Broadway Financial Corporation Announces Adoption of Shareholder Rights Plan.

Business Editors

LOS ANGELES--(BUSINESS WIRE)--Feb. 3, 2003

Broadway Financial Corporation ("Company") (Nasdaq:BYFC), the holding company of Broadway Federal Bank, f.s.b. ("Bank"), today announced Broadway Financial Corporation's Board of Directors adopted a Shareholder Rights Plan (the Rights Plan) on January 31, 2003. The Board's purpose in adopting the Rights Plan is to protect shareholder value in the event of an unsolicited offer to acquire the Company, particularly one that does not provide equitable treatment to all shareholders. Adoption of the Rights Plan is designed to encourage a potential acquirer of the Company to negotiate directly with the Board, and to provide the Board with greater leverage in such negotiations so as to provide the greatest value for the Company's shareholders. The Rights Plan will not interfere with any merger, acquisition or business combination that the Company's Board believes to be in the best interest of its shareholders.

Rights plans have become increasingly common. The Rights Plan is similar to rights plans that have been adopted by many public companies.

In connection with the adoption of the Rights Plan, the Board declared a dividend distribution of one Right for each outstanding common share held by shareholders of record on February 13, 2003. The rights will not become exercisable unless, with certain exceptions, an investor acquires 15 percent or more of the Company's common shares, or announces a tender offer that would result in the investor owning 15 percent or more of the common shares or makes certain regulatory filings seeking authority to acquire 15 percent or more of the common shares. If someone does acquire 15 percent or more of the Company's common shares, or acquires the Company in a merger or other transaction, each Right would entitle the holder, other than the investor triggering the Rights and related persons, to purchase the Company's common shares, or shares of an entity that acquires the Company, at half of the then current market price. The Rights Plan can be terminated or amended by the Board at any time.

The Bank is a community-oriented savings bank, which primarily originates residential mortgage loans in the Los Angeles geographic areas known as Mid-City and South Central. The Bank operates four full service branches, three in the city of Los Angeles, and one in the nearby city of Inglewood, California. Shareholders, analysts and others seeking information about the Company or the Bank are invited to write to: Broadway Financial Corporation, Investor Relations, 4800 Wilshire Blvd., Los Angeles, CA 90010, or visit our website at www.broadwayfed.com.