Bay View
                                   Capital Corporation
                   News Release
                   ------------




                                      NYSE:        BVC
                                      Web Site:    www.bayviewcapital.com
                                      Contact:     Mark E. Lefanowicz
                                                   (650) 294-7730
                                                   Edward H. Sondker
                                                   (650) 312-7373


FOR IMMEDIATE RELEASE


September 29, 2000


         BAY VIEW CAPITAL ANNOUNCES DEFERRAL OF DISTRIBUTIONS ON CAPITAL
                                   SECURITIES


     San Mateo,  California - Bay View  Capital  Corporation  (NYSE:  BVC) today
announced that it has entered into the agreement that it previously announced it
was negotiating  with the Board of Governors of the Federal  Reserve System.  In
addition to requiring  prior approval to pay common stock  dividends,  the final
agreement will also require the Company to obtain prior approval to disburse its
dividends associated with its 9.76% Capital Securities (NYSE: BVS).

     Bay View  initially  believed  that the  agreement  would  not  affect  the
dividend on its Capital  Securities as long as it met certain published capital,
liquidity,  and other requirements.  The Company has since been advised that the
prior approval of the Board of Governors of the Federal  Reserve and the Federal
Reserve  Bank of San  Francisco  to disburse  these  dividends  will be required
despite meeting those requirements.

     The Company has requested  approval to disburse the upcoming  September 30,
2000 quarterly  dividend but does not anticipate  receiving the Federal  Reserve
Board's approval. In such case, pursuant to the terms of the Capital Securities,
the Company will defer  distributions  on the  debentures.  During this deferral
period,  distributions  to which holders are entitled will continue to accrue at
an annual rate of 9.76% of the liquidation  amount of $25 per Capital  Security,
plus  accumulated   additional   distributions  at  the  same  rate,  compounded
quarterly,  on any unpaid  distributions  (to the extent  permitted by law). The
Company fully intends to continue to seek  permission to distribute the dividend
at the earliest opportunity.

     Bay View Capital  Corporation is a diversified  financial  services holding
company with over $6 billion in assets.  Headquartered in San Mateo, California,
it is the parent company of Bay View Bank, N.A. and its  subsidiaries,  Bay View
Acceptance  Corporation,  Bay  View  Commercial  Finance  Group,  and  Bay  View
Franchise Mortgage Acceptance Company.

<PAGE>

                           Forward-Looking Statements


     This press release contains  forward-looking  statements which describe the
Company's  future  plans,  strategies  and  expectations.   All  forward-looking
statements are based on assumptions and involve risks and uncertainties, many of
which are beyond  the  Company's  control  and which may cause  actual  results,
performance or  achievements  to differ  materially  from  anticipated  results,
performance  or   achievements.   Factors  that  might  affect   forward-looking
statements include, among other things:

o    the demand for the Company's products;
o    actions taken by the Company's competitors;
o    tax rate changes, new tax laws and revised tax law interpretations;
o    adverse changes occurring in the securities markets;
o    inflation and changes in prevailing  interest  rates that reduce margins or
     the fair value of the financial instruments held;
o    economic or business  conditions,  either  nationally  or in the  Company's
     market areas, that are worse than expected;
o    legislative  or  regulatory  changes that  adversely  affect the  Company's
     business;
o    the inability to sell or securitize assets;
o    the timing,  impact and other  uncertainties of asset sales or acquisitions
     and  the  Company's   success  or  failure  in  the  integration  of  their
     operations;
o    the ability to enter new geographic and product  markets  successfully  and
     capitalize on growth opportunities;
o    technological changes that are more difficult or expensive than expected;
o    increases  in  delinquencies  and  defaults  by  borrowers  and other  loan
     delinquencies;
o    increases in the provision for losses on loans and leases;
o    the inability to sustain or improve the performance of subsidiaries;
o    the  inability to achieve the financial  goals in the  Company's  strategic
     plans,  including any  financial  goals  related to both  contemplated  and
     consummated asset sales or acquisitions;
o    the outcome of lawsuits or regulatory disputes;
o    credit and other risks of lending, leasing and investment activities; and
o    the inability to use net operating loss carryforwards currently held by the
     Company.

     As a result of the above,  the Company cannot assure that future results of
operations or financial  condition or any other matters will be consistent  with
those  presented in any  forward-looking  statements.  Accordingly,  the Company
cautions you not to rely on these forward-looking  statements.  The Company does
not  undertake,  and  specifically  disclaims  any  obligation,  to update these
forward-looking statements, which speak only as of the date made.


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