Anchor BanCorp Wisconsin Inc. Announces Record Third Quarter Earnings and a Stock Repurchase...

Business Editors

MADISON, Wis.--(BUSINESS WIRE)--Jan. 23, 2002

Anchor BanCorp Wisconsin Inc. announced record net income of $8.8 million for the quarter ended December 31, 2001, which compares to $6.5 million for the same period in 2000. Net income for the nine-month period ended

December 31, 2001 was $25.0 million, which compares to $20.0 million for the nine-month period ended December 31, 2000. Diluted earnings per share were $.37 for the quarter and $1.09 for the nine-month period ended December 31, 2001. This compares to $.28 for the quarter and $.86 for the nine-month period ended December 31, 2000.

"I am pleased to report net interest margin continues to improve. For the quarter, net interest margin increased from 2.68% to 3.27% and for the nine-month period it increased from 2.80% to 3.03%" said Douglas J. Timmerman, President.

During the quarter, Anchor BanCorp's merger with Ledger Capital Corp was completed resulting in the issuance of approximately 2.5 million shares of Anchor BanCorp common stock. In addition, AnchorBank's Green Bay lending-only office was closed and a full service office was opened in Howard, Wisconsin which is a suburb of Green Bay.

On January 17, 2002, Anchor BanCorp Wisconsin Inc.'s Board of Directors authorized the repurchase of up to 5% or approximately 1.225 million shares of its outstanding common stock in the open market.

The repurchases are authorized to be made from time to time in open-market and/or negotiated transactions as, in the opinion of management, market conditions may warrant. Purchases are expected to begin on or after February 1, 2002. The repurchased shares will be held as treasury stock and will be available for general corporate purposes. Anchor will utilize various securities brokers as its agent for the stock repurchase program.

Anchor BanCorp's stock is traded on the over-the-counter market under the NASDAQ symbol ABCW. AnchorBank fsb, the wholly-owned subsidiary, has 54 full service offices and two loan origination only offices. All are located in Wisconsin.

For more information, contact Michael Helser, CFO at (608)252-1810 or Douglas J. Timmerman, President, at (608)252-8782.

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                     ANCHOR BANCORP WISCONSIN INC.
                         FINANCIAL HIGHLIGHTS
----------------------------------------------------------------------
           (Dollars in thousands - except per share amounts)
                              (Unaudited)


                             Three Months Ended     Nine Months Ended
                                December 31,           December 31,
                            --------------------  --------------------
                               2001       2000        2001       2000
                            --------------------  --------------------
Operations Data:
 Net interest income          $ 25,787  $ 19,776    $ 70,075  $ 60,192
 Provision for loan losses         150       150         910       495

 Gain on sale of loans           2,347       609       5,663     2,177
 Other non-interest income       1,329     2,469       8,140     7,836
 Non-interest expense           15,036    12,892      43,337    38,424
 Income before income taxes     14,277     9,812      39,631    31,286

 Income taxes                    5,463     3,345      14,667    11,253

 Net income                      8,814     6,467      24,964    20,033


Selected Financial Ratios (1):
 Yield on earning assets         7.26%     7.98%       7.36%     7.91%

 Cost of funds                    4.08      5.50        4.53      5.30

 Interest rate spread             3.18      2.48        2.83      2.61
 Net interest margin              3.27      2.68        3.03      2.80

 Return on average assets         1.04      0.83        1.04      0.88
 Return on average equity        14.64     12.16       14.32     12.58
 Average equity to average
  assets                          7.11      6.83        7.25      7.02
 Non-interest expense to
  average assets                  1.78      1.66        1.80      1.69



Per Share:

 Basic earnings per share       $ 0.38    $ 0.29      $ 1.12    $ 0.88

 Diluted earnings per share       0.37      0.28        1.09      0.86
 Dividends per share              0.08      0.08        0.24      0.22

 Book value per share            10.45      9.31         n/a       n/a


                                        December 31,
                                ------------------------      Percent
                                    2001         2000          Change
                                ------------------------   -----------

Financial Condition:
 Total assets                   $ 3,579,446   $3,137,669       14.1%
 Loans receivable, net

  Held for sale                      60,307        8,126       642.1

  Held for investment             2,694,380    2,384,497        13.0

 Investment securities available
  for sale, at fair value            54,162       20,491       164.3
 Investment securities held to
  maturity, at amortized cost         9,869       49,580       (80.1)
 Mortgage-related securities
  available for sale, at
  fair value                        157,958      183,610       (14.0)
 Mortgage-related securities
  held to maturity, at amortized
  cost                              162,464      212,297       (23.5)
 Deposits                         2,558,028    2,067,805        23.7
 Borrowings                         659,129      781,022       (15.6)
 Stockholders' equity               259,654      213,373        21.7
 Allowance for loan losses           31,744       24,077        31.8
 Non-performing assets               12,497        6,713        86.2

--------------------------------
(1) Annualized when appropriate.


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                     ANCHOR BANCORP WISCONSIN INC.
            CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
----------------------------------------------------------------------
                                              (Unaudited)
                                              December 31,   March 31,
                                                 2001         2001
                                            --------------------------
                                                    (In Thousands)
Assets
 Cash and cash equivalents                    $ 236,452     $ 105,042
 Investment securities available
   for sale, at fair value                       54,162        22,216
 Investment securities held to
   maturity, at amortized cost                    9,869        33,913
 Mortgage-related securities available
   for sale, at fair value                      157,958       173,968
 Mortgage-related securities held to
   maturity, at amortized cost                  162,464       205,191
 Loans receivable, net
  Held for sale                                  60,307        17,622
  Held for investment                         2,694,380     2,414,976
 Foreclosed properties and repossessed
   assets, net                                    2,063           313
 Real estate held for development and sale       46,561        48,658
 Office properties and equipment                 31,091        25,734
 Other assets                                   124,139        79,841
                                            -----------   -----------
    Total assets                            $ 3,579,446   $ 3,127,474
                                            ============  ============

Liabilities and Stockholders' Equity
 Deposits                                   $ 2,558,028   $ 2,119,320
 Borrowings                                     659,129       740,598
 Advance payments by borrowers for
   taxes and insurance                            1,057         7,918
 Other liabilities                              101,578        40,026
                                            -----------   -----------
    Total liabilities                         3,319,792     2,907,862
                                            -----------   -----------

 Preferred stock, $.10 par value,
   5,000,000 shares authorized,
   none outstanding                                   -             -
 Common stock, $.10 par value,
   100,000,000 shares authorized,
   25,363,339 shares issued                       2,536         2,536
 Additional paid-in capital                      46,648        56,571
 Retained earnings, substantially restricted    215,199       197,599
 Accumulated other comprehensive income           3,353         1,954
 Treasury stock (517,433 shares and
   2,548,416 shares,
   respectively), at cost                        (8,140)      (38,339)
 Common stock purchased by benefit plans             58          (709)
                                            -----------   -----------
    Total stockholders' equity                  259,654       219,612
                                            -----------   -----------
    Total liabilities and stockholders'
      equity                                $ 3,579,446   $ 3,127,474
                                            ===========   ===========

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                     ANCHOR BANCORP WISCONSIN INC.
                   CONSOLIDATED STATEMENTS OF INCOME
----------------------------------------------------------------------
                            (Unaudited)

                         Three Months Ended       Nine Months Ended
                            December 31,             December 31,
                        ---------------------  ----------------------
                            2001        2000        2001       2000
                        ---------------------  ----------------------
Interest income:
  Loans                $   50,205  $   51,416  $  147,752  $  148,621
  Mortgage-related
   securities               4,807       4,405      15,771      13,722
  Investment securities
   and interest-bearing
   deposits                 2,136       3,119       6,405       7,941
                       ----------  ----------  ----------  ----------
   Total interest
    income                 57,148      58,940     169,928     170,284

Interest expense:
  Deposits                 23,125      26,319      72,022      71,625
  Notes payable
   and other                8,236      12,845      27,831      38,467
                       ----------  ----------  ----------  ----------
   Total interest
    expense                31,361      39,164      99,853     110,092
                       ----------  ----------  ----------  ----------
   Net interest income     25,787      19,776      70,075      60,192
Provision for
 loan losses                  150         150         910         495
                       ----------  ----------  ----------  ----------
   Net interest income
    after provision for
    loan losses            25,637      19,626      69,165      59,697

Non-interest income:
  Service charges
   on deposits              1,706       1,512       4,869       4,350
  Gain on sale of loans     2,347         609       5,663       2,177
  Other income              (377)         957       3,271       3,486
                       ----------  ----------  ----------  ----------
   Total non-interest
    income                  3,676       3,078      13,803      10,013

Non-interest expense:
  Compensation              8,407       7,210      24,208      21,325
  Occupancy                 1,193       1,112       3,385       3,199
  Federal insurance
   premiums                   101          97         299         289
  Other                     5,335       4,473      15,445      13,611
                       ----------  ----------  ----------  ----------
   Total non-interest
    expense                15,036      12,892      43,337      38,424
                       ----------  ----------  ----------  ----------
   Income before
    income taxes           14,277       9,812      39,631      31,286
Income taxes                5,463       3,345      14,667      11,253
                       ----------  ----------  ----------  ----------
   Net income          $    8,814  $    6,467  $   24,964  $   20,033
                       ==========  ==========  ==========  ==========


Earnings per share:
Basic                      $ 0.38     $ 0.29       $ 1.12      $ 0.88
Diluted                      0.37       0.28         1.09        0.86