MM census tracts;

• Expanded access to small business lending, including micro-loans;

• Community development investments with significant commitments to support affordable housing, CDFIs and nonprofit partners; and

• Regular public reporting on progress toward CBA goals, with ongoing input from community stakeholders.

Companies: OceanFirst Financial Corp.; OceanFirst Bank N.A.; Flushing Financial Corp.; Flushing Bank

RegulatoryActivity: BankHolding BankingOperations CommunityDevelopment FederalReserveSystem FinancialStability Mortgages NewJerseyNews