American Home Mortgage Reports First Quarter Results; Announces Record Results For a First Quarter and Reaffirms Guidance

Business Wire, April 25, 2002

Business Editors

NEW YORK--(BUSINESS WIRE)--April 25, 2002

American Home Mortgage Holdings, Inc. (NASDAQ: AHMH), one of the nation's largest independent retail mortgage bankers, today reported financial results for the first quarter ended March 31, 2002.

The improvement in our first quarter results compared to the year ago period was primarily driven by strong loan production volumes, continued organic growth from existing branches and increased loan origination volume from the company's online mortgage channel, MortgageSelect.

FINANCIAL HIGHLIGHTS

- Earnings per share on a fully diluted basis for the first quarter was $0.54,
an increase of 92.9% over $0.28 for the same period in 2001, before cumulative
effect of change in accounting principle.

- Total revenue rose to $33.9 million, an increase of 53.9% over $22.1 million
for the same period in 2001.

- Total loan originations rose to $1.9 billion, an increase of 47.9% over $1.3
billion during the same period in 2001.

- Total e-commerce loan originations rose to $448.1 million, an increase of
122.7% over $201.0 million for the same period in 2001.

- Net income for the first quarter was $6.7 million, an increase of 164.6% over
$2.5 million during the same period in 2001, before cumulative effect of change
in accounting principle.

"The first quarter, which is historically the slowest quarter for mortgage loan demand, also saw the end of extraordinary refinance activity and a return to a more normal mortgage-lending environment," commented Michael Strauss, chairman, president and CEO of American Home Mortgage. "Loan originations were $1.9 billion compared to $2.6 billion during the fourth quarter and $1.3 billion during the first quarter of 2001.

"The second quarter of 2002 has started on a strong note, with applications during the first eighteen business days of April rising to a run rate of $2.9 billion per quarter compared to actual application volume of $2.7 billion during the first quarter. We are gratified by this increase, which we believe is in part attributable to our ongoing efforts to organically grow our business. These efforts include our new Atlanta region and its four new branches, as well as our new branches in Kansas City and Elmhurst, IL. They also include our expanding roster of Internet clients including five additional bank outsource clients.

"The first quarter was marked by a number of milestones. During the quarter, MortgageSelect announced that it has begun serving as the exclusive mortgage lender for CIBC's U.S. affiliate, Amicus Bank, and consequently for Amicus affiliates Safeway SELECT Bank and Marketplace Bank. Safeway SELECT Bank has locations in Safeway Supermarkets throughout the Western United States, while Marketplace Bank has locations in Winn Dixie supermarkets throughout Florida. During the quarter, MortgageSelect also welcomed five new bank clients for its outsourcing program and deployed new and advanced call center technology. Perhaps MortgageSelect's most important first quarter accomplishment was strongly demonstrating its ability to win the loan business of homebuyer customers and refinance customers.

"Also during the first quarter, we announced the addition of three key senior managers, including our new CFO, Steve Hozie, our new Chief Compliance Officer and General Auditor, Wade Hotsenpiller, and our new Vice President for East Coast Wholesale, Lisa Schreiber. We are pleased that such qualified professionals have joined our ranks."

Operating Statistics
--------------------
                                      1Q'02              1Q'01
                                      ------            -------
 Total Loan Originations            $1.9 billion       $1.3 billion

 Retail E-Commerce
   Loan Originations                $448 million       $201 million

 Loans Sold                         $2.0 billion       $1.2 billion

 Principal Amount of
  Applications Accepted             $2.7 billion       $3.0 billion

 Principal Amount of End of
  Period Application Pipeline       $1.9 billion       $604 million

 Number of Branches                           72                 55

Mr. Strauss continued: "We remain committed to growing our business through accretive acquisitions that meet our financial and operating criteria. As we have described, during the past twelve months the price expectations of potential mortgage company sellers were prohibitive, and consequently, we were unable to acquire franchise that satisfy our acquisition criteria. I am pleased to report that as the environment has changed, the expectations of sellers has adjusted to the point where we are again finding accretive acquisition opportunities. I strongly believe these accretive acquisitions will fuel our growth during the remainder of the year as they did in 2000.

"Absent accretive acquisitions we believe our existing franchise will provide earnings in line with the guidance we gave last quarter and we reaffirm that guidance today. Our guidance is for annual earnings per share of $2.25 to $2.35, including $0.37 to $0.45 during the second half of the year as a result of our pending acquisition of Valley Bancorp. Our acquisition of Valley continues to be among our most important strategic initiatives and, thus far, is proceeding through the regulatory review and approval process as expected.