GAC Announces Executive Management Additions, Exit From Company-Owned Dealership Business, Third Quarter Results.

BLOOMINGTON, Ind.--(BUSINESS WIRE)--Nov. 11, 1997--

Executive Management Additions ______________________________

General Acceptance Corp. (NASDAQ:GACC) today announced a series of additions and changes in executive management designed to enhance the company's executive management team as the first of several steps to better position the company for profitable growth.

James J. Larkin, a member of the company's board of directors since April 1997, has been named to the posts of chairman of the board of directors and chief executive officer, succeeding Malvin L. Algood. Larkin is a senior vice president of Conseco Services LLC, where he will retain certain limited responsibilities, and previously was a partner with Ernst & Young LLP. Algood, a significant stockholder, will remain with the company as an advisor to executive management.

James J. Terrell has been named chief operating officer, succeeding Russell E. Algood, who will retain has post as president. In their respective roles, Terrell will devote his full time efforts to directing the company's daily operations and Russell E. Algood will focus on strategic initiatives and industry issues. Terrell is a senior vice president of Conseco Services LLC and has extensive senior management, marketing and operating experience in banking and consumer finance, most recently as a senior vice president of Barnett Banks.

The company welcomes Larkin and Terrell as the next step in the evolution of Conseco's growing financial and operational involvement with the company. Conseco is a Fortune 500 financial services company based in Carmel, Ind., which, through its subordinated debt investment and warrant position in the company, subject to shareholder approval, has the right to acquire approximately 53 percent of the total outstanding common stock of the company.

Exit From Company-Owned Dealership Business ___________________________________________

To allow management to focus its efforts on its core auto finance operations, the company also announced its decision to exit from the business of operating company-owned dealerships. The unsatisfactory results of the company's dealerships, which have been operated under the name Drive Home USA, contributed to this decision. All of the company-owned dealerships will be closed with the exception of four locations in Indiana which will be sold to a company to be formed by Russell E. Algood and B. Wayne Garland, vice president responsible for company-owned dealership operations. Upon the closing of this transaction, scheduled for January 1998, Garland will resign his position with the company to devote his efforts to the development of the independent dealership company. Russell E. Algood will devote his full time efforts to the company and will not be active in the day-to-day operations of the independent dealership company. The sale was approved by the independent members of the company's board of directors. As part of this pending sale, restrictions on the sale of the company stock in the open market by members of the Algood family have been relaxed.

In connection with the discontinuation of this segment of the company's business, a charge of $2.6 million was recorded in the third quarter of 1997. This charge consists of $1.9 million in estimated losses on the closing and sale of the company-owned dealerships, and $700,000 in estimated operating losses during the phase-out period. Management believes that this move, while painful in the short run, will significantly strengthen the company and allow it to focus on its core business of non-prime auto finance.

Third Quarter Results _____________________

The company today also reported results for the third quarter and nine months ended Sept. 30, 1997. The loss from continuing operations for the third quarter of 1997 was $(630,000) compared to a loss of $(1.4 million) for the third quarter of 1996. The loss from continuing operations for the third quarter of 1997 includes a $776,000 non-cash guarantee fee, which is discussed further below. Without the guarantee fee, income from continuing operations for the third quarter of 1997 would have been $146,000. Beginning in the third quarter of 1997, the company classified the company-owned dealerships as discontinued operations. The loss from operations of the discontinued company-owned dealership business was $(1.6 million) for the third quarter of 1997 compared to a loss of $(934,000) for the third quarter of 1996. In addition, a charge of $2.6 million was recorded in the third quarter of 1997 related to losses expected to be incurred from the closure and sale of the company-owned dealerships, which included $700,000 in projected operating losses during the phase-out period. On a per share basis, the loss from continuing operations for third quarter of 1997 was $(0.10) compared to $(0.24) for the comparable period of 1996, and the net loss for the third quarter of 1997 was $(0.80) compared to $(0.39) for the comparable period of 1996.

The loss from continuing operations for the first nine months of 1997 was $(4.3 million) compared to income of $328,000 for the first nine months of 1996. The loss from continuing operations for the first nine months of 1997 includes a $776,000 non-cash guarantee fee, which is discussed further below. Without the guarantee fee, the loss from continuing operations for the first nine months of 1997 would have been $(3.5 million). The loss from operations of the discontinued company-owned dealership business was $(6.3 million) for the first nine months of 1997 compared to $(2.0 million) for the comparable period of 1996. In addition, a charge of $2.6 million was recorded in the first nine months of 1997 related to losses expected to be incurred from the closure and sale of the company-owned dealerships, which included $700,000 in projected operating losses during the phase-out period. On a per share basis, the loss from continuing operations for the first nine months of 1997 was $(0.71) compared to income from continuing operations of $0.05 for the comparable period of 1996, and the net loss for the first nine months of 1997 was $(2.18) compared to $(0.27) for the comparable period of 1996.

Total finance revenues for the third quarter of 1997 were $3.9 million compared to $7.7 million for the third quarter of 1996, a decrease of 49.7 percent. For the first nine months of 1997, total finance revenues were $13.6 million compared to $22.6 million for the comparable period of 1996, a decrease of 39.7 percent. The decrease for both periods was due primarily to a 38.8 percent reduction in total contracts receivable as of the end of the third quarter of 1997 as compared to the end of the third quarter of 1996. This reduction in contracts receivable resulted from the sale of $45.0 million of contracts in accordance with the company's previously announced closure of finance operations in certain geographic markets and the resulting lower origination volume in the first nine months of 1997.

Results for the third quarter of 1997 included a provision for credit losses of $200,000 compared to $4.7 million for the third quarter of 1996. The provision for credit losses was $5.9 million for both the first nine months of 1997 and 1996. The $200,000 provision for credit losses recorded in the third quarter of 1997 restored the allowance and discount available for credit losses to a level deemed adequate to cover expected future credit losses.

As of Sept. 30, 1997, the company's total reserves available for credit losses were $8.7 million, which represented 11.3 percent of total contracts receivable. The comparable total reserves available for credit losses as a percent of contracts receivable as of June 30, 1997 and Dec. 31, 1996 were 11.6 percent and 10.6 percent, respectively. The company's contractual 60-day delinquency rate was 2.7 percent as of Sept. 30, 1997 as compared to 1.5 percent as of June 30, 1997, and 1.8 percent as of Dec. 31, 1996. The company attributes the increase in delinquency rates during the third quarter of 1997 to general conditions in the sub-prime auto finance industry and to the transitional effects of the installation in September 1997 of a predictive dialing system which is expected to ultimately enhance the company's collection capabilities.

The previously announced sale of $13.25 million in convertible subordinated notes and the issuance of 500,000 warrants, subject to shareholder approval, had conversion and exercise prices which were below the market value of the company's stock on the date of issuance. These securities were issued and the conversion price was adjusted to compensate Conseco for its guarantee of a portion of the company's indebtedness to its primary lender. Accordingly, as prescribed by generally accepted accounting principles, the company recorded in the third quarter of 1997 a $24.1 million prepaid guarantee fee, with an offsetting increase to additional paid-in capital. This amount represents the number of shares issuable at a conversion or exercise price of $1.00 per share times the per share discount from market value of the company's common stock. The amortization of the prepaid guarantee fee will result in a non-cash charge to operations over the term of the guarantee, which runs from Sept. 16, 1997 to Jan. 1, 1999. For the third quarter and first nine months of 1997, the amount of this non-cash charge was $776,000.

As a result of the losses incurred by the company-owned dealership business in the third quarter of 1997, the company failed to comply with an interest coverage covenant contained in its agreement with its primary lender. The company is in discussions with the lender to resolve this issue.

This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements about enhancing the company's collections capabilities and the level of expected future credit losses. These statements, and any other forward-looking statements contained herein, are subject to risks, including risks outside the company's control, that could cause results to vary materially from the statements set forth herein. Some of these risks include, but are not limited to, general economic conditions, the level of competition from other sub-prime auto finance providers and the company's ability to maintain its underwriting policies and guidelines.

General Acceptance Corp. is a specialized consumer finance company principally engaged in purchasing and servicing installment sale contracts relating to the sale of used automobiles to consumers with limited access to traditional financing sources. The company acquires these contracts from unaffiliated dealers as well as from, through January 1998, used vehicle dealerships operated by the company. The company is headquartered in Bloomington, Ind. and has regional offices in Indiana, Ohio and Florida.

The company's stock is traded on NASDAQ under the symbol "GACC." -0-

                      General Acceptance Corp.
              (In thousands, except per share amounts)

                 Condensed Statements of Operations

                             Three Months Ended    Nine Months Ended
                                  Sept. 30,           Sept. 30,
                               1997       1996     1997       1996
                               ____       ____     ____       ____
Finance revenues:
 Interest and discount      $  3,731  $  7,022   $ 13,026  $ 20,511
 Ancillary products               64       619        162     1,781
 Other                            55        11        445       316
                            ________  ________   ________  ________
Total finance revenues         3,850     7,652     13,633    22,608
Expenses:
 Interest                      1,726     2,185      5,375     6,661
 Provision for credit losses     200     4,700      5,884     5,925
 Guarantee fee                   776       ---        776       ---
 Operating expenses            1,778     3,140      5,869     9,475
                            ________  ________   ________  ________
Total expenses                 4,480    10,025     17,904    22,061
                            ________  ________   ________  ________
Income (loss) from
 continuing operations
 before taxes                   (630)   (2,373)    (4,271)      547
Provision for income tax         ---      (949)       ---       219
                            ________  ________   ________  ________
Income (loss) from
 continuing operations          (630)   (1,424)    (4,271)      328
                            ________  ________   ________  ________
Discontinued operations:
 Loss from operations         (1,579)     (934)    (6,283)   (1,979)
 Loss on abandonment and
  sale                        (2,600)      ---     (2,600)      ---
                            ________  ________   ________  ________
                              (4,179)     (934)    (8,883)   (1,979)
                            ________  ________   ________  ________
Net loss                    $ (4,809) $ (2,358)  $(13,154) $ (1,651)
                            ________  ________   ________  ________
                            ________  ________   ________  ________
Income (loss) from
 continuing operations
 per share                  $  (0.10) $  (0.24)  $  (0.71) $   0.05
                            ________  ________   ________  ________
                            ________  ________   ________  ________
Net loss per share          $  (0.80) $  (0.39)  $  (2.18) $  (0.27)
                            ________  ________   ________  ________
                            ________  ________   ________  ________
Weighted average shares
 outstanding                   6,023     6,022      6,025     6,022
                            ________  ________   ________  ________
                            ________  ________   ________  ________


                      General Acceptance Corp.
             (In thousands, except per share amounts)

                     Condensed Balance Sheets

                                            Sept. 30,     Dec. 31,
                                              1997          1996
                                           __________    __________
Contracts receivable:
 Held for investment                       $ 76,563      $ 62,263
 Held for sale                                 ---         54,868
                                           __________    __________
                                             76,563       117,131
Allowance and discount available for
 credit losses                               (7,485)      (10,611)
                                           __________    __________
Contracts receivable, net                    69,078       106,520
Repossession inventory                          939         7,534
Purchased and trade inventory                 5,905         2,518
Prepaid guarantee fee                        23,286         ---
Other assets                                  7,323         7,074
                                           __________    __________
Total assets                               $106,531      $123,646
                                           __________    __________
                                           __________    __________

Revolving line of credit                   $ 55,202      $ 93,977
Bank line of credit                           ---           4,500
Subordinated notes                           14,750         1,000
Accounts payable and accrued expenses         4,230         4,651
Accrual for discontinued operations           2,600         ---
Dealer participation reserves available
 for credit losses                            1,177         1,855
Stockholders' equity                         28,572        17,663
                                           __________    __________
Total liabilities and stockholders'
 equity                                    $106,531      $123,646
                                           __________    __________
                                           __________    __________

CONTACT: General Acceptance Corp.

Martin C. Bozarth, 812/337-6023