Fitch Downgrades Ratings for Bay View Capital Corp. and Subsidiaries.

Business Editors

CHICAGO--(BUSINESS WIRE)--Oct. 3, 2000

Fitch has downgraded the ratings for Bay View Capital Corporation (BVC) and subsidiaries and placed the ratings on Rating Watch Negative. The long-term rating for BVC was lowered to `B-' from `B', while the long-term rating for Bay View Bank N.A. (BVB) was lowered to `B-' from `B+'. The ratings impacted by this action are outlined at the end of this release.

BVC announced Friday, Sept. 29, 2000, that it has entered into a `Letter Agreement' with the Board of Governors of the Federal Reserve System. The agreement requires the company to seek regulatory approval before paying any common stock dividends or dividends on its capital securities. Further, according to the company, it has not received regulatory approval to pay the Sept. 30, 2000, dividend on its capital securities. As a result, the company will defer payment on the capital securities as outlined in the original prospectus. Dividends can be deferred for a period not to exceed 20 consecutive quarters or beyond the final maturity of the securities. Dividends will accrue during the deferral period and must be paid in full prior to any future payments of common dividends.

Fitch is concerned that the recent regulatory action is a result of BVC's inability to establish an appropriate capital plan and profit forecast. Management has not submitted a capital plan to the regulators or Fitch to date, making it difficult to assess overall capital adequacy and support for outstanding obligations. The company plans to accrue for dividend payments and to seek regulatory approval to pay these dividends again in the fourth quarter of 2000. Fitch plans to leave the ratings on Rating Watch Negative until some of these near-term concerns can be resolved and a better indication of long-range profitability can be determined.

Fitch is an international rating agency that provides global capital market investors with the highest quality ratings and research. Dual headquartered in New York and London with a major office in Chicago, Fitch rates entities in 75 countries and has some 1,100 employees in over 40 local offices worldwide. The agency, which is a combination of Fitch IBCA and Duff & Phelps Credit Rating Co., provides ratings for Financial Institutions, Banks, Corporations, Structured Finance, Insurance, Sovereigns and Public Finance Markets worldwide.

Old Ratings                       Rating Watch
Bay View Capital Corporation:
--Senior Implied   `B'            Evolving
--Subordinated debt   `B-'        Evolving
--Individual Rating   `C'
--Support Rating   `5'

Bay View Capital Trust I:
--Trust Preferred   `B-'          Evolving

Bay View Bank, N.A.:
--Deposit obligations   `BB'      Evolving
--Nondeposit obligations   `B+'   Evolving
--Subordinated debt   `B'         Evolving
--Short-term obligations   `B'    Evolving
--Individual Rating   `C'
--Support Rating   `5'

New Ratings                       Rating Watch
Bay View Capital Corporation:
--Senior Implied   `B-'           Negative
--Subordinated debt   `CCC'       Negative
--Individual Rating   `D'
--Support Rating   `5'

Bay View Capital Trust I:
--Trust Preferred   `CC'          Negative

Bay View Bank, N.A.:
--Deposit obligations   `B+'      Negative
--Nondeposit obligations   `B-'   Negative
--Subordinated debt   `CCC'       Negative
--Short-term obligations   `C'    Negative
--Individual Rating   `D'
--Support Rating '5'