Related Special Charge Contributes to $1.93 Per Share First Quarter Net Loss

    MINNEAPOLIS, April 24 /PRNewswire/ -- Olympic Financial Ltd. (NYSE: OLM)
today reported a net loss, after special charges, of $75.3 million, or
$1.93 per share, for the first quarter ended March 31, 1997.  In the 1996
first quarter, the company reported net income of $11.1 million, or $.37 per
fully diluted share. The 1997 first quarter charges include:
    -- An after-tax, non-cash charge of $63.9 million, or $1.64 per share, to
reflect a change in accounting estimates for recovery rates on repossessed
inventory and a change in policies resulting from a shift in operating
strategy pursuant to which the company has modified its retail remarketing
activities;
    -- An extraordinary charge of $15.8 million after-tax, or $.41 per share,
due to the early retirement of $145 million of the company's 13% Senior Notes
and related prepayment fees, professional fees and charge-off of capitalized
debt financing costs.
    Modified Retail Remarketing Strategy
    Richard A. Greenawalt, who joined Olympic as president and chief executive
officer on January 29, said the company believes that recovery rates are not
likely to increase above the level experienced during the first quarter of
1997.  Consequently, the company changed its accounting estimates regarding
expected recovery rates on repossessed inventory.  Furthermore, the company
adopted modifications to its retail disposition strategy that are intended to
reduce liquidity requirements and establish more efficient operating
procedures.  As a result, it is expected that the company will increase the
use of wholesale auctions to control inventory size and the costs associated
with the operation of its retail remarketing program, and as a consequence
thereof reduce overall recovery rates achieved.  These changes were approved
by the Board of Directors on April 21, 1997.
    Going forward, reserves will assume loan loss recoveries equivalent to
those which are expected to be achieved through wholesale disposition of
repossessed vehicles -- currently 60 percent of loan balances, compared to
81 percent previously used.  Any recoveries in excess of reserves, which may
occur through the use of retail disposition methods, will be realized as
incremental profit as vehicles are sold.  "This change bases our gain on sale
assumptions on a lower wholesale recovery rate.  We believe wholesale recovery
rates to be consistently achievable," said Greenawalt.
    Under the newly implemented strategy, retail remarketing will operate
under the leadership of Robert A. Barbee, executive vice president, sales and
marketing.  "This new approach makes our retail remarketing activities a
potential source of incremental profits while positioning our core business to
deliver sustained, predictable profitability," said Greenawalt.  "As a
potential source of profit, retail remarketing will operate under revised
controls, particularly with respect to the length of time inventory will be
held for retail sale.  Incentives are in place to focus the management of this
area on increasing the profits we can derive from retail disposition."
    Greenawalt said the company plans to continue to dispose of a significant
percentage of its repossession inventory through retail channels.  During the
1997 first quarter, approximately 65 percent of repossessed vehicle
dispositions were accomplished through retail sales at selected dealerships.
    The company is increasing its loan loss reserves to reflect a reduction in
the estimate of loan balances recoverable on repossessed vehicles, as well as
other assumptions implicit in its accounting for gains on the sale of
automobile loans.  The changes in accounting estimates and policies are based
on assumptions regarding future loan losses and are reflected in the company's
operating results for the first quarter and in the estimated results for
future quarters, as well.  The revisions are summarized below:
    -- As discussed above, reserves will assume loan loss recoveries
equivalent to those which are expected to be achieved through wholesale
disposition, currently 60 percent of loan balances, compared to 81 percent
previously used.
    -- Servicing costs for loans held by securitization trusts will be assumed
to be 1.25 percent annually of the remaining principal balance, up from 1.00
percent previously.  "This adjustment provides the flexibility to continue
strengthening our servicing and collections infrastructure and recognizes the
higher servicing costs we may incur as we increase the percentage of higher
yielding Classic Program loans in our servicing portfolio," said Greenawalt.
    -- The discount rate used in gain on sale calculations will be increased
to 350 basis points above the treasury rate at the time of securitization, up
from 250 basis points, aligning the company's discount rate assumption more
closely with that of its peer group of consumer financial services companies.
    "With these changes to our accounting estimates regarding recovery rates
on repossessed inventory and a change in policies due to a shift in operating
strategy, we expect to allay investor concerns about the quality of our
earnings.  We believe we are positioning Olympic to deliver predictable and
sustainable profitability that enhances shareholder value long term.  Loan
volumes and net interest rate spreads remain at levels that should enable us
to achieve attractive profitability," said Greenawalt.   The company said it
expects net income from operations for the 12 months ending March 31, 1998 to
reach at least $1.00 per share before any incremental profits that may be
derived from retail remarketing activities.
    "The strategy complements our strengthened loan loss reserves and ongoing
improvements in loan servicing resources and infrastructure,"  said
Greenawalt. "Credit quality in our loan portfolio appears to be stable.  Loans
delinquent more than 30 days were 2.34 percent of the portfolio at the end of
the first quarter compared to 2.64 percent at the end of the 1996 fourth
quarter.  We believe this improvement results from the steps we have been
taking to strengthen our overall servicing and collections effectiveness."
Loan loss reserves currently stand at 4.70 percent of the servicing portfolio,
or $197 million.
    Greenawalt noted that the underwriter of the company's financial guarantee
insurance, Financial Security Assurance Inc., (FSA) and Olympic's two
principal sources of warehouse funding, Bank of America and J.P. Morgan, have
been updated on the accounting adjustments and the shift in operating
strategy.  Bank of America and J.P. Morgan supported recent changes to the
terms of the company's warehouse facilities to accommodate the accounting
adjustments and the change in operating strategy.  "Our relationships with
FSA, Bank of America and J.P. Morgan are intact," said Greenawalt.  "Our
capital structure remains sound and healthy as evidenced by debt-to-equity and
equity-to-managed-assets ratios that -- even on an as-adjusted basis -- are in
line with those of top-performing financial services companies."
    Greenawalt also noted the recent addition of two seasoned executives to
the senior management team at Olympic.  Duane White has joined the firm as
Executive Vice President of Corporate Services, a newly created position.  Mr.
White's experience at First Bank System and McKinsey & Company spans 20 years.
At First Bank System, he was president of a mortgage banking subsidiary and
senior vice president of acquisitions and held numerous positions in consumer
and small business lending.  Mike Oleson joins the company as Senior Vice
President of Loan Servicing with more than 20 years of operating experience at
Citicorp and Ford Motor Credit in automobile and credit card lending and
collections.
    "These two talented individuals are choosing to join Olympic at a
transitional time in our company's history.  They add skills, expertise and
experience that will help us meet our objectives," said Greenawalt.  "We plan
to further strengthen our management team with two more appointments of senior
executives to the newly created positions of Corporate Risk Policy and
Information Resource Management."
    Review of First Quarter Operations
    -- Olympic purchased $781.9 million in automobile loans during the first
quarter, up 23 percent from $633.5 million in the comparable 1996 period.
Classic Program loans accounted for 48 percent of loans purchased during the
quarter and Premier Program loans accounted for 52 percent. Classic Program
loan penetration is expected to increase to over 50 percent of loan purchases
over the remainder of 1997.
    -- Loans delinquent more than 30 days were 2.34 percent for the 1997 first
quarter compared to 2.64 percent in the 1996 fourth quarter and 1.69 percent
in the 1996 first quarter.  Annualized net loan losses for the first quarter
of 1997 were 4.48 percent, after the special charge, compared to 1.27 percent
in the 1996 fourth quarter and 0.79 percent in the 1996 first quarter.
Pre-adjusted losses for the six month rolling rate as calculated under the old
13% Senior Note indenture were 1.60 percent as of the first quarter.
    -- The loan servicing portfolio totaled $4.2 billion at March 31, 1997
compared to $2.6 billion at March 31, 1996.
    -- Loans securitized during the quarter ending March 31, 1997  totaled
$774.7 million.  The net interest rate spread on loans securitized during the
quarter was 7.83 percent compared to 7.45 percent in the 1996 fourth quarter
and 6.65 percent in the first quarter of 1996.
    -- The company completed a public offering of 300,000 units consisting of
11.5% Senior Notes due 2007 with attached warrants to purchase 2,052,000
shares of common stock, realizing net proceeds of approximately $291 million.
    -- In March, the company opened a new Regional Buying Center in Baltimore,
Maryland, bringing the total number of Buying Centers to 18.
    Olympic Financial Ltd. is a Minneapolis-based consumer financial services
company specializing in purchasing, selling and servicing retail installment
contracts for new and used automobiles originated by more than 8,300 dealers
in 42 states.  The company, founded in 1990, is the nation's largest
independent provider of automobile financing.  Its 18 Regional Buying Centers
are located in Arizona; northern and southern California; Colorado; Florida;
Georgia; Maryland; Massachusetts; Minnesota; Missouri; New York; North
Carolina; Ohio; Tennessee; north, south and west Texas; and Washington.
    This news release contains forward-looking statements including but not
limited to projections of future earnings and originations volumes that are
subject to certain risks and uncertainties that could cause actual results to
differ materially from those projected.  The most significant among these
risks and uncertainties are (i) the company's ability to achieve adequate
interest rate spreads, (ii) the level of delinquencies, gross charge-offs and
net losses, and (iii) the level of operating expenses.  Earnings may also be
affected by the effects of economic factors on consumer debt and by
competitive pressures.  Additional risks which may affect the company's future
performance are detailed under the caption "Management's Discussion and
Analysis - Cautionary Statements" in the Company's Quarterly Report on Form
10-Q filed April 24, 1997, and as set forth under the caption "Cautionary
Statements" in Exhibit 99.1 to the company's Annual Report on Form 10-K.

    Olympic Financial LTD
    Selected Financial and Other Operating Data
    March 31, 1997
                                                       Three months ended
                                                      March 31,      March 31,
    Dollars in thousands, except per share data         1997           1996
    REVENUES:
      Net interest margin                         $    18,365    $    12,300
      Gain on sale of loans                           (77,887)        25,229
      Servicing fee income                              9,478          5,743
      Other non-interest income                         2,181            724
        Total revenues                                (47,863)        43,996
    EXPENSES:
      Operating expenses                               40,643         20,016
      Long term debt and other interest expense         7,591          5,516
        Total expenses                                 48,234         25,532
      Operating income (loss) before income taxes
       and extraordinary item                         (96,097)        18,464
        Income tax expense (benefit)                  (36,586)         7,386
      Net income (loss) before extraordinary item     (59,511)        11,078
        Extraordinary item                            (15,828)             -
      Net income (loss)                           $   (75,339)   $    11,078

    Primary Earnings Per Share:
      Income (loss) per common share
       before extraordinary item                  $     (1.52)    $     0.41
      Extraordinary item per common share               (0.41)             -
      Net income (loss) per common share          $     (1.93)    $     0.41
    Fully Diluted Earnings Per Share:
      Income (loss) per share
       before extraordinary item                  $     (1.52)    $     0.37
      Extraordinary item per share                      (0.41)             -
      Net Income (loss) per share                 $     (1.93)    $     0.37

    Weighted average common and common equivalent
     shares outstanding
      Primary                                      39,028,087    25,741,672
      Fully diluted                                39,197,539    30,218,329

    Number of automobile dealers                        8,303         5,874
    Number of buying centers                               18            16
    Servicing portfolio (in millions)             $   4,194.6   $   2,645.1
    Automobile loan purchases (in millions)       $     781.9   $     633.5
    Delinquencies as a percentage
     of servicing portfolio                              2.34%         1.69%
    Annualized net losses as a percentage
     of average servicing portfolio                      4.48%         0.79%
    Book value per common share                   $      8.65   $      7.38


    Dollars in thousands                             March 31,    December 31,
    ASSETS                                              1997           1996
      Cash and cash equivalents                   $    23,596     $    16,057
      Due from securitization trust                   157,694         177,076
      Auto loans held for sale                         40,037          36,285
      Finance income receivable                       301,045         362,916
      Restricted cash in spread accounts              164,091         142,977
      Other assets                                     52,086          42,919
        Total assets                              $   738,549     $   778,230

    LIABILITIES AND SHAREHOLDERS' EQUITY
      Amounts due under warehouse facilities      $    30,927     $   111,140
      Senior term notes                               291,457         145,000
      Subordinated notes                               52,804          53,689
      Capital lease obligations                         7,218           7,729
      Deferred income taxes                             8,100          54,387
      Accounts payable and accrued liabilities         18,940          13,192
        Total liabilities                             409,446         385,137
      Shareholders' equity                            329,103         393,093
        Total liabilities and shareholders' equity $  738,549     $   778,230

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