E*TRADE Announces Launch of E*TRADE Mortgage

One of Financial Services’ Most Widely Known Brand Names Now Includes Online Mortgage Origination – Delivering Customer Value and Profitability Through Diversified Model

MENLO PARK, Calif., June 18 /CNW/ — E*TRADE Group, Inc.
(NYSE: ET news) today announced the launch of E*TRADE Mortgage, a major integration milestone following its February 1, 2001 acquisition of LoansDirect, one of the nation’s largest online mortgage originators with year-to-date volumes of more than $1.6 billion. E*TRADE Mortgage is the latest advance in E*TRADE’s ongoing diversification strategy to integrate online mortgage origination with Internet brokerage, value-added banking and other wealth management products and services.

By re-branding its aggressively growing mortgage origination platform with one of the most widely-known brand names in financial services today, E*TRADE furthers its goals to penetrate customer households, expand cross-sell opportunities and capture an even greater share of the customer wallet. In addition, the launch of E*TRADE Mortgage is a strong financial move for the Company, delivering revenue diversification through additional channels such as origination points, loan-related fees, and gain on sale revenue, while also enhancing the growth of E*TRADE Bank’s portfolio and increasing the portfolio’s yields.

“The E*TRADE brand doesn’t stand for just brokerage anymore,” said Mitchell H. Caplan, managing director, North America and chief global banking and wealth management officer of E*TRADE Group, Inc. “E*TRADE continues to advance a successful diversification strategy with two goals in mind-creating superior value, choice and convenience for our customers and building a solid and profitable franchise that delivers ongoing value for our shareholders. By furthering the integration of E*TRADE Mortgage with our online brokerage, Internet banking and wealth management services, we continue to provide customers with the building blocks they need to construct a solid financial future.”

The newly launched E*TRADE Mortgage origination platform offers a fully- automated 100-percent-online application process, providing customers with added value such as rates and fees lower than the national average, rapid closings, instant rate locks and guaranteed closing costs. As a direct mortgage lender, E*TRADE owns and controls the entire loan origination process from start to finish, providing customers with the benefit of real-time interactive access through all stages of the loan application and closing process. A full range of mortgage products and services are available through etrademortgage.com, while E*TRADE Mortgage loan consultants are as close as a phone call to 1-800-546-EASY.

The launch of E*TRADE Mortgage is a major turning point in an ongoing integration process. As recently announced, E*TRADE Mortgage has secured more than $1 billion in funding exclusively through E*TRADE Bank, leveraging the integrated financial services model to realize significant cost savings and eliminate its dependence on third party warehouse lenders. In future stages of integration, E*TRADE Mortgage will be expanded to include additional mortgage products and services, such as home equity lines of credit and pledged asset loans. Likewise, functionality will be enhanced to provide seamless navigation across E*TRADE’s complete range of online brokerage, banking and wealth management products. Ultimately, E*TRADE Mortgage will serve as the cornerstone for E*TRADE’s proposed lending section.

E*TRADE Mortgage has positioned itself for steady growth and continues to maintain its leadership position as one of the largest online retail mortgage lenders, generating a total volume of more than $1.4 billion since the recent acquisition by E*TRADE only four months ago, with another $546 million locked loans in the pipeline. As the mortgage financing boom moves into its sixth month, monthly volumes at E*TRADE Mortgage continue to rise, reaching $494 million during May 2001 as compared to $385 million during April 2001, reaching a record month over month increase of 28.3%. In addition, E*TRADE Mortgage generated gross revenues of nearly $23.6 million since the acquisition, through origination points, loan-related fees and gain on sale of loans.

Mortgages are currently the third most widely used financial service product on the Internet. Through E*TRADE Mortgage’s efficient and direct lending platform, E*TRADE now offers a full range of mortgage products to gain another key competitive advantage by securing the core financial relationship with consumers and expanding cross-sell opportunities to its growing customer base.

About E*TRADE
E*TRADE is a global leader in online personal financial services, offering value-added investing, banking and research features, premium customer service and a redundant, proprietary Stateless Architecture® infrastructure. In addition to the U.S., E*TRADE presently serves customers in Australia, Canada, Denmark, Hong Kong, Israel, Korea, Japan, Norway, South Africa, Sweden, and the U.K. through branded web sites. E*TRADE Securities Inc. (Member NASD/SIPC), and its parent company, E*TRADE Group, Inc., have offices in Northern California, New York City and in other major business centers in the U.S. and worldwide.

About E*TRADE Bank
E*TRADE Bank is a wholly-owned subsidiary of E*TRADE Group, Inc. Deposits at E*TRADE Bank are insured up to $100,000 by the FDIC. E*TRADE Bank is the nation’s largest pure-play Internet bank with over $12.0 billion in assets, more than $6.7 billion in deposits and over 404,000 customer accounts as of March 31, 2001. E*TRADE Bank is the only pure-play Internet bank to be ranked among the top 18 federally chartered U.S. savings banks based on both assets and deposits according to FDIC data as of March 31, 2001. E*TRADE Bank is also affiliated with E*TRADE Access, Inc., now the largest off-premise ATM network in the U.S. and the third largest ATM network nationwide based on American Bankers Association Data as of July 27, 2000. E*TRADE Bank can be accessed at etradebank.com or 1-800-ETBANK-1.

About E*TRADE Mortgage
E*TRADE Mortgage is a branchless retail enterprise engaged in providing an array of mortgage products directly to consumers through a virtual loan origination platform and a dedicated proactive customer service team. Now authorized to make mortgage loans in all 50 states and the District of Columbia, E*TRADE Mortgage is a market leader known for low rates, simplicity, speed and certainty of delivery. Formerly known as LoansDirect, the mortgage company’s integrated user interface consistently receives high marks for customer satisfaction achieving a top ranking by Gomez Advisors and Inside Mortgage Technology. E*TRADE Mortgage can be accessed at etrademortgage.com or 1-800-546-EASY.

Important Notice
E*TRADE, the E*TRADE logo, E*TRADE Bank, Stateless Architecture, and LoansDirect are trademarks or registered trademarks of E*TRADE Group, Inc. or its subsidiaries. The statements contained in this news release that are forward-looking are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. The uncertainties and risks include, but are not limited to, changes in market activity, anticipated increases in the rate of new customer acquisition, the conversion of new visitors to the site to customers, seasonality, the development of new products and services, the enhancement of existing products and services, competitive pressures (including price competition), system failures, economic and political conditions, changes in consumer behavior and the introduction of competing products having technological and/or other advantages. Further information about these risks and uncertainties can be found in the information included in the annual report filed by the company with the SEC on Form 10-K (including information under the caption “Risk Factors”) and quarterly reports on Form 10-Q.

E*TRADE Bank and E*TRADE Securities, Inc. are affiliated but separate companies. Investment products made available from E*TRADE Securities, Inc. are not insured by the FDIC, are not guaranteed deposits or obligation of E*TRADE Bank and are subject to investment risk, including loss of principal amount invested.

System response and account access time may vary due to market conditions, trading volume, system performance and other factors.

For further information, please contact Deborah Newman of E*TRADE Bank, 703-247-3702, [email protected].

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/Web site: http://www.etrade.com/SOURCE: E*TRADE Group, Inc.; E*TRADE Bank