Major Asset Sales To Refocus
On Small Business Banking
July 24, 2008
2
Major Strategic Change for
IFC and Irwin Union Bank
z Irwin Union Bank to Focus on 137-Year
Heritage as Partner to Small Businesses and
Local Communities
z Home Equity Credit Risk To Be Substantially
Reduced Through Sale of $1.0 Billion Loan
Portfolio
– Ultimate Loss Risk Capped Through Structured
Finance Solution and Additional Reserves for
Remaining Exposure
z Sale of Leasing Assets Enhances Liquidity
and Capital Supporting Traditional Banking
Businesses
3
An Environmental Call for Change
z For the past 25 years, Irwin’s business model was
based on a core branch-based commercial bank,
supplemented with wholesale funds
z Macro issues have transformed the mortgage and
capital markets in past 12 months
– US/Global crisis in mortgage markets
– Securitization markets have largely closed
z Mortgage market driven losses have diverted
attention from Irwin’s traditional strengths with small
business and relationship-based lending in our
communities
4
History of Responding to
Environmental Changes
County
Bank
Slow growth
1871
1981
1995
1999
2000/2
2006/7
1H 2008
Founded
as Irwin’s
Bank
Acquired Inland
Mortgage
Corporation
Mortgage and
Housing Conditions
Rapid growth and
value creation
Started
Irwin Home
Equity
Divested
ST Medical
Leasing
Acquired
ST Medical
Leasing
Started Irwin
Franchise
Finance
Peak year
2003
Small Business Focused
National Expansion
Strategy
Divested
Irwin
Mortgage
Acquired
ST Equip.
Leasing
2008►
Exiting ST
Equip.
Leasing
Exiting
Irwin Home
Equity
Refocus
5
The Transformed Irwin
z Focus on relationships with small businesses, their
owners, and residents of communities surrounding
branches
– Full suite of loan, deposit and investment products
z $3.8 billion loan portfolio
z Branches in growing and diverse Midwest and Western
markets
z National “Preferred” SBA lender; in top 5% nationally in
annual originations (as measured in $s)
z Nationally-recognized provider of customized
comm