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MUTUAL SAVINGS BANK ANNOUNCES SECOND QUARTER EARNINGS; STRONG CORE EARNINGS; RECORD MORTGAGE VOLUME

 BAY CITY, Mich., July 14 /PRNewswire/ -- Mutual Savings Bank, f.s.b. (NASDAQ-NMS:MSBK) reported net income for the second quarter ended June 30, 1993 of $1.064 million, or $0.70 per share, compared to $650,232 earned a year earlier. Net income for the first half totaled $3.220 million, or $2.12 per share, compared to $1.245 reported in the first half last year. Mutual converted to public ownership July 16, 1992, so there are no comparable per share figures for 1992.
 Core operating earnings posted strong growth, based on record loan volume in the period. Mortgage originations totaled $180.1 million in the second quarter, an 86 percent increase over the year earlier period. Mortgage origination fees rose 66 percent to $1.350 million versus $813,124 reported in last year's second quarter. Servicing income and other fees continued to grow, rising 10 percent to $740,000 in the quarter.
 According to Wendell L. Evans, Jr., Chairman, "The Bank's strong performance is, in large part, the result of our highly successful "Quick Start" mortgage lending program. Over the past six months, we have equipped each of our loan originators with a laptop computer, enabling them to visit a mortgage applicant's home or their realtor's office, gather the necessary information, which is then electronically transmitted to a loan underwriting center, and produce a document for signature, all under an hour. Not only has Quick Start given us an edge in customer service, but it has enabled us to reduce substantially the cost of processing an application. We have gotten a very favorable reception to this program from loan customers and realtors.
 Loan demand has remained brisk. "We have, at the end of June, a backlog of $116 million in mortgage applications that were not yet closed," said Mr. Evans, "which is a reliable indicator of future loan growth."
 "While we are experiencing strong loan growth it has not come at the expense of increased risk to the Bank. Mutual's non-performing assets at the end of the second quarter amounted to 0.52 percent of total assets, down from 0.82 percent of total assets on June 30, 1992. The industry average for non-performing assets is 2.96 percent."
 Referring to deposit growth, Mr. Evans said, "The Bank launched a new savings program late in the quarter. Despite being offered only during June, we have experienced an increase in retail deposits. Although the gains are still modest at this point, it is significant for Mutual in that this marks a reversal of the slow decline in deposits we, as have many other banks, have been experiencing. I am pleased to note this deposit increase is the result of an improvement in our market share."
 Mutual's assets totaled $814.7 million at June 30, 1993 compared to $715.1 million at this time last year. Shareholder's equity equaled $41.7 million at the end of the first half, the equivalent of $28.75 per share, compared to $26.7 million a year ago. This increase reflects the Bank's initial sale of common stock last July and retained earnings since then. The Bank exceeds all regulatory capital requirements, as well as future guidelines as currently prescribed."
 Mutual Savings Bank serves central and southern Michigan with 25 full-service retail offices and five loan production offices. Mutual also has loan production offices in Dallas, Houston, Austin and Texarkana, Texas and Naples, Florida. Mutual is the sixth largest savings bank headquartered in Michigan.
 -0- 7/14/93
 /CONTACT: Wendell L. Evans, Jr., Chairman and Chief Executive Officer, or Bernard D. Williams, Senior Vice President-Chief Financial Officer-Treasurer, both of Mutual Savings Bank, 517-892-3511/
 /FIRST ADD -- TABLES -- TO FOLLOW/
 (MSBK)


CO: Mutual Savings Bank ST: Michigan IN: FIN SU: ERN

LG -- NY040 -- 1369 07/14/93 11:54 EDT
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Date:Jul 14, 1993
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