---

T&W Expands Into Commercial Auto Rental Market

28 August 1998

T&W Expands Into Commercial Auto Rental Market

Joint Venture - Prime One Capital - to Focus on Financing Auto Rental Agencies
                             and Corporate Fleets

    TACOMA, Wash., Aug. 28 -- T&W Financial Corporation
announced today that it has expanded its specialty commercial
finance operations into the commercial auto rental and corporate fleet markets
by creating Prime One Capital Company, L.L.C. (Prime One).
    Prime One is a joint venture between T&W and Thomas Borzilleri, president
of Signature Automotive Group of Coral Springs, Florida, and Joseph David
Pacifico of Pacifico (Auto) Leasing in Philadelphia, Pennsylvania.  Initially,
T&W will own 60 percent of Prime One and Messrs. Borzilleri and Pacifico will
own 40 percent.  After Prime One meets certain equity minimums (5 million in
retained earnings), T&W will own 51 percent of the company and Messrs.
Borzilleri and Pacifico will own 49 percent.  The initial investment by T&W
will be $100,000.
    Prime One will be headquartered in Coral Springs, Florida.  Servicing,
collections operations, and underwriting will be conducted by T&W in Tacoma,
Washington.
    Mr. Michael Price, chairman and chief executive officer of T&W commented,
"The formation of Prime One opens another origination channel for T&W -- the
commercial auto rental and corporate fleet financing market.  Prime One is in
line with T&W's strategic objective of increasing originations through joint
ventures which target creditworthy markets and niches of national
significance."
    Mr. Tomas Price, president of T&W explained, "Prime One will be able to
negotiate volume discounts from manufacturers on pooled auto purchases and
offer more favorable terms to auto rental agencies and corporate fleet
operators than is generally available through banks.  We will provide
attractive funding options such as risk vehicle financing, repurchase
programs, and existing fleet portfolio refinancing to auto rental agencies and
corporate fleet rental operators.  Auto manufacturers and national auto rental
licensees are expected to be the source of most originations."
    Mr. Paul Luke, T&W senior vice president and director of finance stated,
"Most of these auto rental agencies and corporate fleet operators have been in
business for 10 years or more and meet T&W's underwriting criteria.  Also of
equal importance, residuals are guaranteed by the manufacturer or lessee,
which fits T&W's underwriting standards while minimizing residual risk.  A
significant portion of the business originated will be securitized.  We
believe that Prime One will be able to gain a substantial market share by
providing innovative financing solutions to the capital intensive businesses
of auto rentals and corporate fleets."
    Mr. Thomas Borzilleri, who has been appointed Prime One chief executive
officer said, "T&W gives us the financial strength as well as the servicing
and administrative skills needed to position the company as a leader in auto
rental agency and corporate fleet financing.  We will be able to bring T&W's
lower cost of capital and specialty commercial financing expertise to our
existing automotive manufacturer and auto rental agency and corporate fleet

contacts."  Messrs. Borzilleri and Pacifico each have 20 or more years of
experience in auto financing and leasing.
    "Prime One is now well positioned to rapidly capture market share in the
vast automotive market," added Mr. Joseph David Pacifico, who will serve as
president of Prime One.
    Based in Tacoma, Washington, and founded in 1976, T&W Financial
Corporation is a specialty commercial finance company.  It provides equipment
leasing, focusing primarily on the "small ticket" sector of the market, which
are leases less than $250,000.  Its customers are small- to medium-sized
independent businesses throughout the U.S. and Canada.

    This release contains forward-looking statements.  These statements are
subject to certain risks and uncertainties that could cause actual results to
differ materially from those anticipated in the forward-looking statements.
Readers should not place undue reliance on the forward-looking statements,
which reflect the management's view only as of the date hereof.  T&W
undertakes no obligations to publicly revise these forward-looking statements
to reflect subsequent events or circumstances.  Readers should also carefully
review the risk factors described in documents T&W files from time to time
with the Securities and Exchange Commission.