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First Internet Bank Announces Restructuring

Company Embarks on Accelerated Path to Profitability Despite Turbulent Capital Markets

Indianapolis, IN January 2, 2001 - First Internet Bank of Indiana this week announced restructuring initiatives brought about by gains in customer service productivity, a reduction in the Bank's commercial lending activities, and the reality of a weakening economy and turbulent capital markets. Bank executives stated the Bank is on track to achieve sustainable profitability in the year 2001 and this restructuring, which affects four full-time employees, is in keeping with that goal.

Launched in February 1999 as one of the first online banks with no brick-and-mortar presence, First IB offers an extensive product and online service offering that has garnered for the Bank $205 million in assets, customers around the country, and high marks from both Smart Money and the Internet Banker Scorecard published by Gomez, Inc. Bank officials closed $30 million in second-round funding in March and continue to seek additional sources of equity capital for growth.

"We are committed to achieving sustainable profitability and raising additional capital to resume our growth, and we must therefore address the slowing economy and uneven capital markets," said David Becker, Chairman and CEO. "With the acceptance of online banking, the fact that our checking accounts have tripled in the last six months, and other positive factors, we believe we have a strong business proposition that will be very attractive to the right investors."

Becker stated, "We do not adhere to a 'growth for growth's sake' principle. We endeavor to grow the Bank through the development of lasting, more profitable transactional client relationships, which we continue to attract with our superior product and service offering."

In December, the Bank announced a significant increase in the numbers of both accounts and customer transactions. Becker expressed confidence that the actions taken will have no negative impact on customer service.

First Internet Bank of Indiana is the first state-chartered, FDIC-insured institution to operate solely via the Internet. Services include no-fee interest-bearing checking accounts, regular and money market savings accounts with industry-leading interest rates, CDs, IRAs, credit cards, and check cards that can be used instead of cash or checks. First IB also offers personal lines of credit, installment loans, and unique real-time transfers between accounts.