IMX Exchange Raises Additional $22 Million in Investor Backing; Move Puts Mortgage Trading Arena on Track for $3-4B in Transaction Volume in 1999.

SAN RAMON, Calif.--(BUSINESS WIRE)--Feb. 3, 1999--IMX(R) Exchange, the premiere online marketplace for mortgage brokers and lenders, today announced that it has secured an additional $22 million in backing from a broad range of top investors, led by Lehman Brothers.

The move brings IMX's total financing to $40 million, and sets the stage for an aggressive national roll-out of the IMX Exchange system.

"IMX Exchange uses the enabling powers of the Internet to bring together mortgage lenders and brokers in a manner that is far more efficient and 'friction-free' than traditional means," said John Hummer, president and CEO, IMX Exchange. "And, the IMX system is secure, scalable, and dependable, with 100% uptime since launch."

The current round of financial backing was drawn from a wide range of investors, including top VC firms, investment and mortgage banks, and top-tier technology companies. The company's impressive financing is a strong testament to the success and rapid growth of IMX Exchange since its launch in October 1997.

In that period, working primarily in California, IMX has facilitated the trading of over $1 billion in mortgage assets, and has secured relationships with over 3,000 loan officers, representing more than 550 broker shops, as well as with over 50 lenders.

New investors in IMX Exchange include: Lehman Brothers, Citicorp, Inc., BancBoston Capital, Inc., and Presidio Venture Partners. Existing investors, all of whom are participating in this round include: Hummer Winblad Venture Partners; Mohr, Davidow Ventures; Technology Crossover Ventures; Piper Jaffray Ventures; and Intel Corporation.

"IMX Exchange is changing the way the mortgage industry does business," said Bill Carson of Citicorp's Technology Investment Group. "By leveraging the Internet to bring the entire market together in a real-time trading arena, the Exchange brings a new level of efficiency that will benefit all the players in the mortgage lending process -- from consumers up through the secondary market. We are pleased to be an investor in IMX and a future member of the Exchange."

"IMX is the only player in the online mortgage market that has taken full advantage of what the Internet allows," said Derek Proudian of Mohr, Davidow Ventures. "Like eBay in the consumer Internet arena, IMX recognized the true potential of fully connected computing in the business-to-business marketplace and has brought the efficiency of Exchange technology to one of the largest markets in the economy."

IMX Exchange has proven highly popular among lenders and brokers alike. For lenders, it has afforded the opportunity to increase market share and profitability, both in their existing markets and markets they had not been in before. "IMX Exchange has become a tremendous part of my region's production volume," says Allen Speck, first vice president of Wholesale Inside Sales at First Nationwide Mortgage Corp.

"It currently represents 50% of my business and I look forward to that number increasing appreciably as IMX continues to expand nationwide. Lenders who choose not to be come active on the IMX Exchange will discover that there are a number of loans that they will never see and have an opportunity to procure."

And for brokers -- who originate more than half of the loan volume in the over $1 trillion mortgage marketplace -- IMX offers a system that fosters efficiency, but still recognizes the importance of the mortgage professional.

"Unlike the majority of players in the online mortgage market who are looking to disintermediate the mortgage broker, the IMX Exchange model recognizes that there is real value to the knowledge that a mortgage professional brings to the process," said Gary Craft, VP of Research, BancBoston Robertson Stephens.

"Several parallel channels will likely survive in the online mortgage space, but the broker channel is not going to disappear. IMX Exchange allows the broker to harness the full power of the Internet to get the best options for their clients."

With its new financing, IMX will accelerate the ongoing roll-out of its service on a national basis. The company expects to be in states representing over 50 percent of the U.S. mortgage market by mid-year 1999 and anticipates continued strong growth thereafter, with an estimated $3 to 4 billion in transaction volume in 1999.

About IMX

IMX(R) Exchange is an online trading arena that uses the power of the Internet to bring together mortgage brokers and lenders in the most efficient manner possible. Using a nationwide, anonymous bid-ask system, lenders are able to bid directly on loans posted by originators the moment they appear on the primary market.

A transaction fee is paid to the IMX Exchange upon successful closing of the loan. IMX, Inc. was founded in 1995 and active trading began on the Exchange in October, 1997. Since that time, over $1 billion of mortgage assets have been traded via the IMX system.