Ameriana Reports Third Quarter Results; Announces Plans for New Full Service Office.

NEW CASTLE, Ind.--(BUSINESS WIRE)--Oct. 30, 1998--Ameriana Bancorp (The Nasdaq Stock Market: ASBI) today reported results for the nine-month period and third quarter ended September 30, 1998.

For the first nine months of 1998, net interest income rose 2% to $9,220,000 compared with $9,021,000 a year ago, while the Company's provision for loan losses declined to $108,000 compared with $147,000 in the first nine months of 1997. Year-to-date 1998 net income was $2,876,000 or $.87 per diluted share compared with $2,760,000 or $.84 per diluted share in the year-earlier period.

Net interest income for the third quarter rose 5% to $3,127,000 compared with $2,987,000 in the year-earlier period, while the Company's provision for loan losses declined to $36,000 versus $60,000 in the same quarter last year. Ameriana's net income for the third quarter of 1998 was $933,000 or $.28 per diluted share versus $994,000 or $.30 per diluted share in the same period last year.

Net income for the third quarter of 1998 reflected amortization of goodwill totaling $61,000, largely related to the acquisition of three branches earlier this year, which did not affect the Company's prior-year results. Also, net income for the third quarter of 1997 included a one-time pre-tax gain of approximately $57,000 related to the sale of surplus land which was originally purchased as part of a larger parcel for the development of a new Ameriana location.

"Declining interest expense allowed Ameriana to post higher net interest income for the third quarter, with the rate of growth accelerating from the pace seen in the first half of the year," commented Harry J. Bailey, President and Chief Executive Officer. "The contribution of a branch acquisition earlier this year, coupled with the recent purchase of Cardinal State Bank in Ohio, can be seen in those results. This performance highlights the expanding geographic diversity of our banking operations. The immediate costs associated with the Company's recently added offices, such as amortization expense as well as personnel and occupancy costs, were somewhat offset by this growing network. In the long term, we believe our expansion will produce more positive results for Ameriana and its shareholders."

Bailey also announced that Ameriana will construct a full service banking facility in New Palestine, Indiana. This new suburban Indianapolis branch, which is expected to open in the second half of 1999, will extend the Bank's residential mortgage lending and its consumer and commercial banking services to the southwest of Ameriana's current marketing region, providing the Bank with a greater presence to customers in Shelby, Marion and Hancock counties. This follows Ameriana's earlier expansion into Hendricks county to the west of Indianapolis in 1997. "We are pleased to announce this addition to Ameriana's banking franchise," Bailey continued. "The New Palestine office will be Ameriana's ninth location in the Indiana market and continues the Company's planned growth in developing communities."

Ameriana's total assets rose to $398,667,000 at September 30, 1998, from $390,868,000 at December 31, 1997. Loans and mortgage-backed securities at the end of the third quarter totaled $303,526,000 versus $324,386,000 as of the prior year-end, and total deposits rose to $331,228,000 from $322,217,000 at December 31, 1997. Shareholders' equity  at quarter's end increased to $45,239,000 compared with $44,435,000 at the end of 1997, representing 11.3% of total assets at September 30, 1998, versus 11.4% at December 31, 1997.

Ameriana Bancorp, through its wholly owned subsidiaries, Ameriana Bank of Indiana and Ameriana Bank of Ohio, offers an extensive line of banking services through branches in central Indiana and in the greater Cincinnati, Ohio area. Ameriana Bancorp also offers title insurance through Indiana Title Insurance Company. In addition to its banking services, Ameriana Bank of Indiana, through a financial services subsidiary, has an interest in a life insurance company and owns Ameriana Insurance Agency - a full-service insurance agency. Also, Ameriana Bank of Indiana and Ameriana Bank of Ohio provide a full line of investments and securities products in their brokerage centers. -0-

                           AMERIANA BANCORP
                    Unaudited Financial Highlights
               (In thousands, except per share amounts)

                               Three Months Ended    Nine Months Ended
                                    Sept. 30             Sept. 30
                               -----------------    ------------------
                                1998      1997       1998       1997
                               -------   -------    -------    -------
Interest income                $ 7,203   $ 7,330    $21,206    $22,039
Interest expense                 4,076     4,343     11,986     13,018
                               -------   -------    -------    -------
Net interest income              3,127     2,987      9,220      9,021
Provision for loan losses           36        60        108        147
                               -------   -------    -------    -------
Net interest income after
  provision for loan losses      3,091     2,927      9,112      8,874
Other income                       804       753      2,453      2,001
Other expense                    2,433     2,175      7,083      6,596
                               -------   -------    -------    -------
Income before income taxes       1,462     1,505      4,482      4,279
Income taxes                       529       511      1,606      1,519
                               -------   -------    -------    -------
Net income                     $   933    $  994    $ 2,876    $ 2,760
                               =======   =======    =======    =======

Earnings per share:
  Basic                        $  0.28    $ 0.31    $  0.88    $  0.85
                               =======   =======    =======    =======
  Diluted                      $  0.28    $ 0.30    $  0.87    $  0.84
                               =======   =======    =======    =======

Weighted average shares:
  Basic                          3,263     3,231      3,253      3,251
                               =======   =======    =======    =======
  Diluted                        3,301     3,282      3,300      3,279
                               =======   =======    =======    =======

Dividends declared
  per share                    $  0.16   $  0.16    $  0.48    $  0.46
                               =======   =======    =======    =======


                                   Sept. 30    Dec. 31
                                     1998       1997
                                  --------   --------
Total assets                      $398,667   $390,868
Cash and other investments          80,648     54,016
Loans and mortgage-backed
  securities, net                  303,526    324,386
Deposits                           331,228    322,217
Shareholders' equity                45,239     44,435
Book value per share                 14.11      13.74