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Telebank Launches Online Auto Loan Center Through Partnership

29 November 1999

Telebank Launches Online Auto Loan Center Through Partnership With PeopleFirst.com; Largest Internet Bank Offers Latest Benefit to Growing Customer Base

    ARLINGTON, Va.--Nov. 29, 1999--Telebank (http://www.telebank.com), the nation's leading and largest pure-play Internet bank providing FDIC-insured products and value-added financial services via the Internet, is launching its online Auto Loan Center through a strategic partnership agreement with PeopleFirst.com, an innovative leader and provider of auto loans nationwide.
    Through this strategic partnership, Telebank continues to expand its offerings of value-added products and services, providing instant access to PeopleFirst.com's complete range of new, used and person-to-person auto loans through a co-branded link between the partners' Web sites.
    Auto loans are the latest in Telebank's growing selection of Internet-enabled offerings, which now include a virtual insurance agency and an online brokerage center, as well as a complete selection of FDIC-insured savings products, Internet banking services, and Telebank's award winning True.net(TM) Checking account.
    "This strategic partnership with PeopleFirst.com gives a boost to our customer-first focus -- providing more of the value-added products that our customers want with anytime/anywhere convenience and responsive customer service through multiple channels," said Mitchell H. Caplan, president and chief executive officer of Telebank.
    "With over $2 billion in customer deposits and more than 100,000 customer accounts, Telebank has locked up the leadership position and continues to pull away from the competition."
    "We're very pleased that a market leader like Telebank has chosen PeopleFirst.com to power its Auto Loan Center," said Gary J. Miller, CEO and co-founder of PeopleFirst.com. "Our innovative 'blank check' product offerings, seamless Internet technology, and unmatched customer service are all a good match for Telebank's online customers."
    With a 10-year track record of successfully and securely serving a nationwide customer base, Telebank is poised to become the online bank of choice for a growing number of consumers who are demanding the convenience of the Internet. Telebank's growth reflects a recent consumer trend in financial services.
    Online banking continues to penetrate an increasing number of U.S. households, while branch-based transactions continue to decline.
    A recent report by Piper Jaffray Inc. predicts that the number of households banking online will more than quintuple from 4.4 million households in 1998 to more than 25 million households by 2003, a compounded annual growth rate of more than 42 percent over the next five years.

    About Telebank

    Telebank is the nation's leading and largest pure-play Internet bank and the first pure-play Internet bank in the United States to surpass the industry milestone of $2 billion in customer deposits. Telebank is the only pure-play Internet bank to be ranked among the top 40 federally chartered U.S. savings banks, based on both assets and deposits.
    Setting the pace as a leader in the banking industry, Telebank created a branchless banking model in 1989, replacing brick-and-mortar branches with service through electronic delivery channels, including the Internet, telephone, facsimile and ATM, to reduce operating costs and pass the savings back to consumers as premium rates consistently in the top 1 percent nationally.
    Pending shareholder and regulatory approval, Telebank is positioned to become part of the first pure-play e-commerce company in the financial services sector -- combining banking and brokerage services -- through a definitive merger agreement with E*TRADE, a global leader in online investing.
    Telebank is a wholly owned subsidiary of Telebanc Financial Corp. , providing high value financial products and services to customers in all 50 states through low-cost electronic delivery platforms, focusing increasingly on the Internet.
    Telebank has been ranked No. 1 by bankrate.com in its 1999 nationwide annual checking survey and has been selected one of the top 50 fastest-growing Internet companies by Worth magazine.
    At Sept. 30, 1999, Telebank had nearly $4.0 billion in assets, more than $2.0 billion in deposits and 100,000 customer accounts. Telebank can be accessed at www.telebank.com or 800/TELEBANK.

    About PeopleFirst

    PeopleFirst.com is a privately held company located in San Diego. Founded in 1995, the company spent more than 18 months internally building its customized Internet lending delivery systems and has been offering auto loans via the Internet since August 1997.
    The company was named one of the five "Best of the Web" financial innovators in 1998 by Online Banking Report, which cited PeopleFirst.com as the "pioneer of blank check auto lending." The company presently offers auto loans in 43 states plus the District of Columbia, with plans to expand to all 50 states as soon as possible.

    Note to Editors: In the company name E*TRADE noted in this news release, there is an asterisk between E and TRADE. This symbol may not appear properly in some systems.