##### 









SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


Form 10-Q

|   |  |                                                                                                 
|-- |  | ------------------------------------------------------------------------------------------------
|þ  |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR
    15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934 
|  
|   |  | For the quarterly period ended March 31,
    2003                                               
|  
|or
|  
|o  |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR
    15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
|  
|   |  | For the transition period
    from           to                                                 

Commission file number 1-8972

IndyMac Bancorp, Inc.

(Exact name of registrant as specified in its
charter)


|                                                                                            |  |                                         
|------------------------------------------------------------------------------------------- |  | ----------------------------------------
|Delaware                                                                                    |  | 95-3983415                              
|(State or other jurisdiction of
    incorporation or organization)                          |  | (I.R.S. Employer
    Identification No.)
|                                                                                           
|155 North Lake Avenue,
    Pasadena, California(Address of principal executive
    offices) |  | 91101-7211(Zip Code)                    

Registrants telephone number, including
area code:

(800)669-2300


Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and
(2) has been subject to such requirements for the past
90 days.     Yes þ          No o

Indicate the number of shares outstanding of each
of the issuers classes of common stock, as of the latest
practicable date.

Common stock outstanding as of April 22,
2003: 55,217,166 shares



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FORM 10-Q QUARTERLY REPORT

For the Period Ended March 31,
2003


TABLE OF CONTENTS

|                                   |  |                                                                                           |  |      |    | 
|---------------------------------- |  | ----------------------------------------------------------------------------------------- |  | ---- | -- | 
|                                   |  |                                                                                           |  | Page
|                                   |  |                                                                                           |  |     
|PART I.  FINANCIAL
    INFORMATION
|                                   |  | Forward-looking Statements                                                                |  |      | 2  | 
|Item 2.                            |  | Managements Discussion and Analysis of
    Financial Condition and Results of Operations |  |      | 2  | 
|                                   |  | Highlights for the Quarter                                                                |  |      | 2  | 
|                                   |  | Overall Results                                                                           |  |      | 4  | 
|                                   |  | Our Business                                                                              |  |      | 4  | 
|                                   |  | Mortgage Banking Activities                                                               |  |      | 10 | 
|                                   |  | Loan Production                                                                           |  |      | 10 | 
|                                   |  | Mortgage Production
    by Division and Channel                                           |  |      | 10 | 
|                                   |  | Loan Sales                                                                                |  |      | 13 | 
|                                   |  | Investing Activities                                                                      |  |      | 15 | 
|                                   |  | Investment
    Portfolio Group                                                            |  |      | 15 | 
|                                   |  | Construction Lending                                                                      |  |      | 23 | 
|                                   |  | HELOC Portfolio                                                                           |  |      | 25 | 
|                                   |  | Net Interest Income                                                                       |  |      | 25 | 
|                                   |  | Overall Interest Rate Risk Management                                                     |  |      | 27 | 
|                                   |  | Credit Risk and Reserves                                                                  |  |      | 29 | 
|                                   |  | General                                                                                   |  |      | 29 | 
|                                   |  | Secondary Market Reserve                                                                  |  |      | 32 | 
|                                   |  | Operating Expenses                                                                        |  |      | 33 | 
|                                   |  | Dividend Policy                                                                           |  |      | 34 | 
|                                   |  | Future Outlook                                                                            |  |      | 34 | 
|                                   |  | Liquidity and Capital Resources                                                           |  |      | 34 | 
|                                   |  | Overview                                                                                  |  |      | 34 | 
|                                   |  | Principal Sources of Cash                                                                 |  |      | 35 | 
|                                   |  | Principal Uses of Cash                                                                    |  |      | 37 | 
|                                   |  | Accumulated Other Comprehensive Loss                                                      |  |      | 37 | 
|                                   |  | Regulatory Capital Requirements                                                           |  |      | 37 | 
|                                   |  | Key Operating Risks                                                                       |  |      | 38 | 
|                                   |  | Interest Rate Risk                                                                        |  |      | 39 | 
|                                   |  | Valuation Risk                                                                            |  |      | 39 | 
|                                   |  | Credit Risk                                                                               |  |      | 39 | 
|                                   |  | Liquidity Risk/Access to Capital
    Markets                                              |  |      | 39 | 
|                                   |  | Government Regulation and Monetary
    Policy                                             |  |      | 40 | 
|                                   |  | Competition                                                                               |  |      | 40 | 
|                                   |  | Other Risks                                                                               |  |      | 40 | 
|                                   |  | Critical Accounting Policies                                                              |  |      | 41 | 
|Item 3.                            |  | Quantitative and Qualitative Disclosure about
    Market Risk                             |  |      | 41 | 
|Item 1.                            |  | Financial Statements (Unaudited)                                                          |  |      |    | 
|                                   |  | Consolidated Balance Sheets                                                               |  |      | 42 | 
|                                   |  | Consolidated Statements of Earnings                                                       |  |      | 43 | 
|                                   |  | Consolidated Statements of Shareholders
    Equity and Comprehensive Income              |  |      | 44 | 
|                                   |  | Consolidated Statements of Cash Flows                                                     |  |      | 45 | 
|                                   |  | Notes to Consolidated Financial Statements                                                |  |      | 46 | 
|Item 4.                            |  | Controls and Procedures                                                                   |  |      | 49 | 
|PART II.  OTHER
    INFORMATION   
|Item 6.                            |  | Exhibits and Reports on Form 8-K                                                          |  |      | 49 | 

1



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##### 



FORWARD-LOOKING STATEMENTS

This Form 10-Q contains statements that may
be deemed to be forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements include statements regarding our
projected financial condition and results of operations, plans,
objectives, future performance and business. Forward-looking
statements typically include the words anticipate,
believe, estimate, expect,
project, plan, forecast,
intend and other similar expressions. These
statements reflect our current views with respect to future
events and financial performance. They are subject to risks and
uncertainties that could cause future results to differ
materially from historical results or from the results
anticipated. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of
their dates or as of the date hereof if no other date is
identified. We undertake no obligation to update or revise any
forward-looking statements, whether as a result of new
information, future events or otherwise. For further information
on our key operating risks, refer to IndyMacs annual
report on Form 10-K for the year ended December 31,
2002.

References to IndyMac Bancorp or
the Parent Company refer to the parent company alone
while references to IndyMac, the
Company, or we refer to IndyMac Bancorp,
Inc. and its consolidated subsidiaries. References to
IndyMac Bank or the Bank refer to our
subsidiary IndyMac Bank, F.S.B. and its consolidated
subsidiaries. The following discussion addresses the
Companys financial condition and results of operations for
the three months ended March 31, 2003.

ITEM 2.     MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS



HIGHLIGHTS FOR THE QUARTER


Highlights for the quarter ended March 31,
2003 were as follows:

|                 |                                                         |                                              |   |           |        |              |   |       |        |  |   |       |        | 
|---------------- | ------------------------------------------------------- | -------------------------------------------- | - | --------- | ------ | ------------ | - | ----- | ------ |  | - | ----- | ------ | 
|                 |                                                         |                                             
|                 |                                                         | Three Months Ended                          
|                 |                                                         |                                             
|                 |                                                         | March 31,                                    |   | March 31, |        | December 31,
|                 |                                                         | 2003                                         |   | 2002      |        | 2002        
|                 |                                                         |                                              |   |           |        |             
|                 |                                                         |                                             
|                 |                                                         | (Dollars in millions, except per share data)
|Income Statement |                                                         |                                              |   |           |        |              |   |       |        |  |   |      
|                 | Net interest income after provision for loan
    losses |                                              | $ | 60        |        |              | $ | 50    |        |  | $ | 50    |       
|                 | Gain on sale of loans                                   |                                              | $ | 84        |        |              | $ | 77    |        |  | $ | 75    |       
|                 | Other income                                            |                                              | $ | 13        |        |              | $ | 14    |        |  | $ | 19    |       
|                 | Net revenues                                            |                                              | $ | 157       |        |              | $ | 141   |        |  | $ | 144   |       
|                 | Operating expenses                                      |                                              | $ | 96        |        |              | $ | 80    |        |  | $ | 95    |       
|                 | Net earnings                                            |                                              | $ | 37        |        |              | $ | 36    |        |  | $ | 36    |       
|Per Share Data   |                                                         |                                              |   |           |        |              |   |       |        |  |   |      
|                 | Basic earnings per share                                |                                              | $ | 0.67      |        |              | $ | 0.60  |        |  | $ | 0.65  |       
|                 | Diluted earnings per share                              |                                              | $ | 0.66      |        |              | $ | 0.58  |        |  | $ | 0.63  |       
|                 | Dividends declared per share                            |                                              | $ | 0.10      |        |              | $ | 0.00  |        |  | $ | 0.00  |       
|                 | Book value per share at end of quarter                  |                                              | $ | 15.99     |        |              | $ | 14.61 |        |  | $ | 15.50 |       
|                 | Closing price per share                                 |                                              | $ | 19.45     |        |              | $ | 24.70 |        |  | $ | 18.49 |       
|                 | Average Common Shares (in thousands)                    |                                              |   |           |        |              |   |       |        |  |   |       |       
|                 |                                                         | Basic                                        |   |           | 54,827 |              |   |       | 60,228 |  |   |       | 55,025 | 
|                 |                                                         | Diluted                                      |   |           | 55,979 |              |   |       | 62,043 |  |   |       | 56,188 | 

2



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##### 



|                                           |                                                                          |                                              |   |           |   |              |   |        |   |  |   |        |  
|------------------------------------------ | ------------------------------------------------------------------------ | -------------------------------------------- | - | --------- | - | ------------ | - | ------ | - |  | - | ------ | -
|                                           |                                                                          |                                             
|                                           |                                                                          | Three Months Ended                          
|                                           |                                                                          |                                             
|                                           |                                                                          | March 31,                                    |   | March 31, |   | December 31,
|                                           |                                                                          | 2003                                         |   | 2002      |   | 2002        
|                                           |                                                                          |                                              |   |           |   |             
|                                           |                                                                          |                                             
|                                           |                                                                          | (Dollars in millions, except per share data)
|Performance Ratios                         |                                                                          |                                              |   |           |   |              |   |        |   |  |   |       
|                                           | Return on average equity (annualized)                                    |                                              |   | 17.20     | % |              |   | 16.89  | % |  |   | 16.55  | %
|                                           | Return on average assets (annualized)                                    |                                              |   | 1.49      | % |              |   | 1.96   | % |  |   | 1.56   | %
|                                           | Dividend payout ratio(1)                                                 |                                              |   | 14.93     | % |              |   | 0.00   | % |  |   | 0.00   | %
|                                           | Net interest income to pretax income                                     |                                              |   | 103.29    | % |              |   | 87.23  | % |  |   | 113.45 | %
|                                           | Average cost of funds                                                    |                                              |   | 3.20      | % |              |   | 4.62   | % |  |   | 3.53   | %
|                                           | Net interest margin                                                      |                                              |   | 2.80      | % |              |   | 3.21   | % |  |   | 2.69   | %
|                                           | Efficiency ratio(2)                                                      |                                              |   | 60        | % |              |   | 55     | % |  |   | 63     | %
|                                           | Capital to net revenue ratio(3)                                          |                                              |   | 1.36      | % |              |   | 1.48   | % |  |   | 1.42   | %
|                                           | Capital adjusted efficiency ratio(4)                                     |                                              |   | 81        | % |              |   | 81     | % |  |   | 90     | %
|                                           | Operating expenses to loan production                                    |                                              |   | 1.45      | % |              |   | 1.89   | % |  |   | 1.44   | %
|                                          
|Balance Sheet and Asset Quality
    Ratios |                                                                          |                                              |   |           |   |              |   |        |   |  |   |       
|                                           | Debt to equity ratio(5)                                                  |                                              |   | 9.7:1     |   |              |   | 7.1:1  |   |  |   | 10.3:1 |  
|                                           | Core capital ratio(6)                                                    |                                              |   | 9.14      | % |              |   | 10.09  | % |  |   | 8.70   | %
|                                           | Risk-based capital ratio(6)                                              |                                              |   | 14.83     | % |              |   | 15.88  | % |  |   | 15.02  | %
|                                           | Non-performing assets to total assets                                    |                                              |   | 1.03      | % |              |   | 1.68   | % |  |   | 1.05   | %
|                                           | Allowance for loan losses to total loans held for
    investment         |                                              |   | 1.20      | % |              |   | 1.90   | % |  |   | 1.28   | %
|                                           | Allowance for loan losses and other reserves to
    non-performing loans |                                              |   | 83        | % |              |   | 54     | % |  |   | 91     | %
|                                           | Allowance for loan losses to annualized net
    charge-offs              |                                              |   | 347       | % |              |   | 285    | % |  |   | 144    | %
|                                           | Provision for loan losses to net charge-offs                             |                                              |   | 85.8      | % |              |   | 84.0   | % |  |   | 64.7   | %
|                                           | Provision to net charge-offs (core loan
    portfolio)(7)                |                                              |   | 115.9     | % |              |   | 81.3   | % |  |   | 120.2  | %
|                                          
|Other Selected Items                       |                                                                          |                                              |   |           |   |              |   |        |   |  |   |       
|                                           | Loans serviced(8)                                                        |                                              | $ | 30,944    |   |              | $ | 24,677 |   |  | $ | 29,139 |  
|                                           | Loan production(9)                                                       |                                              | $ | 6,585     |   |              | $ | 4,202  |   |  | $ | 6,580  |  
|                                           | Pipeline of mortgage loans in process                                    |                                              | $ | 6,044     |   |              | $ | 3,008  |   |  | $ | 4,723  |  
|                                           | Loans sold                                                               |                                              | $ | 5,524     |   |              | $ | 4,266  |   |  | $ | 4,378  |  



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|    |                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Dividends declared per common share as a
    percentage of basic earnings per share.                                                                                                                                                                                                                                                                                                                          
|   
|(2) | Defined as operating expenses divided by net
    interest income and other income.                                                                                                                                                                                                                                                                                                                            
|   
|(3) | Average equity divided by net interest income and
    other income.                                                                                                                                                                                                                                                                                                                                           
|   
|(4) | Efficiency ratio multiplied by the capital to net
    revenue ratio.                                                                                                                                                                                                                                                                                                                                          
|   
|(5) | Debt includes deposits.                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(6) | IndyMac Bank, F.S.B. (excludes unencumbered cash
    at the Parent Company available for investment in IndyMac Bank).
    Risk based capital ratio is based on the regulatory standard
    risk weighting. With IndyMacs additional subprime risk
    weightings, the ratios are 13.76%, 15.03% and 14.03% for the
    quarters ended March 31, 2003, March 31, 2002 and
    December 31, 2002, respectively.
|   
|(7) | Represents the total loan portfolio excluding
    amounts of loans from discontinued product lines.                                                                                                                                                                                                                                                                                                           
|   
|(8) | Represents entire servicing portfolio including
    IndyMac owned loans and loans subserviced for others on an
    interim basis.                                                                                                                                                                                                                                                                             
|   
|(9) | Includes newly originated commitments on
    construction loans.                                                                                                                                                                                                                                                                                                                                              

3



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OVERALL RESULTS

IndyMacs overall results for the first
quarter of 2003 were characterized by continued strong mortgage
originations driving net income from mortgage banking
activities. Interest rates declined during the first quarter of
2003 due to geopolitical issues resulting in strong industry
wide mortgage refinance activity. IndyMac increased its
production of mortgage loans by 57% in the first quarter of 2003
over the first quarter of 2002, exceeding the mortgage industry
increase of 49% as published by the Mortgage Bankers
Association of America (MBA). IndyMac sold 95% of
its available mortgage loan production (total production
excluding construction and home equity line of credit
(HELOC) commitments) and increased its inventory of
mortgage loans held for sale during the first quarter of 2003.
In comparison, IndyMac sold 117% of its available mortgage
production in the first quarter of 2002 resulting in a decrease
of mortgage loans held for sale. Offsetting the strong financial
results in our mortgage banking activities, the earnings related
to our servicing-related assets declined due to the increased
levels of prepayment activity which resulted from the record
refinancing of mortgage loans throughout the industry.

IndyMacs operating expenses remained
relatively flat with the fourth quarter of 2002, and up 20% from
the first quarter of 2002. The ratio of operating expense to
loan production of 1.45% reflects significant improvement due to
the scalability of our operations in the strong mortgage
environment relative to the 1.44% ratio during the fourth
quarter of 2002 and the 1.89% ratio during the first quarter of
2002.

Net earnings increased 3%, while earnings per
share (EPS) increased 14% as a result of the
Companys significant share repurchase activities during
2002.

IndyMac delivered another strong quarter
highlighted by record loan production and significant growth in
our pipeline of mortgage loans in process. Our pipeline at the
end of the quarter was more than double the level a year ago.
Interest rates at 40-year lows continued to support a very
strong mortgage origination environment in the first quarter of
this year, while placing our investment portfolio activities
including the servicing-related assets under pressure due to
continued unprecedented refinancing activity. We continued to
increase our portfolio of mortgage loans serviced for others as
we expect this asset to provide substantially stronger returns
when the refinancing boom, now in its third wave, begins to
abate at some point in the future, commented Michael W.
Perry, IndyMacs Chairman and Chief Executive Officer.

We expect the strong mortgage origination
environment to continue throughout the majority of this year. In
fact, the MBA recently concluded in its updated forecast that
industry mortgage originations in 2003 will surpass the record
levels achieved in 2002. As a result of the strong mortgage
market this year, we expect that our EPS for 2003 will be at the
upper end of our previously forecasted range of $2.41 to $2.75.
With our continued focus on customer, product and geographic
expansion across our multiple production channels we believe we
are positioned to outperform our peers as the transition to a
more normal mortgage market occurs, concluded
Mr. Perry.

OUR BUSINESS

IndyMac is structured to achieve synergies among
its operations and enhance customer service. Operating through
its three main segments, IndyMac Mortgage Bank, IndyMac Consumer
Bank and the Investment Portfolio Group, the common denominator
of the Companys business is providing consumers with
single-family residential mortgages through relationships with
each segments core customers via the channels in which
each operates. IndyMac Mortgage Bank is focused on providing
consumers with mortgage products through relationships with the
Companys business customers  mortgage brokers,
mortgage bankers, financial institutions, real estate
professionals and homebuilders. IndyMac Consumer Bank provides
the platform for the mortgage and deposit services that IndyMac
offers directly to consumers. The Investment Portfolio Group
serves as the main link to customers whose mortgages we service.
Through its investments in single-family residential
(SFR) mortgages, mortgage-backed securities
(MBS) and mortgage servicing rights
(MSRs), the Investment Portfolio Group serves a
critical support function for IndyMacs mortgage lending
operations.

4



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##### 



While our segments are structured to achieve
synergies with our varying customer base and marketing
strategies, our operating activities primarily consist of two
broad categories: Mortgage banking activities and Investing
activities. Both of these activities are performed to varying
degrees by each of our main segments as shown in the table that
follows. Mortgage banking activities are characterized by high
asset turnover (the production and sale of mortgage loans) and
efficient utilization of capital but can be cyclical in nature
depending on interest rates. Revenues generated by mortgage
banking activities include gain on sale of mortgage loans, fee
income and net spread (interest) income during the period loans
are held pending sale. Investing activities tend to provide a
source of revenues which is generally counter-cyclical to
mortgage banking revenues, comprised primarily of net interest
income and servicing fees. IndyMac is strategically focused on
increasing the relative size of its portfolios of mortgage loans
and HELOC loans held for investment and mortgage servicing to
achieve greater balance between its mortgage banking activities
and its core investing activities. Over the long-term, we
believe that our investing activities will provide a more stable
source of core income. In addition to its revenue contribution,
the Investment Portfolio Group performs the mortgage servicing
function. This creates an added opportunity to recapture current
customers when the interest rate environment makes it attractive
for them to refinance. Servicing customers can also be
cross-marketed with other Company products.

The following table summarizes the Companys
financial results for the first three months of 2003,
illustrating the revenues earned in its mortgage banking
activities and investing activities by each of its divisions.
The profitability of each operating segment is measured on a
fully-leveraged basis after allocating capital based on
regulatory capital rules. The Company uses a match-funded
transfer pricing system to allocate net interest income to the
operating segments. Each operating segment is allocated funding
with maturities and interest rates matched with the expected
lives, repricing frequencies and financing liquidities of the
segments assets. Deposits receive a funding credit using a
similar methodology. The difference between these allocations
and the Companys actual net interest income and capital
levels resulting from centralized management of funding costs is
reported in the Treasury unit.

During the first quarter of 2003, the Treasury
unit reported net interest expense of $10.7 million
compared with $18.1 million in the first quarter of last
year. These amounts include the interest expense related to the
Trust Preferred Securities, which is not allocated to the
business units. Additionally, the net expense in Treasury
reflects fixed rate liabilities assumed in prior years with
maturities longer than the related assets and the subsequent
decline in net interest income as interest rates fell. As these
liabilities continue to mature the Company expects the loss in
Treasury to decline further.

Corporate overhead costs related to managing the
Company as a whole are not allocated to the operating segments.

5



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|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |        |        |        |        | 
|--------------------------------------- | ------------------ | ----------------------------------- | ------------------- | ---------- | ------ | ------ | ------- | ----- | --- | ----- | --------- | ----- | ----- | ------ | ------- | ----- | ----- | ----- | --------- | ------ | ------ | ------ | ------ | 
|                                        |                    |                                    
|                                        |                    | Relationship Businesses           
|                                        |                    | IndyMac Mortgage Bank              
|                                        |                    |                                    
|                                        |                    |                                     |                     |           
|                                        |                    | B2B                                 |                     | B2R        |        | HCL    |         | HBD   |     | Total
|                                        |                    |                                     |                     |            |        |        |         |       |     |      
|                                        |                    |                                    
|                                        |                    | $ in thousands (except Average FTE)
|Operating Results                       |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Mortgage Banking Activities             |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Net interest income                     |                    | $                                   | 22,462              |            |        | $      | 949     |       |     | $     | 2,905     |       |       | $      | 433     |       |       | $     | 26,749    |       
|Gain on sale of loans                   |                    |                                     | 53,627              |            |        |        | 2,697   |       |     |       | 5,480     |       |       |        | 1,299   |       |       |       | 63,103    |       
|Other income                            |                    |                                     | 7,679               |            |        |        | 558     |       |     |       | 888       |       |       |        | 170     |       |       |       | 9,295     |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        | Net revenues       |                                     |                     | 83,768     |        |        |         | 4,204 |     |       |           | 9,273 |       |        |         | 1,902 |       |       |           | 99,147 |       
|                                        | Operating expenses |                                     |                     | 27,148     |        |        |         | 4,302 |     |       |           | 358   |       |        |         | 983   |       |       |           | 32,791 |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        |                    | Pretax income                       |                     |            | 56,620 |        |         |       | (98 | )     |           |       | 8,915 |        |         |       | 919   |       |           |        | 66,356 |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Investing Activities                    |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Net interest income                     |                    |                                     |                    |            |        |        |        |       |     |       | 9,057     |       |       |        | 7,945   |       |       |       | 17,002    |       
|Provision for loan losses               |                    |                                     |                    |            |        |        |        |       |     |       | (809      | )     |       |        | (312    | )     |       |       | (1,121    | )     
|Service fee income                      |                    |                                     |                    |            |        |        |        |       |     |       |          |       |       |        |        |       |       |       |          |       
|Gain on sale of securities              |                    |                                     |                    |            |        |        |        |       |     |       |          |       |       |        |        |       |       |       |          |       
|Other income                            |                    |                                     |                    |            |        |        |        |       |     |       | 1,311     |       |       |        | 160     |       |       |       | 1,471     |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        | Net revenues       |                                     |                     |           |        |        |         |      |     |       |           | 9,559 |       |        |         | 7,793 |       |       |           | 17,352 |       
|                                        | Operating expenses |                                     |                     |           |        |        |         |      |     |       |           | 6,171 |       |        |         | 2,277 |       |       |           | 8,448  |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        |                    | Pretax income                       |                     |            |       |        |         |       |    |       |           |       | 3,388 |        |         |       | 5,516 |       |           |        | 8,904  |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Financing and Other Activities          |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Net interest income                     |                    |                                     |                    |            |        |        |        |       |     |       |          |       |       |        |        |       |       |       |          |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        | Net revenues       |                                     |                     |           |        |        |         |      |     |       |           |      |       |        |         |      |       |       |           |       |       
|                                        | Operating expenses |                                     |                     |           |        |        |         |      |     |       |           |      |       |        |         |      |       |       |           |       |       
|                                        |                    | Pretax income                       |                     |            |       |        |         |       |    |       |           |       |      |        |         |       |      |       |           |        |       |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        |                    |                                     | Total pretax income |            |        | 56,620 |         |       |     | (98   | )         |       |       | 12,303 |         |       |       | 6,435 |           |        |        | 75,260 |       
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|                                        |                    |                                     |                     | Net income |        | $      | 34,254  |       |     | $     | (59       | )     |       | $      | 7,443   |       |       | $     | 3,893     |        |        | $      | 45,531 | 
|                                        |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Ratios                                  |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Percentage of assets                    |                    |                                     | 20                  | %          |        |        | 1       | %     |     |       | 11        | %     |       |        | 7       | %     |       |       | 39        | %     
|Percentage of total revenue             |                    |                                     | 52                  | %          |        |        | 2       | %     |     |       | 11        | %     |       |        | 6       | %     |       |       | 71        | %     
|Percentage of pretax income             |                    |                                     | 63                  | %          |        |        | 0       | %     |     |       | 14        | %     |       |        | 7       | %     |       |       | 83        | %     
|Balance Sheet Data                      |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Average earning assets                  |                    | $                                   | 1,875,716           |            |        | $      | 93,770  |       |     | $     | 1,106,245 |       |       | $      | 688,115 |       |       | $     | 3,763,846 |       
|Average total assets                    |                    | $                                   | 1,957,601           |            |        | $      | 96,153  |       |     | $     | 1,116,359 |       |       | $      | 671,755 |       |       | $     | 3,841,868 |       
|Allocated capital                       |                    | $                                   | 122,985             |            |        | $      | 5,606   |       |     | $     | 60,294    |       |       | $      | 70,064  |       |       | $     | 258,949   |       
|Allocated capital/ total average assets |                    |                                     | 6.28                | %          |        |        | 5.83    | %     |     |       | 5.40      | %     |       |        | 10.43   | %     |       |       | 6.74      | %     
|Loans Produced                          |                    | $                                   | 3,935,377           |            |        | $      | 242,358 |       |     | $     | 680,370   |       |       | $      | 219,496 |       |       | $     | 5,077,601 |       
|Percentage purchased                    |                    |                                     | 24                  | %          |        |        | 29      | %     |     |       | 95        | %     |       |        | 75      | %     |       |       | 36        | %     
|Percentage cashout refinanced           |                    |                                     | 45                  | %          |        |        | 35      | %     |     |       | 0         | %     |       |        | 12      | %     |       |       | 37        | %     
|Percentage rate and term refinanced     |                    |                                     | 30                  | %          |        |        | 36      | %     |     |       | 5         | %     |       |        | 13      | %     |       |       | 26        | %     
|Performance Ratios                      |                    |                                     |                     |            |        |        |         |       |     |       |           |       |       |        |         |       |       |       |           |       
|Return on equity                        |                    |                                     | 115                 | %          |        |        | (17     | )%    |     |       | 50        | %     |       |        | 23      | %     |       |       | 72        | %     
|Return on assets                        |                    |                                     | 7                   | %          |        |        | (1      | )%    |     |       | 3         | %     |       |        | 2       | %     |       |       | 5         | %     
|Net interest margin                     |                    |                                     | 5                   | %          |        |        | 4       | %     |     |       | 4         | %     |       |        | 5       | %     |       |       | 5         | %     
|Efficiency ratio                        |                    |                                     | 32                  | %          |        |        | 110     | %     |     |       | 34        | %     |       |        | 33      | %     |       |       | 35        | %     
|Capital adjusted efficiency ratio       |                    |                                     | 12                  | %          |        |        | 40      | %     |     |       | 27        | %     |       |        | 57      | %     |       |       | 19        | %     
|Average FTE                             |                    |                                     | 1,073               |            |        |        | 145     |       |     |       | 211       |       |       |        | 90      |       |       |       | 1,519     |       

6



---



##### 





| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  | ----------------------------------- | --------- | ---------- |  | ----------- | ------- | ----- |  | --------- | ------ | ----- |  | -------- | --------- | -------- |  | ------------ | --------- | ----- |  | - | ------- | -- |  | - | --------- | - |  | - | ------- | - |  | - | ------ | - |  | - | ---------- | -
| |  |                                     |           | Investment |  |             |         |       |  |           |        |       |  |         
| |  | Consumer Direct Businesses         |           | Portfolio  |  | Treasury    |         |       |  |           |        |       |  |         
| |  | IndyMac Consumer Bank               |           | Group      |  | Group       |         |       |  |           |        |       |  |         
| |  |                                     |           |            |  |             |         |       |  | Corporate |        |       |  |         
| |  | B2C                                 |           | HELOC      |  | Retail Bank |         | Total |  | Total     |        | Total |  | Subtotal |           | Overhead |  | Eliminations |           | Total
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |      
| |  |                                    
| |  | $ in thousands (except Average FTE)
| |  | $                                   | 4,969     |            |  | $           |        |       |  | $         | 289    |       |  | $        | 5,258     |          |  | $            |          |       |  | $ |        |    |  | $ | 32,007    |   |  | $ |        |   |  | $ |       |   |  | $ | 32,007     |  
| |  |                                     | 20,573    |            |  |             |        |       |  |           | 925    |       |  |          | 21,498    |          |  |              | 7,454     |       |  |   |        |    |  |   | 92,055    |   |  |   |        |   |  |   | (8,271 | ) |  |   | 83,784     |  
| |  |                                     | 5,259     |            |  |             |        |       |  |           | 237    |       |  |          | 5,496     |          |  |              |          |       |  |   |        |    |  |   | 14,791    |   |  |   |        |   |  |   |       |   |  |   | 14,791     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     | 30,801    |            |  |             |        |       |  |           | 1,451  |       |  |          | 32,252    |          |  |              | 7,454     |       |  |   |        |    |  |   | 138,853   |   |  |   |        |   |  |   | (8,271 | ) |  |   | 130,582    |  
| |  |                                     | 14,248    |            |  |             |        |       |  |           | 750    |       |  |          | 14,998    |          |  |              |          |       |  |   |        |    |  |   | 47,789    |   |  |   |        |   |  |   |       |   |  |   | 47,789     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     | 16,553    |            |  |             |        |       |  |           | 701    |       |  |          | 17,254    |          |  |              | 7,454     |       |  |   |        |    |  |   | 91,064    |   |  |   |        |   |  |   | (8,271 | ) |  |   | 83,793     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             | 2,530   |       |  |           | (40    | )     |  |          | 2,490     |          |  |              | 19,085    |       |  |   |        |    |  |   | 38,577    |   |  |   |        |   |  |   | 673    |   |  |   | 39,250     |  
| |  |                                     |          |            |  |             | (446    | )     |  |           |       |       |  |          | (446      | )        |  |              | (1,533    | )     |  |   |        |    |  |   | (3,100    | ) |  |   |        |   |  |   |       |   |  |   | (3,100     | )
| |  |                                     |          |            |  |             |        |       |  |           |       |       |  |          |          |          |  |              | 1,475     |       |  |   |        |    |  |   | 1,475     |   |  |   |        |   |  |   | 908    |   |  |   | 2,383      |  
| |  |                                     |          |            |  |             |        |       |  |           |       |       |  |          |          |          |  |              | (6,910    | )     |  |   |        |    |  |   | (6,910    | ) |  |   |        |   |  |   |       |   |  |   | (6,910     | )
| |  |                                     |          |            |  |             | 301     |       |  |           | 443    |       |  |          | 744       |          |  |              | 721       |       |  |   |         |    |  |   | 2,936     |   |  |   |        |   |  |   |       |   |  |   | 2,936      |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             | 2,385   |       |  |           | 403    |       |  |          | 2,788     |          |  |              | 12,838    |       |  |   |        |    |  |   | 32,978    |   |  |   |        |   |  |   | 1,581  |   |  |   | 34,559     |  
| |  |                                     |          |            |  |             | 1,325   |       |  |           | 5,111  |       |  |          | 6,436     |          |  |              | 9,548     |       |  |   |        |    |  |   | 24,432    |   |  |   |        |   |  |   |       |   |  |   | 24,432     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             | 1,060   |       |  |           | (4,708 | )     |  |          | (3,648    | )        |  |              | 3,290     |       |  |   |        |    |  |   | 8,546     |   |  |   |        |   |  |   | 1,581  |   |  |   | 10,127     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             |        |       |  |           | 2,663  |       |  |          | 2,663     |          |  |              |          |       |  |   | (10,712 | )  |  |   | (8,049    | ) |  |   | (183    | ) |  |   |       |   |  |   | (8,232     | )
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             |        |       |  |           | 2,663  |       |  |          | 2,663     |          |  |              |          |       |  |   | (10,712 | )  |  |   | (8,049    | ) |  |   | (183    | ) |  |   |       |   |  |   | (8,232     | )
| |  |                                     |          |            |  |             |        |       |  |           |       |       |  |          |          |          |  |              |          |       |  |   | 735     |    |  |   | 735       |   |  |   | 22,933  |   |  |   |       |   |  |   | 23,668     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     |          |            |  |             |        |       |  |           | 2,663  |       |  |          | 2,663     |          |  |              |          |       |  |   | (11,447 | )  |  |   |          |   |  |   | (23,116 | ) |  |   |       |   |  |   | (31,900    | )
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     | 16,553    |            |  |             | 1,060   |       |  |           | (1,344 | )     |  |          | 16,269    |          |  |              | 10,744    |       |  |   | (11,447 | )  |  |   | 90,826    |   |  |   | (23,116 | ) |  |   | (6,690 | ) |  |   | 61,020     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  | $                                   | 10,015    |            |  | $           | 641     |       |  | $         | (813   | )     |  | $        | 9,843     |          |  | $            | 6,499     |       |  | $ | (6,925  | )  |  | $ | 54,948    |   |  | $ | (13,985 | ) |  | $ | (4,046 | ) |  | $ | 36,917     |  
| |  |                                     |           |            |  |             |         |       |  |           |        |       |  |          |           |          |  |              |           |       |  |   |         |    |  |   |           |   |  |   |         |   |  |   |        |   |  |   |            |  
| |  |                                     | 5         | %          |  |             | 4       | %     |  |           | 1      | %     |  |          | 9         | %        |  |              | 50        | %     |  |   | 2       | %  |  |   | 100       | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 100        | %
| |  |                                     | 19        | %          |  |             | 1       | %     |  |           | 3      | %     |  |          | 23        | %        |  |              | 12        | %     |  |   | (7      | )% |  |   | 113       | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 100        | %
| |  |                                     | 19        | %          |  |             | 1       | %     |  |           | (2     | )%    |  |          | 17        | %        |  |              | 12        | %     |  |   | (13     | )% |  |   | 125       | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 125        | %
| |  | $                                   | 486,543   |            |  | $           | 344,309 |       |  | $         | 30,170 |       |  | $        | 861,022   |          |  | $            | 4,384,989 |       |  | $ | 152,730 |    |  | $ | 9,162,587 |   |  | $ | (20,328 | ) |  |   |       |   |  | $ | 9,142,259  |  
| |  | $                                   | 501,822   |            |  | $           | 350,142 |       |  | $         | 58,451 |       |  | $        | 910,415   |          |  | $            | 5,002,602 |       |  | $ | 154,376 |    |  | $ | 9,909,261 |   |  | $ | 127,641 |   |  |   |       |   |  | $ | 10,036,902 |  
| |  | $                                   | 31,612    |            |  | $           | 35,278  |       |  | $         | 7,566  |       |  | $        | 74,456    |          |  | $            | 350,758   |       |  | $ | 7,719   |    |  | $ | 691,882   |   |  | $ | 178,341 |   |  |   |       |   |  | $ | 870,223    |  
| |  |                                     | 6.30      | %          |  |             | 10.08   | %     |  |           | 12.94  | %     |  |          | 8.18      | %        |  |              | 7.01      | %     |  |   | 5.00    | %  |  |   | 6.98      | % |  |   | 139.72  | % |  |   |       |   |  |   | 8.67       | %
| |  | $                                   | 1,254,102 |            |  | $           | 179,669 | (1)   |  | $         | 73,600 |       |  | $        | 1,507,371 |          |  |              |          |       |  |   |        |    |  | $ | 6,584,972 |   |  |   |        |   |  |   |       |   |  | $ | 6,584,972  |  
| |  |                                     | 4         | %          |  |             | N/A     |       |  |           | 15     | %     |  |          | 5         | %        |  |              | N/A       |       |  |   | N/A     |    |  |   | N/A       |   |  |   | N/A     |   |  |   |        |   |  |   | 30         | %
| |  |                                     | 37        | %          |  |             | N/A     |       |  |           | 35     | %     |  |          | 37        | %        |  |              | N/A       |       |  |   | N/A     |    |  |   | N/A       |   |  |   | N/A     |   |  |   |        |   |  |   | 37         | %
| |  |                                     | 59        | %          |  |             | N/A     |       |  |           | 50     | %     |  |          | 58        | %        |  |              | N/A       |       |  |   | N/A     |    |  |   | N/A       |   |  |   | N/A     |   |  |   |        |   |  |   | 33         | %
| |  |                                     | 132       | %          |  |             | 4       | %     |  |           | N/A    |       |  |          | 52        | %        |  |              | 8         | %     |  |   | N/A     |    |  |   | 32        | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 17         | %
| |  |                                     | 8         | %          |  |             | 0       | %     |  |           | N/A    |       |  |          | 4         | %        |  |              | 1         | %     |  |   | N/A     |    |  |   | 2         | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 1          | %
| |  |                                     | 4         | %          |  |             | 3       | %     |  |           | N/A    |       |  |          | 5         | %        |  |              | 2         | %     |  |   | N/A     |    |  |   | 3         | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 3          | %
| |  |                                     | 45        | %          |  |             | 46      | %     |  |           | N/A    |       |  |          | 56        | %        |  |              | 44        | %     |  |   | N/A     |    |  |   | 44        | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 60         | %
| |  |                                     | 12        | %          |  |             | 143     | %     |  |           | N/A    |       |  |          | 27        | %        |  |              | 176       | %     |  |   | N/A     |    |  |   | 45        | % |  |   | N/A     |   |  |   | N/A    |   |  |   | 81         | %
| |  |                                     | 529       |            |  |             | 9       |       |  |           | 227    |       |  |          | 765       |          |  |              | 450       |       |  |   | 22      |    |  |   | 2,756     |   |  |   | 529     |   |  |   | N/A    |   |  |   | 3,285      |  

(1)Amount
represents total HELOC loans produced by all business units
during the first quarter of 2003.

7



---



##### 



The following table compares the quarterly detail
segment results of operations:

|                                  |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|--------------------------------- |  | ------------------------------------------ | ------ | --- |  | --- | ---- | --- |  | ----- | ----- | -- |  |  | ----- | -- |  |  | ------ | ---
|                                  |  |                                           
|                                  |  | Relationship Businesses                  
|                                  |  | IndyMac Mortgage Bank                     
|                                  |  |                                           
|                                  |  |                                            |        |    
|                                  |  | B2B                                        |        | B2R |  | HCL |      | HBD |  | Total
|                                  |  |                                            |        |     |  |     |      |     |  |      
|                                  |  |                                           
|                                  |  | (Dollars in thousands, except average FTE)
|Mortgage Banking Activities       |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|Q1 03  Pretax income             |  |                                            | 56,620 |     |  |     | (98  | )   |  |       | 8,915 |    |  |  | 919   |    |  |  | 66,356 | (1)
|Q4 02  Pretax income             |  |                                            | 49,989 |     |  |     | 435  |     |  |       | 7,213 |    |  |  | 399   |    |  |  | 58,036 | (1)
|Annualized Variance Percent       |  |                                            | 53     | %   |  |     | 490  | %   |  |       | 94    | %  |  |  | 521   | %  |  |  | 57     | %  
|Q1 02  Pretax income             |  |                                            | 57,786 |     |  |     | (122 | )   |  |       | 5,604 |    |  |  |      |    |  |  | 63,268 | (1)
|Variance Percent                  |  |                                            | (2     | )%  |  |     | 20   | %   |  |       | 59    | %  |  |  | NM    |    |  |  | 5      | %  
|Investing Activities              |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|Q1 03  Pretax income             |  |                                            |       |     |  |     |     |     |  |       | 3,388 |    |  |  | 5,516 |    |  |  | 8,904  | (1)
|Q4 02  Pretax income             |  |                                            |       |     |  |     |     |     |  |       | 2,055 |    |  |  | 4,883 |    |  |  | 6,938  | (1)
|Annualized Variance Percent       |  |                                            | NM     |     |  |     | NM   |     |  |       | 259   | %  |  |  | 52    | %  |  |  | 113    | %  
|Q1 02  Pretax income             |  |                                            |       |     |  |     |     |     |  |       | 7,699 |    |  |  | 7,390 |    |  |  | 15,089 | (1)
|Variance Percent                  |  |                                            | NM     |     |  |     | NM   |     |  |       | (56   | )% |  |  | (25   | )% |  |  | (41)   | %  
|Financing and Other Activities    |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|Q1 03  Pretax income             |  |                                            |       |     |  |     |     |     |  |       |      |    |  |  |      |    |  |  |       |    
|Q4 02  Pretax income             |  |                                            |       |     |  |     |     |     |  |       |      |    |  |  |      |    |  |  |       |    
|Q1 02  Pretax income             |  |                                            |       |     |  |     |     |     |  |       |      |    |  |  |      |    |  |  |       |    
|Net Income                        |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|Q1 03  Net Income                |  |                                            | 34,254 |     |  |     | (59  | )   |  |       | 7,443 |    |  |  | 3,893 |    |  |  | 45,531 |    
|Q4 02  Net Income                |  |                                            | 32,502 |     |  |     | 305  |     |  |       | 6,056 |    |  |  | 3,383 |    |  |  | 42,246 |    
|Annualized Variance Percent       |  |                                            | 22     | %   |  |     | (477 | )%  |  |       | 92    | %  |  |  | 60    | %  |  |  | 31     | %  
|Q1 02  Net Income                |  |                                            | 33,776 |     |  |     | (71  | )   |  |       | 7,776 |    |  |  | 4,319 |    |  |  | 45,800 |    
|Variance Percent                  |  |                                            | 1      | %   |  |     | (17  | )%  |  |       | (4    | )% |  |  | (10   | )% |  |  | (1)    | %  
|Performance Ratios                |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|Q1 03                             |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|ROE                               |  |                                            | 115    | %   |  |     | (17  | )%  |  |       | 50    | %  |  |  | 23    | %  |  |  | 72     | %  
|ROA                               |  |                                            | 7      | %   |  |     | (1   | )%  |  |       | 3     | %  |  |  | 2     | %  |  |  | 5      | %  
|NIM                               |  |                                            | 5      | %   |  |     | 4    | %   |  |       | 4     | %  |  |  | 5     | %  |  |  | 5      | %  
|Efficiency ratio                  |  |                                            | 32     | %   |  |     | 110  | %   |  |       | 34    | %  |  |  | 33    | %  |  |  | 35     | %  
|Capital adjusted efficiency ratio |  |                                            | 12     | %   |  |     | 40   | %   |  |       | 27    | %  |  |  | 57    | %  |  |  | 19     | %  
|Average FTE                       |  |                                            | 1,073  |     |  |     | 145  |     |  |       | 211   |    |  |  | 90    |    |  |  | 1,519  |    
|Q4 02                             |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|ROE                               |  |                                            | 133    | %   |  |     | 25   | %   |  |       | 45    | %  |  |  | 17    | %  |  |  | 72     | %  
|ROA                               |  |                                            | 7      | %   |  |     | 1    | %   |  |       | 2     | %  |  |  | 2     | %  |  |  | 5      | %  
|NIM                               |  |                                            | 4      | %   |  |     | 4    | %   |  |       | 4     | %  |  |  | 5     | %  |  |  | 4      | %  
|Efficiency ratio                  |  |                                            | 37     | %   |  |     | 88   | %   |  |       | 39    | %  |  |  | 37    | %  |  |  | 39     | %  
|Capital adjusted efficiency ratio |  |                                            | 11     | %   |  |     | 29   | %   |  |       | 31    | %  |  |  | 73    | %  |  |  | 21     | %  
|Average FTE                       |  |                                            | 1,076  |     |  |     | 124  |     |  |       | 172   |    |  |  | 79    |    |  |  | 1,451  |    
|Q1 02                             |  |                                            |        |     |  |     |      |     |  |       |       |    |  |  |       |    |  |  |        |    
|ROE                               |  |                                            | 155    | %   |  |     | (12  | )%  |  |       | 57    | %  |  |  | 19    | %  |  |  | 78     | %  
|ROA                               |  |                                            | 9      | %   |  |     | (1   | )%  |  |       | 3     | %  |  |  | 2     | %  |  |  | 5      | %  
|NIM                               |  |                                            | 5      | %   |  |     | 5    | %   |  |       | 5     | %  |  |  | 5     | %  |  |  | 5      | %  
|Efficiency ratio                  |  |                                            | 32     | %   |  |     | 105  | %   |  |       | 23    | %  |  |  | 26    | %  |  |  | 32     | %  
|Capital adjusted efficiency ratio |  |                                            | 8      | %   |  |     | 26   | %   |  |       | 18    | %  |  |  | 59    | %  |  |  | 16     | %  
|Average FTE                       |  |                                            | 1,066  |     |  |     | 94   |     |  |       | 170   |    |  |  | 84    |    |  |  | 1,414  |    



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The Mortgage Bank segments pretax income,
    from both mortgage banking and investing activities, grew by
    $10.3 million, or 16%, during the first quarter of 2003
    versus the fourth quarter of last year. This increase was
    primarily related to higher net interest income on loans held
    for sale as average balances and interest rates increased. Gain
    on sale revenue also improved, consistent with the larger volume
    of loans sold. Compared with the first three months of 2002, the
    Mortgage Bank segments pretax income declined
    $3.1 million primarily as a result of a reduction in loans
    sold as a percentage of mortgage production and lower net
    interest income related to the builder construction portfolio.
    IndyMac sold 95% of its available mortgage production in the
    first quarter of 2003 as compared to 117% for the first quarter
    of 2002.

8



---



##### 





| |  |                                     |        |              |  |          |       |              |  |          |        |             |  |              |         |          |  |              |        |       |  |  |         |    |  |  |          |   |  |  |         |   |  |  |         |   |  |  |         |   
| |  | ----------------------------------- | ------ | ------------ |  | -------- | ----- | ------------ |  | -------- | ------ | ----------- |  | ------------ | ------- | -------- |  | ------------ | ------ | ----- |  |  | ------- | -- |  |  | -------- | - |  |  | ------- | - |  |  | ------- | - |  |  | ------- | --
| |  |                                     |        |              |  |          |       |              |  |          |        |             |  |             
| |  | Consumer Direct Businesses         |        |              |  |          |       |              |  |          |        |             |  |             
| |  | IndyMac Consumer Bank               |        |              |  |          |       | Total Before |  |          |        |             |  |             
| |  |                                     |        | Investment   |  |          |       | Corporate    |  |          |        |             |  |             
| |  |                                     |        | Retail Bank/ |  |          |       | Portfolio    |  | Treasury |        | Support and |  | Corporate    |         |          |  |             
| |  | B2C                                 |        | HELOC        |  | Deposits |       | Total        |  | Group    |        | Group       |  | Eliminations |         | Overhead |  | Eliminations |        | Total
| |  |                                     |        |              |  |          |       |              |  |          |        |             |  |              |         |          |  |              |        |      
| |  |                                    
| |  | $ in thousands (except Average FTE)
| |  |                                     | 16,553 |              |  |          |      |              |  |          | 701    |             |  |              | 17,254  | (2)      |  |              | 7,454  | (3)   |  |  |        |    |  |  | 91,064   |   |  |  |        |   |  |  | (8,271) |   |  |  | 82,793  |   
| |  |                                     | 15,852 |              |  |          |      |              |  |          | 509    |             |  |              | 16,361  | (2)      |  |              | 1,021  | (3)   |  |  |        |    |  |  | 75,418   |   |  |  |        |   |  |  | (5,540) |   |  |  | 69,878  |   
| |  |                                     | 18     | %            |  |          | NM    |              |  |          | 151    | %           |  |              | 22      | %        |  |              | 2,520  | %     |  |  |        |    |  |  | 83       | % |  |  |        |   |  |  |        |   |  |  | 74      | % 
| |  |                                     | 9,409  |              |  |          |      |              |  |          | 788    |             |  |              | 10,197  | (2)      |  |              | 1,525  | (3)   |  |  |        |    |  |  | 74,990   |   |  |  |        |   |  |  | (2,562) |   |  |  | 72,428  |   
| |  |                                     | 76     | %            |  |          | NM    |              |  |          | (11    | )%          |  |              | 69      | %        |  |              | 389    | %     |  |  |        |    |  |  | 21       | % |  |  |        |   |  |  |         |   |  |  | 14      | % 
| |  |                                     |       |              |  |          | 1,060 |              |  |          | (4,708 | )           |  |              | (3,648) | (2)      |  |              | 3,290  | (3)   |  |  |        |    |  |  | 8,546    |   |  |  |        |   |  |  | 1,581   |   |  |  | 10,127  |   
| |  |                                     |       |              |  |          | 1,728 |              |  |          | (4,900 | )           |  |              | (3,172) | (2)      |  |              | 3,630  | (3)   |  |  |        |    |  |  | 7,396    |   |  |  |        |   |  |  | 1,667   |   |  |  | 9,063   |   
| |  |                                     | NM     |              |  |          | (155  | )%           |  |          | (16    | )%          |  |              | 60      | %        |  |              | (37)   | %     |  |  |        |    |  |  | 62       | % |  |  |        |   |  |  | (21)    | % |  |  | 47      | % 
| |  |                                     |       |              |  |          | 243   |              |  |          | (4,981 | )           |  |              | (4,738) | (2)      |  |              | 10,917 | (3)   |  |  |        |    |  |  | 21,268   |   |  |  |        |   |  |  | 781     |   |  |  | 22,049  |   
| |  |                                     | NM     |              |  |          | 336   | %            |  |          | (5     | )%          |  |              | (23)    | %        |  |              | (70)   | %     |  |  |         |    |  |  | (60)     | % |  |  |        |   |  |  | 102     | % |  |  | (54     | )%
| |  |                                     |       |              |  |          |      |              |  |          | 2,663  |             |  |              | 2,663   | (2)      |  |              |       |       |  |  | (11,447 | )  |  |  | (8,784)  |   |  |  | (23,116 | ) |  |  |        |   |  |  | (31,900 | ) 
| |  |                                     |       |              |  |          |      |              |  |          | 2,895  |             |  |              | 2,895   | (2)      |  |              |       |       |  |  | (11,854 | )  |  |  | (8,959)  |   |  |  | (20,657 | ) |  |  |        |   |  |  | (29,616 | ) 
| |  |                                     |       |              |  |          |      |              |  |          | 4,141  |             |  |              | 4,141   | (2)      |  |              |       |       |  |  | (19,104 | )  |  |  | (14,963) |   |  |  | (17,890 | ) |  |  |        |   |  |  | (32,853 | ) 
| |  |                                     | 10,015 |              |  |          | 641   |              |  |          | (813   | )           |  |              | 9,843   |          |  |              | 6,499  |       |  |  | (6,925  | )  |  |  | 54,948   |   |  |  | (13,985 | ) |  |  | (4,046) |   |  |  | 36,917  |   
| |  |                                     | 10,277 |              |  |          | 1,116 |              |  |          | (973   | )           |  |              | 10,420  |          |  |              | 2,967  |       |  |  | (7,113  | )  |  |  | 48,520   |   |  |  | (10,599 | ) |  |  | (2,324) |   |  |  | 35,597  |   
| |  |                                     | (10    | )%           |  |          | (170  | )%           |  |          | (66    | )%          |  |              | (22)    | %        |  |              | 476    | %     |  |  | (11     | )% |  |  | 53       | % |  |  | 128     | % |  |  | 296     | % |  |  | 15      | % 
| |  |                                     | 5,499  |              |  |          | 142   |              |  |          | (31    | )           |  |              | 5,610   |          |  |              | 7,273  |       |  |  | (11,166 | )  |  |  | 47,517   |   |  |  | (10,457 | ) |  |  | (1,041) |   |  |  | 36,019  |   
| |  |                                     | 82     | %            |  |          | 351   | %            |  |          | 2,523  | %           |  |              | 75      | %        |  |              | (11)   | %     |  |  | (38     | )% |  |  | 16       | % |  |  | 34      | % |  |  | 289     | % |  |  | 2       | % 
| |  |                                     | 132    | %            |  |          | 4     | %            |  |          |       |             |  |              | 52      | %        |  |              | 8      | %     |  |  |        |    |  |  | 32       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 17      | % 
| |  |                                     | 8      | %            |  |          | 0     | %            |  |          |       |             |  |              | 4       | %        |  |              | 1      | %     |  |  |        |    |  |  | 2        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 1       | % 
| |  |                                     | 4      | %            |  |          | 3     | %            |  |          |       |             |  |              | 5       | %        |  |              | 2      | %     |  |  |        |    |  |  | 3        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 3       | % 
| |  |                                     | 45     | %            |  |          | 46    | %            |  |          |       |             |  |              | 56      | %        |  |              | 44     | %     |  |  |        |    |  |  | 44       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 60      | % 
| |  |                                     | 12     | %            |  |          | 143   | %            |  |          |       |             |  |              | 27      | %        |  |              | 176    | %     |  |  |        |    |  |  | 45       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 81      | % 
| |  |                                     | 529    |              |  |          | 9     |              |  |          | 227    |             |  |              | 765     |          |  |              | 450    |       |  |  | 22      |    |  |  | 2,756    |   |  |  | 529     |   |  |  | N/A     |   |  |  | 3,285   |   
| |  |                                     | 127    | %            |  |          | 14    | %            |  |          |       |             |  |              | 58      | %        |  |              | 4      | %     |  |  |        |    |  |  | 31       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 17      | % 
| |  |                                     | 8      | %            |  |          | 2     | %            |  |          |       |             |  |              | 5       | %        |  |              | 0      | %     |  |  |        |    |  |  | 2        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 2       | % 
| |  |                                     | 4      | %            |  |          | 4     | %            |  |          |       |             |  |              | 5       | %        |  |              | 2      | %     |  |  |        |    |  |  | 3        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 3       | % 
| |  |                                     | 45     | %            |  |          | 35    | %            |  |          |       |             |  |              | 55      | %        |  |              | 57     | %     |  |  |        |    |  |  | 48       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 63      | % 
| |  |                                     | 13     | %            |  |          | 105   | %            |  |          |       |             |  |              | 27      | %        |  |              | 221    | %     |  |  |        |    |  |  | 49       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 90      | % 
| |  |                                     | 483    |              |  |          | 7     |              |  |          | 198    |             |  |              | 688     |          |  |              | 441    |       |  |  | 27      |    |  |  | 2,607    |   |  |  | 542     |   |  |  | N/A     |   |  |  | 3,149   |   
| |  |                                     | 125    | %            |  |          | 5     | %            |  |          |       |             |  |              | 62      | %        |  |              | 13     | %     |  |  |        |    |  |  | 39       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 17      | % 
| |  |                                     | 7      | %            |  |          | 1     | %            |  |          |       |             |  |              | 5       | %        |  |              | 1      | %     |  |  |        |    |  |  | 3        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 2       | % 
| |  |                                     | 5      | %            |  |          | 3     | %            |  |          |       |             |  |              | 8       | %        |  |              | 3      | %     |  |  |        |    |  |  | 3        | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 3       | % 
| |  |                                     | 54     | %            |  |          | 32    | %            |  |          |       |             |  |              | 63      | %        |  |              | 35     | %     |  |  |        |    |  |  | 42       | % |  |  | N/A     |   |  |  | N/A     |   |  |  | 55      | % 
| |  |                                     | 12     | %            |  |          | 126   | %            |  |          |       |             |  |              | 22      | %        |  |              | 80     | %     |  |  |        |    |  |  | 36       | % |  |  |         |   |  |  |         |   |  |  | 81      | % 
| |  |                                     | 370    |              |  |          | 4     |              |  |          | 207    |             |  |              | 581     |          |  |              | 404    |       |  |  | 29      |    |  |  | 2,428    |   |  |  | 418     |   |  |  | N/A     |   |  |  | 2,846   |   



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The Consumer Bank segments pretax income,
    from mortgage banking, investing and financing activities, was
    essentially flat compared with the fourth quarter of 2002, and
    was up $6.7 million, or 70%, versus last years first
    quarter. The increase from a year ago was largely due to the
    higher level of production in the current refinance cycle.                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|(3) | The Investment Portfolio segments pretax
    income, from both mortgage banking and investing activities,
    increased $6.1 million compared with the fourth quarter of
    2002. Gains from sales of loans acquired by exercising clean-up
    call options primarily drove this increase. The investing
    activities in this segment were unchanged versus the fourth
    quarter of last year as lower portfolio returns were offset by
    higher average balances. Compared with the year ago first
    quarter, the Investment Portfolio segments pretax income
    declined $1.7 million. This decrease reflects a significant
    decline in service fee income caused by the high prepayment
    activity in the current quarter, partially offset by the
    previously described gains on loan sales.

9



---



##### 



MORTGAGE BANKING ACTIVITIES

Loan Production

During the first three months of 2003, the
Company produced $6.6 billion of loans, which was a 57%
increase over the $4.2 billion of loans produced during the
first three months of 2002. Total production by loan type was as
follows:

|                                     |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |     |    |  
|------------------------------------ | -------------------- | ---------------------------- | ----- | --------- | ----- | -------- | ----- | ------------ | ----- | -------- | --- | --- | -- | - | ----- | ----- | ----- |  | --- | --- | -- | -
|                                     |                      |                             
|                                     |                      | Three Months Ended          
|                                     |                      |                             
|                                     |                      | March 31,                    |       | March 31, |       | Variance |       | December 31, |       | Variance
|                                     |                      | 2003                         |       | 2002      |       | Percent  |       | 2002         |       | Percent 
|                                     |                      |                              |       |           |       |          |       |              |       |         
|                                     |                      |                             
|                                     |                      | (Dollars in millions)       
|Volume by product                    |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |    
|Prime(1)                             |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |    
|                                     | Agency conforming    |                              | $     | 1,418     |       |          | $     | 970          |       |          |     | 46  | %  |   | $     | 1,425 |       |  |     | 0   | % 
|                                     | Alt-A                |                              |       | 3,017     |       |          |       | 1,224        |       |          |     | 146 | %  |   |       | 2,915 |       |  |     | 3   | % 
|                                     | Jumbo                |                              |       | 1,013     |       |          |       | 1,064        |       |          |     | (5  | )% |   |       | 1,243 |       |  |     | (19 | )%
|                                     | Government  FHA/ VA |                              |       | 3         |       |          |       | 60           |       |          |     | NM  |    |   |       | 4     |       |  |     | (25 | )%
|Subprime(1)                          |                      |                              | 384   |           |       |          | 334   |              |       |          | 15  | %   |    |   | 279   |       |       |  | 38  | %  
|Home equity line of credit(2)        |                      |                              | 180   |           |       |          | 57    |              |       |          | 216 | %   |    |   | 142   |       |       |  | 27  | %  
|Consumer construction(2)             |                      |                              | 440   |           |       |          | 350   |              |       |          | 26  | %   |    |   | 402   |       |       |  | 9   | %  
|                                     |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |    
|                                     |                      | Subtotal mortgage production |       |           | 6,455 |          |       |              | 4,059 |          |     |     | 59 | % |       |       | 6,410 |  |     |     | 1  | %
|Subdivision construction commitments |                      |                              | 130   |           |       |          | 143   |              |       |          | (9  | )%  |    |   | 170   |       |       |  | (24 | )% 
|                                     |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |    
|                                     |                      | Total production volume      |       | $         | 6,585 |          |       | $            | 4,202 |          |     |     | 57 | % |       | $     | 6,580 |  |     |     | 0  | %
|                                     |                      |                              |       |           |       |          |       |              |       |          |     |     |    |   |       |       |       |  |     |    
|Mortgage  Web-based
    production  |                      | $                            | 4,920 |           |       | $        | 3,242 |              |       |          | 52  | %   |    | $ | 4,843 |       |       |  | 2   | %  
|Mortgage pipeline at period end(3)   |                      | $                            | 6,044 |           |       | $        | 3,008 |              |       |          | 101 | %   |    | $ | 4,723 |       |       |  | 28  | %  



---



|    |                                                                                                                                         
|--- | ----------------------------------------------------------------------------------------------------------------------------------------
|(1) | Fundings.                                                                                                                               
|   
|(2) | New commitments.                                                                                                                        
|   
|(3) | Includes rate lock commitments for loans in
    process plus loans that have been submitted for processing, but
    not yet rate locked.

Mortgage Production by Division and
Channel

IndyMac generates its mortgage production through
multiple channels on a nationwide basis with a concentration in
those regions of the country in which we have regional offices
or in which there are higher home prices, including California,
Florida, New Jersey and New York. Our highest concentration of
mortgage loans relates to properties in California. Mortgages
secured by California properties accounted for 52% of the
mortgage loans produced in the first three months of 2003 based
on dollar value, and 44% based on number of loans.

IndyMac Mortgage Bank produces mortgages through
its Business-to-Business (B2B), Business-to-Realtor
(B2R), Consumer Construction (Home
Construction Lending or HCL) and Homebuilder
(HBD) divisions. IndyMac Consumer Bank produces
mortgages through its Business-to-Consumer (B2C),
HELOC and Retail Bank divisions.

10



---



##### 



The following table shows production and key
performance indicators of the various relationship businesses of
IndyMac Mortgage Bank during the three months ended
March 31, 2003.

|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |       |       |  
|---------------------------------------------------------------------------------- | ------------------------------------------------ | ----------------------------------------------- | --- | ----- | ----- | --- | --- | --- | --- | ----- | -- | --- | --- | - | --- | --- | --- | - | --- | ----- | ----- | -
|                                                                                   |                                                  |                                                
|                                                                                   |                                                  | Relationship Businesses                       
|                                                                                   |                                                  | IndyMac Mortgage Bank                          
|                                                                                   |                                                  |                                                
|                                                                                   |                                                  | B2B                                             |     | B2R   |       | HCL |     | HBD |     | Total
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |      
|                                                                                   |                                                  |                                                
|                                                                                   |                                                  | (Dollars in millions)                          
|Volume by Channel and Customer
    Source                                          |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   | Mortgage brokers                                 |                                                 | $   | 2,887 |       |     | $   |    |     |       | $  | 309 |     |   | $   |    |     |   | $   | 3,196 |      
|                                                                                   | Mortgage bankers                                 |                                                 |     | 694   |       |     |     |    |     |       |    | 233 |     |   |     |    |     |   |     | 927   |      
|                                                                                   | Conduit                                          |                                                 |     | 339   |       |     |     |    |     |       |    |    |     |   |     |    |     |   |     | 339   |      
|                                                                                   | Realtors                                         |                                                 |     |      |       |     |     | 246 |     |       |    |    |     |   |     |    |     |   |     | 246   |      
|                                                                                   | Builder/ Builder affiliates                      |                                                 |     |      |       |     |     |    |     |       |    | 17  |     |   |     | 92  |     |   |     | 109   |      
|                                                                                   | Financial institutions                           |                                                 |     | 83    |       |     |     |    |     |       |    |    |     |   |     |    |     |   |     | 83    |      
|                                                                                   | Consumer direct marketing by HCL                 |                                                 |     |      |       |     |     |    |     |       |    | 122 |     |   |     |    |     |   |     | 122   |      
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   |                                                  | Subtotal mortgage production                    |     |       | 4,003 |     |     | $   | 246 |       |    |     | 681 |   |     |     | 92  |   |     |       | 5,022 |  
|                                                                                   | Builder and subdivision construction commitments |                                                 |     |      |       |     |     |    |     |       |    |    |     |   |     | 130 |     |   |     | 130   |      
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   |                                                  | Total relationship businesses production volume |     | $     | 4,003 |     |     | $   | 246 |       |    | $   | 681 |   |     | $   | 222 |   |     | $     | 5,152 |  
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|Percentage of total production                                                     |                                                  |                                                 | 61  | %     |       |     | 4   | %   |     |       | 10 | %   |     |   | 3   | %   |     |   | 78  | %    
|                                                                                   |                                                  | Total production 1st quarter 2002               |     | $     | 2,844 |     |     | $   | 94  |       |    | $   | 528 |   |     | $   | 147 |   |     | $     | 3,613 |  
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   |                                                  | Total production 4th quarter 2002               |     | $     | 4,243 |     |     | $   | 213 |       |    | $   | 617 |   |     | $   | 250 |   |     | $     | 5,323 |  
|                                                                                   |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|Composition of mortgage production                                                 |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   |                                                  | Purchase transactions                           |     |       | 24    | %   |     |     | 29  | %     |    |     | 95  | % |     |     | 75  | % |     |       | 37    | %
|                                                                                   |                                                  | Cash-out refinance transactions                 |     |       | 48    | %   |     |     | 35  | %     |    |     | 0   | % |     |     | 12  | % |     |       | 39    | %
|                                                                                   |                                                  | Rate/term refinance transactions                |     |       | 28    | %   |     |     | 36  | %     |    |     | 5   | % |     |     | 13  | % |     |       | 24    | %
|Key Performance Indicators for the Three
    Months Ended March 31, 2003           |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|Active Customers(1)                                                                |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   | Average monthly active customers                 |                                                 |     | 1,991 |       |     |     | 225 |     |       |    | 198 |     |   |     | 6   |     |   |     | 2,420 |      
|                                                                                   | Active customers during the quarter              |                                                 |     | 3,161 |       |     |     | 459 |     |       |    | 487 |     |   |     | 15  |     |   |     | 4,122 |      
|                                                                                   | Net new customers during the quarter(2)          |                                                 |     | 441   |       |     |     | 64  |     |       |    | N/A |     |   |     | 5   |     |   |     | 510   |      
|Sales and marketing Personnel                                                      |                                                  |                                                 | 311 |       |       |     | 68  |     |     |       | 60 |     |     |   | 14  |     |     |   | 452 |      
|Cost per funded loan (mortgage) (bps)                                              |                                                  |                                                 | 76  |       |       |     | 207 |     |     |       | 77 |     |     |   | 113 |     |     |   | NM  |      
|Percentage Change for the Three Months Ended
    March 31, 2003 vs. March 31, 2002 |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|Active Customers(1)                                                                |                                                  |                                                 |     |       |       |     |     |     |     |       |    |     |     |   |     |     |     |   |     |      
|                                                                                   | Average monthly active customers                 |                                                 |     | 8     | %     |     |     | 125 | %   |       |    | 23  | %   |   |     | (25 | )%  |   |     | 14    | %    
|                                                                                   | Active customers during the quarter              |                                                 |     | 14    | %     |     |     | 112 | %   |       |    | 25  | %   |   |     | (29 | )%  |   |     | 17    | %    
|Sales and marketing Personnel                                                      |                                                  |                                                 | 11  | %     |       |     | 142 | %   |     |       | 54 | %   |     |   | (30 | )%  |     |   | 23  | %    
|Cost per funded loan (mortgage) (bps)                                              |                                                  |                                                 | (21 | )%    |       |     | (23 | )%  |     |       | 1  | %   |     |   | (88 | )%  |     |   | NM  |      



---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Active customers are defined as customers who
    funded at least one loan during the period. The HCL division
    utilizes the B2B marketing relationships with mortgage brokers
    and mortgage bankers to produce consumer construction loans. As
    a result, there is some overlap of the two active customer
    statistics and new customers are reported under the B2B channel
    only. The sales and marketing personnel under the HCL division
    are primarily focused on marketing the consumer construction
    product directly to consumers.

11



---



##### 





|    |                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------
|(2) | Net new customers is the number of new customers
    signed up during the quarter less those terminated.

IndyMac Mortgage Banks production increase
of 43% from the three months ended March 31, 2002 to the
three months ended March 31, 2003 was driven by 41% growth
in the core B2B channel and bolstered by even faster growth in
our newer channels including B2R, HCL and HBD. The mix of
business was driven heavily towards refinance activity,
reflecting the overall refinance environment. In addition, we
continue to focus on activating new customers and made progress
in all channels. At the same time, we have been more disciplined
in adding new customers that possess a profile that is more
likely to remain active over the long term. Consistent with our
focus on new customers, we are expanding our sales staff in all
channels, focusing on under-penetrated markets consistent with
our overall strategy to expand the geographic distribution of
our operating centers. With respect to costs, while we continue
to implement permanent process improvements in our mortgage
operations, the bulk of improvements in costs in basis points
are attributable to greater scale due to increased volume and
higher average balances obtainable in a refinance environment.

The following table shows production and other
key performance indicators of the various consumer direct
businesses of IndyMac Consumer Bank during the three months
ended March 31, 2003.

|                                                                                      |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |       |  
|------------------------------------------------------------------------------------- | --------------------------------------- | ---------------------------- | ----- | ----- | - | ----------- | --- | ----- |  | - | --- | -- | - | - | ----- | ----- | -
|                                                                                      |                                         |                             
|                                                                                      |                                         | Consumer Direct Businesses 
|                                                                                      |                                         | IndyMac Consumer Bank       
|                                                                                      |                                         |                             
|                                                                                      |                                         | B2C                          |       | HELOC |   | Retail Bank |     | Total
|                                                                                      |                                         |                              |       |       |   |             |     |      
|                                                                                      |                                         |                             
|                                                                                      |                                         | (Dollars in millions)       
|Volume by Channel and Source(1)                                                       |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|Web-based Production                                                                  |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|                                                                                      | Direct at www.indymacmortgage.com       |                              | $     | 328   |   |             | $   |      |  |   | $   |   |   |   | $     | 328   |  
|                                                                                      | Indirect Web-based leads                |                              |       | 99    |   |             |     |      |  |   |     |   |   |   |       | 99    |  
|Cross-marketing and portfolio refinancing                                             |                                         |                              | 675   |       |   |             |    |       |  |   |    |    |   |   | 675   |      
|Direct telemarketing and affinity relationships                                       |                                         |                              | 212   |       |   |             | 41  |       |  |   |    |    |   |   | 253   |      
|Retail banking branches                                                               |                                         |                              | N/A   |       |   |             |    |       |  |   | 78  |    |   |   | 78    |      
|                                                                                      |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|                                                                                      | Total consumer direct production volume |                              | $     | 1,314 |   |             | $   | 41    |  |   | $   | 78 |   |   | $     | 1,433 |  
|                                                                                      |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|Percentage of total production                                                        |                                         |                              | 20    | %     |   |             | 1   | %     |  |   | 1   | %  |   |   | 22    | %    
|Total production 1st quarter 2002                                                     |                                         | $                            | 567   |       |   | $           |    |       |  | $ | 23  |    |   | $ | 590   |      
|                                                                                      |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|Total production 4th quarter 2002                                                     |                                         | $                            | 1,187 |       |   | $           | 15  |       |  | $ | 55  |    |   | $ | 1,257 |      
|                                                                                      |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|Composition of mortgage production                                                    |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|                                                                                      | Purchase transactions                   |                              |       | 4     | % |             |     | N/A   |  |   |     | 15 | % |   |       | 5     | %
|                                                                                      | Cash-out refinance transactions         |                              |       | 37    | % |             |     | N/A   |  |   |     | 35 | % |   |       | 37    | %
|                                                                                      | Rate/term refinance transactions        |                              |       | 59    | % |             |     | N/A   |  |   |     | 50 | % |   |       | 58    | %
|Key Drivers of Growth and Profitability for
    the Three Months Ended March 31, 2003 |                                         |                              |       |       |   |             |     |       |  |   |     |    |   |   |       |      
|Marketing costs (in thousands)                                                        |                                         | $                            | 2,862 |       |   |             | N/A |       |  | $ | 32  |    |   | $ | 2,894 |      
|Marketing cost per funded loan (dollars)                                              |                                         | $                            | 419   |       |   |             | N/A |       |  | $ | 79  |    |   | $ | 498   |      
|Cost per funded loan (mortgage) (bps)                                                 |                                         |                              | 154   |       |   |             | N/A |       |  |   | 141 |    |   |   | NM    |      



---



|    |                                                                                                                                                                                                                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | HELOC amounts represent the loans produced only
    by the HELOC division. HELOC loans produced by other business
    divisions totaled $139 million during the first quarter of
    2003. HELOC loans produced by business divisions other than the
    HELOC division are included in the production volume of the
    respective originating business division.

B2Cs production volume grew 132% for the
three months ended March 31, 2003 compared to the three
months ended March 31, 2002, resulting in a decrease in
cost per funded loan of 18%. The B2C division is currently our
most established consumer-direct business, generating 92% of the
total consumer-direct business in 2003. This business is
expected to be more cyclical as a result of changes in interest
rates. The HELOC

12



---



##### 



division was established during 2002 to
facilitate targeted marketing of our HELOC product directly to
consumers in addition to the production of HELOCs within our
other production channels. Through a streamlined application
process and competitive pricing, this division provides
homeowners the ability to easily access the excess equity in
their homes for a variety of uses. Currently, we hold the HELOCs
generated by the HELOC division for investment, as these HELOCs
are prime rate based, high FICO scores & lower
loan-to-value. The HELOC product also tends to be somewhat
counter-cyclical to the mortgage industry. As interest rates
rise, consumers who want to access the equity in their home are
more inclined to utilize a HELOC product rather than a cash-out
refinance of their existing low-rate mortgage loan. As a result,
we expect the HELOC divisions production to increase when
the mortgage refinance boom abates.


Loan Sales

The Company sold $5.5 billion of loans
during the first three months of 2003 and $4.3 billion of
loans during the first three months of 2002. The Companys
gain on sale of loans increased 9.1% in the first quarter of
2003 to $84 million, from $77 million in the first
quarter of 2002. The increase in the gain on sale was a result
of the 29.8% increase in loans sold, partially offset by the
decrease of 30 basis points in the profit margin, net of hedging
gains and losses, from 1.82% in the first quarter of 2002 to
1.52% in the first quarter of 2003. The increase in loans sold
is lower than the increase in total loans produced due to the
fact that we sold only 95% of available production in the first
quarter of 2003 in comparison to the sale of 117% of total
available production in the first quarter of 2002. The decrease
in the net margin after hedging is due to a combination of
factors including: (1) increased competition early in the
first quarter of 2003 as interest rates began to increase;
(2) an increase in the sale of lower margin loans;
(3) higher hedging costs due to the volatility of interest
rates as geopolitical issues surfaced; and (4) additions to
our repurchase reserve. These items were partially offset by the
sale of certain higher margin loans that were obtained through
the exercise of IndyMacs call provision as the master
servicer of its loan securitization transactions.

The Company hedges the interest rate risk
inherent in its pipeline of mortgage loans held for sale to
protect its margin on sale of loans. In a period of declining
interest rates, hedging has the effect of reducing the gain on
sale of the Companys mortgage loans. In a period of rising
rates, hedging protects the Company from deterioration in the
net margin. The table below illustrates the impact of the
Companys pipeline hedging activities.

|                                  |  |                       |      |           |  |          |      |              |  |          |     |    |  |   |      |   |  |  |     |   
|--------------------------------- |  | --------------------- | ---- | --------- |  | -------- | ---- | ------------ |  | -------- | --- | -- |  | - | ---- | - |  |  | --- | --
|                                  |  |                      
|                                  |  | Three Months Ended   
|                                  |  |                      
|                                  |  | March 31,             |      | March 31, |  |          |      | December 31, |  |         
|                                  |  | 2003                  |      | 2002      |  | % Change |      | 2002         |  | % Change
|                                  |  |                       |      |           |  |          |      |              |  |         
|                                  |  |                      
|                                  |  | (Dollars in millions)
|Gross gain on mortgage loan sales |  | $                     | 118  |           |  | $        | 91   |              |  |          | 30  | %  |  | $ | 132  |   |  |  | (11 | )%
|Gross margin before hedging       |  |                       | 2.14 | %         |  |          | 2.13 | %            |  |          | 0   | %  |  |   | 3.02 | % |  |  | (29 | )%
|Hedging gains (losses)            |  | $                     | (34  | )         |  | $        | (14  | )            |  |          | 143 | %  |  | $ | (57  | ) |  |  | (40 | )%
|Net gains on sale                 |  | $                     | 84   |           |  | $        | 77   |              |  |          | 8   | %  |  | $ | 75   |   |  |  | 12  | % 
|Net margin after hedging          |  |                       | 1.52 | %         |  |          | 1.82 | %            |  |          | (16 | )% |  |   | 1.71 | % |  |  | (11 | )%

The Company enters into commitments to make loans
whereby the interest rate on the loan is set prior to funding
(rate lock commitments). Rate lock commitments on
mortgage loans that are intended to be sold are considered to be
derivatives pursuant to SFAS No. 133, Accounting
for Derivative Instruments and Hedging Activities,
(SFAS 133) and therefore, they are recorded at
fair value. The Company hedges the risk of changes in fair value
of rate lock commitments by selling forward contracts on
securities of Fannie Mae or Freddie Mac. These forward contracts
are also accounted for as derivatives and recorded at fair value.

In measuring the fair value of rate lock
commitments, the expected profit margin of the loan that would
be realized upon a loan sale is used. This value excludes the
value of the MSRs inherent in the loan except for certain high
quality, liquid conventional mortgages where whole loan sale
prices including servicing rights are readily available. These
values are calculated using the same methodologies that are used
in our loan sales, adjusted using an anticipated fallout factor
for rate lock commitments that will likely not be funded. This
policy of recognizing the value of the derivative has the effect
of recognizing a portion of the gain from

13



---



##### 



mortgage loans before the loans are funded. There
is a diversity in practice among participants in the mortgage
banking industry, and the possibility exists that further
accounting guidance for determining the fair value of rate lock
commitments could be developed, which would result in a change
in our valuation policies. It is important to note that the time
from rate lock commitment to loan sale is generally less than
90 days; therefore, any change to current practice would
have only a short-term impact on revenues and net income. As of
March 31, 2003, the fair value of the rate lock
commitments, net of related hedges, was $35.4 million.


In addition to the gain on sale, IndyMac earns
spread and fee income on its mortgage loans held for sale. It is
important to look at the entire mortgage banking revenue stream
in evaluating performance as these components may vary in
differing interest rate environments and sale strategies. The
following table depicts the total revenue margin on mortgage
loans sold, which is calculated by dividing the sum of gain on
sale of loans, net interest income (refer to Note 3:
Segment Reporting in the accompanying notes to the
consolidated financial statements for further information on our
method of allocating interest expense to the operating
segments), and fee income by the amount of loans sold:

|                               |  |                        |           |            |  |           |      |            |  |              |           |            |  |  |      |   |  |   |           |  |  |  |      |  
|------------------------------ |  | ---------------------- | --------- | ---------- |  | --------- | ---- | ---------- |  | ------------ | --------- | ---------- |  |  | ---- | - |  | - | --------- |  |  |  | ---- | -
|                               |  |                       
|                               |  | Three Months Ended    
|                               |  |                       
|                               |  | March 31,              |           | % of loans |  | March 31, |      | % of loans |  | December 31, |           | % of loans
|                               |  | 2003                   |           | sold       |  | 2002      |      | sold       |  | 2002         |           | sold      
|                               |  |                        |           |            |  |           |      |            |  |              |           |           
|                               |  |                       
|                               |  | (Dollars in thousands)
|Gain on sale of loans          |  | $                      | 83,784    |            |  |           | 1.52 | %          |  | $            | 77,466    |            |  |  | 1.82 | % |  | $ | 74,775    |  |  |  | 1.71 | %
|Net interest income            |  |                        | 32,007    |            |  |           | 0.58 | %          |  |              | 25,703    |            |  |  | 0.60 | % |  |   | 28,228    |  |  |  | 0.64 | %
|Fee income                     |  |                        | 14,791    |            |  |           | 0.26 | %          |  |              | 9,917     |            |  |  | 0.23 | % |  |   | 13,988    |  |  |  | 0.32 | %
|                               |  |                        |           |            |  |           |      |            |  |              |           |            |  |  |      |   |  |   |           |  |  |  |      |  
|Total mortgage banking revenue |  | $                      | 130,582   |            |  |           | 2.36 | %          |  | $            | 113,086   |            |  |  | 2.65 | % |  | $ | 116,991   |  |  |  | 2.67 | %
|                               |  |                        |           |            |  |           |      |            |  |              |           |            |  |  |      |   |  |   |           |  |  |  |      |  
|Loans sold                     |  | $                      | 5,523,701 |            |  |           |      |            |  | $            | 4,266,319 |            |  |  |      |   |  | $ | 4,378,410 |  |  |  |      |  

The following table shows the various channels
through which loans were distributed.

|                                     |                         |                       |       |              |  |           |    |              |   |              |       |              |  |  |    |     |   |   |       |       |  |  |    |     |  
|------------------------------------ | ----------------------- | --------------------- | ----- | ------------ |  | --------- | -- | ------------ | - | ------------ | ----- | ------------ |  |  | -- | --- | - | - | ----- | ----- |  |  | -- | --- | -
|                                     |                         |                      
|                                     |                         | Three Months Ended   
|                                     |                         |                      
|                                     |                         | March 31,             |       | Distribution |  | March 31, |    | Distribution |   | December 31, |       | Distribution
|                                     |                         | 2003                  |       | Percentages  |  | 2002      |    | Percentages  |   | 2002         |       | Percentages 
|                                     |                         |                       |       |              |  |           |    |              |   |              |       |             
|                                     |                         |                      
|                                     |                         | (Dollars in millions)
|Sales to the GSEs(1)                 |                         | $                     | 3,464 |              |  |           | 58 | %            |   | $            | 2,618 |              |  |  | 60 | %   |   | $ | 2,286 |       |  |  | 45 | %  
|Private-label securitizations        |                         |                       | 1,471 |              |  |           | 25 | %            |   |              | 1,542 |              |  |  | 35 | %   |   |   | 1,489 |       |  |  | 29 | %  
|Whole loan sales                     |                         |                       | 589   |              |  |           | 10 | %            |   |              | 106   |              |  |  | 2  | %   |   |   | 603   |       |  |  | 12 | %  
|                                     |                         |                       |       |              |  |           |    |              |   |              |       |              |  |  |    |     |   |   |       |       |  |  |    |    
|                                     | Subtotal sales          |                       |       | 5,524        |  |           |    | 93           | % |              |       | 4,266        |  |  |    | 97  | % |   |       | 4,378 |  |  |    | 86  | %
|Investment portfolio acquisitions(2) |                         |                       | 403   |              |  |           | 7  | %            |   |              | 149   |              |  |  | 3  | %   |   |   | 721   |       |  |  | 14 | %  
|                                     |                         |                       |       |              |  |           |    |              |   |              |       |              |  |  |    |     |   |   |       |       |  |  |    |    
|                                     | Total loan distribution |                       | $     | 5,927        |  |           |    | 100          | % |              | $     | 4,415        |  |  |    | 100 | % |   | $     | 5,099 |  |  |    | 100 | %
|                                     |                         |                       |       |              |  |           |    |              |   |              |       |              |  |  |    |     |   |   |       |       |  |  |    |    



---



|    |                                                                                
|--- | -------------------------------------------------------------------------------
|(1) | Government-sponsored enterprises.                                              
|   
|(2) | Loan production that IndyMac elected to retain in
    its investment portfolio.

In conjunction with the sale of mortgage loans in
private-label securitization and GSE transactions, the Company
generally retains certain assets. The primary assets retained
include MSRs and, to a lesser degree, AAA-rated and agency
interest-only securities, non-investment grade securities and
residual securities. The allocated cost of the retained assets
at the time of sale is recorded as an asset with an offsetting
increase to the gain on sale of loans (or a reduction in the
cost basis of the loans sold). The calculation of the
$83.8 million in gain on sale of loans earned during the
three months ended March 31, 2003 included the retention of
$93.4 million of servicing-related assets. More information
on the valuation assumptions related to IndyMacs retained
assets can be found on page 21.

14



---



##### 



INVESTING ACTIVITIES

IndyMacs Investment Portfolio Group
complements the Companys mortgage banking activities and
serves to diversify the Companys revenue stream through
its investments in single-family residential mortgage loans,
mortgage-backed securities and MSRs. The Investment Portfolio
Group also invests in certain of the mortgage assets that are
created through the securitization or sale of loans in the
secondary market.

The Investment Portfolio Groups investment
in prime SFR loans, mortgage-backed securities and mortgage loan
servicing also helps to provide a source of income to
counterbalance the cyclical nature of mortgage production.
Should loan production decline due to factors such as increasing
interest rates, the value of the Investment Portfolio
Groups MSRs generally rises, as there is less incentive
for borrowers to refinance at a higher interest rate. Similarly,
when loan production increases, the value of the MSRs generally
decrease. We believe this serves to stabilize the Companys
revenue stream through increased interest income and servicing
fees when production slows.

In addition to the Investment Portfolio
Groups investments, certain investing activities also take
place in IndyMac Mortgage Bank and IndyMac Consumer Bank. These
activities include the investment in construction loans and the
HELOCs by such areas.

The following table shows average annualized net
returns for all of our investing activities, which is calculated
by dividing the sum of net interest income after allocated
interest expense (see Note 3: Segment Reporting
in the accompanying notes to the consolidated financial
statements for further information on our method of allocating
interest expense to the operating segments) and provision for
loan losses, service fee income and related net gains or losses
by the average balance of investment assets. Service fee income
includes contractual servicing fees, gross service fee income,
amortization of MSRs, valuation adjustments and net hedging
gains and losses. Gross service fee income is comprised of
reinvestment income, prepayment and late fee income net of
compensating interest paid to borrowers and investors.

|                                                                                  |  |                        |           |           |  |              |           |   |  |   |           |  
|--------------------------------------------------------------------------------- |  | ---------------------- | --------- | --------- |  | ------------ | --------- | - |  | - | --------- | -
|                                                                                  |  |                       
|                                                                                  |  | Three Months Ended    
|                                                                                  |  |                       
|                                                                                  |  | March 31,              |           | March 31, |  | December 31,
|                                                                                  |  | 2003                   |           | 2002      |  | 2002        
|                                                                                  |  |                        |           |           |  |             
|                                                                                  |  |                       
|                                                                                  |  | (Dollars in thousands)
|Net interest income after provision for loan
    losses                           |  | $                      | 36,150    |           |  | $            | 38,415    |   |  | $ | 30,113    |  
|Service fee income                                                                |  |                        | 2,383     |           |  |              | 7,822     |   |  |   | 1,377     |  
|(Loss) gain on mortgage-backed securities, net                                    |  |                        | (6,910    | )         |  |              | (6,988    | ) |  |   | 1,052     |  
|Other income                                                                      |  |                        | 2,936     |           |  |              | 3,692     |   |  |   | 2,927     |  
|Average balance of interest-earning assets and
    MSRs                           |  | $                      | 6,211,387 |           |  | $            | 4,885,819 |   |  | $ | 5,637,509 |  
|Investing activities return on
    interest-earning assets and MSRs (annualized) |  |                        | 2.21      | %         |  |              | 3.56      | % |  |   | 2.50      | %
|                                                                                  |  |                        |           |           |  |              |           |   |  |   |           |  

The decrease in margin results from the impact on
MSRs and mortgage-backed securities of higher prepayment rates
in this low interest rate environment.

Investment Portfolio Group

The composition of the Investment Portfolio
Groups assets include SFR mortgage loans held for
investment, mortgage-backed securities and MSRs and may include
U.S. Treasury securities and agency

15



---



##### 



debentures used to hedge MSRs. The following
table sets forth the balances associated with each of these
portfolios as of March 31, 2003 and December 31, 2002,
respectively.


|                                                              |                               |                                               |                                                    |              |           |           |           |   |           |           | 
|------------------------------------------------------------- | ----------------------------- | --------------------------------------------- | -------------------------------------------------- | ------------ | --------- | --------- | --------- | - | --------- | --------- | 
|                                                              |                               | March 31,                                     |                                                    | December 31,
|                                                              |                               | 2003                                          |                                                    | 2002        
|                                                              |                               |                                               |                                                    |             
|                                                              |                               |                                              
|                                                              |                               | (Dollars in thousands)                       
|SFR mortgage loans held for
    investment                    |                               | $                                             | 2,218,100                                          |              |           | $         | 2,096,517 |  
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|Mortgage-backed and U.S. Treasury
    securities:             |                               |                                               |                                                    |              |           |           |           |  
|                                                              | Trading securities            |                                               |                                                    |              |           |           |           |   |          
|                                                              |                               | AAA-rated and agency interest-only securities |                                                    |              | 156,212   |           |           |   | 187,060   |          
|                                                              |                               | AAA-rated principal-only securities           |                                                    |              | 3,295     |           |           |   | 79,554    |          
|                                                              |                               | U.S. Treasury securities                      |                                                    |              |          |           |           |   | 282,219   |          
|                                                              |                               | AAA-rated non-agency securities               |                                                    |              |          |           |           |   | 101,185   |          
|                                                              |                               | AAA-rated agency securities                   |                                                    |              |          |           |           |   | 25,055    |          
|                                                              |                               | Other investment grade securities             |                                                    |              | 9,067     |           |           |   | 9,114     |          
|                                                              |                               | Other non-investment grade securities         |                                                    |              | 2,806     |           |           |   | 2,956     |          
|                                                              |                               | Non-investment grade residual securities      |                                                    |              | 77,998    |           |           |   | 78,740    |          
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|                                                              |                               |                                               | Subtotal  trading securities                      |              |           | 249,378   |           |   |           | 765,883   | 
|                                                              | Available for sale securities |                                               |                                                    |              |           |           |           |   |          
|                                                              |                               | AAA-rated non-agency securities               |                                                    |              | 1,253,963 |           |           |   | 1,406,321 |          
|                                                              |                               | AAA-rated agency securities                   |                                                    |              | 86,013    |           |           |   | 123,269   |          
|                                                              |                               | Other investment grade securities             |                                                    |              | 37,959    |           |           |   | 39,258    |          
|                                                              |                               | Other non-investment grade securities         |                                                    |              | 6,546     |           |           |   | 4,362     |          
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|                                                              |                               |                                               | Subtotal  available for sale securities           |              |           | 1,384,481 |           |   |           | 1,573,210 | 
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|                                                              |                               |                                               | Total mortgage-backed and U.S. Treasury securities |              |           | 1,633,859 |           |   |           | 2,339,093 | 
|Mortgage servicing rights                                     |                               |                                               | 343,544                                            |              |           |           | 300,539   |  
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|                                                              |                               |                                               | Total                                              |              | $         | 4,195,503 |           |   | $         | 4,736,148 | 
|                                                              |                               |                                               |                                                    |              |           |           |           |  
|Percentage of securities portfolio rated
    investment grade |                               |                                               | 95                                                 | %            |           |           | 96        | %
|Percentage of securities portfolio rated AAA                  |                               |                                               | 92                                                 | %            |           |           | 94        | %

AAA-rated and agency interest-only securities and
non-investment grade residual securities and securities used to
hedge these securities, are classified as trading securities.
Changes in the fair value of these securities are recorded in
earnings. All other mortgage-backed securities are classified as
available for sale.



| |                                           
| | ------------------------------------------
| | SFR Mortgage Loans Held for
    Investment

The Companys portfolio of mortgage loans
held for investment is comprised primarily of SFR mortgage
loans, with a concentration in adjustable-rate loans to mitigate
interest rate risk. The Company is focused on increasing its
portfolio of mortgage loans held for investment to achieve
better balance in its investing activities relative to its
mortgage banking activities, which tends to be more cyclical.
During the quarter, the Company added $403 million of
mortgage loans in accordance with this strategy. The following
table shows

16



---



##### 



the composition of this portfolio as of
March 31, 2003 and December 31, 2002, respectively,
and relevant credit quality characteristics at March 31,
2003.


|                                                  |                               |                        |           |              |     |   |           |   |  | 
|------------------------------------------------- | ----------------------------- | ---------------------- | --------- | ------------ | --- | - | --------- | - |  | 
|                                                  |                               | March 31,              |           | December 31,
|                                                  |                               | 2003                   |           | 2002        
|                                                  |                               |                        |           |             
|                                                  |                               |                       
|                                                  |                               | (Dollars in thousands)
|SFR mortgage loans held for investment            |                               | $                      | 2,218,100 |              |     | $ | 2,096,517 |  
|Average loan size                                 |                               | $                      | 257       |              |     | $ | 227       |  
|Non-performing loans as a percentage of SFR loans |                               |                        | 0.92      | %            |     |   | 1.20      | %
|Estimated average life in years(1)                |                               |                        | 3.34      |              |     |   | 3.36      |  
|Estimated average duration in years(2)            |                               |                        | 1.22      |              |     |   | 1.39      |  
|Yield                                             |                               |                        | 5.28      | %            |     |   | 5.69      | %
|Fixed-rate mortgages                              |                               |                        | 19        | %            |     |   | 23        | %
|Adjustable-rate mortgages                         |                               |                        | 30        | %            |     |   | 28        | %
|Hybrid adjustable-rate mortgages                  |                               |                        | 51        | %            |     |   | 49        | %
|Additional Information as of March 31,
    2003  
|                                                 
|Average FICO score(3)                             |                               |                        | 708       |              |     |   |           |  
|Average loan to value ratio                       |                               |                        | 68        | %            |     |   |           |  
|Geographic distribution:                          |                               |                        |           |              |     |   |           |  
|                                                  | Southern California           |                        |           | 37           | %   |   |           |   | 
|                                                  | Northern California           |                        |           | 23           | %   |   |           |   | 
|                                                  | New York                      |                        |           | 5            | %   |   |           |   | 
|                                                  | Florida                       |                        |           | 2            | %   |   |           |   | 
|                                                  | Colorado                      |                        |           | 2            | %   |   |           |   | 
|                                                  | New Jersey                    |                        |           | 2            | %   |   |           |   | 
|                                                  | Other (each individually< 2%) |                        |           | 29           | %   |   |           |   | 
|                                                  |                               |                        |           |              |     |   |           |  
|                                                  |                               | Total                  |           |              | 100 | % |           |   |  | 
|                                                  |                               |                        |           |              |     |   |           |  



---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Represents the estimated length of time, on
    average, the SFR loan portfolio will remain outstanding based on
    the Banks estimates for prepayments.                                                                                                                                                                                                                                                                       
|   
|(2) | Average duration measures the volatility of the
    value of a financial instrument in response to changes in
    interest rates and the corresponding changes in prepayments.                                                                                                                                                                                                                                                   
|   
|(3) | FICO scores are the result of a credit scoring
    system developed by Fair Isaacs and Co. and are generally used
    by lenders to evaluate a borrowers credit history. FICO
    scores of 700 or higher are generally considered in the mortgage
    industry to be very high quality borrowers with low risk of
    default, but in general, the secondary market will consider FICO
    scores of 620 or higher to be prime.



| |                                                            
| | -----------------------------------------------------------
| | Mortgage-backed Securities and
    U.S. Treasury Securities

The Companys portfolio of mortgage-backed
securities and U.S. Treasury securities totaled
$1.6 billion and $2.3 billion at March 31, 2003
and December 31, 2002, respectively. These securities are
recorded at fair value. The Company invests in high quality
mortgage-backed securities to provide a stable source of net
spread income, albeit spread income has fluctuated during recent
quarters due to the significant decline in interest rates in
2002. At March 31, 2003, 92% of the portfolio was rated AAA
with expected average lives ranging from 3 months to
5 years. U.S. Treasury securities and AAA-rated
principal-only securities in the trading portfolio are purchased
to hedge the interest rate risk associated with
servicing-related assets, among other types of investments. The
Company actively trades its hedging instruments to rebalance its
portfolio into instruments we believe will most effectively
hedge the underlying asset. During the first quarter of 2003, the

17



---



##### 



Company sold its hedging investment in
U.S. Treasury securities and certain other mortgage-backed
securities and replaced them with non-security hedging
investments such as swaps and swap-based floors.


The fair value of other investment grade and
non-investment grade securities by credit rating as of
March 31, 2003 and December 31, 2002 follows:

|                                                                |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|--------------------------------------------------------------- |  | ---------------------- | ------ | ------------ |  | --------- | ------- | ----- |  | ----- | ------ |  |  | - | ------ |  |  | - | ------ | 
|                                                                |  |                        |        |             
|                                                                |  | March 31,              |        | December 31,
|                                                                |  | 2003                   |        | 2002        
|                                                                |  |                        |        |             
|                                                                |  | Current                |        | Discount     |  |           |         |      
|                                                                |  | Face                   |        | To Face      |  | Amortized |         | Fair  |  | Fair 
|                                                                |  | Value                  |        | Value        |  | Cost      |         | Value |  | Value
|                                                                |  |                        |        |              |  |           |         |       |  |      
|                                                                |  |                       
|                                                                |  | (Dollars in thousands)
|Investment grade mortgage-backed
    securities                 |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|AA                                                              |  | $                      | 20,780 |              |  | $         | (101    | )     |  | $     | 20,679 |  |  | $ | 22,030 |  |  | $ | 22,133 | 
|A                                                               |  |                        | 2,345  |              |  |           | (127    | )     |  |       | 2,218  |  |  |   | 2,441  |  |  |   | 2,445  | 
|BBB                                                             |  |                        | 18,110 |              |  |           | (931    | )     |  |       | 17,179 |  |  |   | 17,550 |  |  |   | 18,450 | 
|BBB-                                                            |  |                        | 5,325  |              |  |           | (362    | )     |  |       | 4,963  |  |  |   | 5,005  |  |  |   | 5,344  | 
|                                                                |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|Total other investment grade mortgage-backed
    securities     |  | $                      | 46,560 |              |  | $         | (1,521  | )     |  | $     | 45,039 |  |  | $ | 47,026 |  |  | $ | 48,372 | 
|                                                                |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|Non-investment grade mortgage-backed
    securities             |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|BB                                                              |  | $                      | 4,247  |              |  | $         | (747    | )     |  | $     | 3,500  |  |  | $ | 3,513  |  |  | $ | 3,661  | 
|BB-                                                             |  |                        | 1,812  |              |  |           | (944    | )     |  |       | 868    |  |  |   | 870    |  |  |   |       | 
|B                                                               |  |                        | 4,679  |              |  |           | (3,599  | )     |  |       | 1,080  |  |  |   | 1,113  |  |  |   | 351    | 
|CCC                                                             |  |                        | 1,135  |              |  |           | (567    | )     |  |       | 568    |  |  |   | 568    |  |  |   | 2,955  | 
|C                                                               |  |                        | 9,704  |              |  |           | (6,770  | )     |  |       | 2,934  |  |  |   | 2,939  |  |  |   |       | 
|NR                                                              |  |                        | 873    |              |  |           | (540    | )     |  |       | 333    |  |  |   | 349    |  |  |   | 351    | 
|                                                                |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 
|Total other non-investment grade mortgage-backed
    securities |  | $                      | 22,450 |              |  | $         | (13,167 | )     |  | $     | 9,283  |  |  | $ | 9,352  |  |  | $ | 7,318  | 
|                                                                |  |                        |        |              |  |           |         |       |  |       |        |  |  |   |        |  |  |   |        | 

At March 31, 2003, of the total other
investment grade and non-investment grade mortgage-backed
securities, $42.5 million was collateralized by prime
loans, $11.1 million by subprime loans and
$2.8 million by manufactured housing loans.

Mortgage Servicing and Mortgage Servicing
Rights

In addition to its own loans, IndyMac serviced
$28.0 billion of mortgage loans owned by others at
March 31, 2003 with a weighted average coupon of 7.24% and
was the master servicer on $3.6 billion of mortgage loans
serviced by others. In comparison, IndyMac serviced
$25.8 billion of mortgage loans and was the master servicer
on $4.9 billion of mortgage loans at December 31,
2002. The table below shows the activity in the master and
primary servicing portfolios during the quarter ended
March 31, 2003.

|                                              |  |                       |       |         |  |   |        |  
|--------------------------------------------- |  | --------------------- | ----- | ------- |  | - | ------ | -
|                                              |  | Master                |       | Primary
|                                              |  |                       |       |        
|                                              |  |                      
|                                              |  | (Dollars in millions)
|Unpaid principal balance at December 31, 2002 |  | $                     | 4,869 |         |  | $ | 25,819 |  
|Additions                                     |  |                       |      |         |  |   | 5,321  |  
|Clean-up calls exercised                      |  |                       | (422  | )       |  |   | (129   | )
|Loan payments and prepayments                 |  |                       | (800  | )       |  |   | (2,782 | )
|                                              |  |                       |       |         |  |   |        |  
|Unpaid principal balance at March 31, 2003    |  | $                     | 3,647 |         |  | $ | 28,229 |  
|                                              |  |                       |       |         |  |   |        |  

MSRs related to these servicing portfolios
totaled $343.5 million as of March 31, 2003 and
$300.5 million as of December 31, 2002, reflecting an
increase of $43.0 million. The table below shows the
activity in MSRs.

18



---



##### 



|                                                               |  |                        |         |           |  |              |         |   |  |   |         |  
|-------------------------------------------------------------- |  | ---------------------- | ------- | --------- |  | ------------ | ------- | - |  | - | ------- | -
|                                                               |  |                       
|                                                               |  | Three Months Ended    
|                                                               |  |                       
|                                                               |  | March 31,              |         | March 31, |  | December 31,
|                                                               |  | 2003                   |         | 2002      |  | 2002        
|                                                               |  |                        |         |           |  |             
|                                                               |  |                       
|                                                               |  | (Dollars in thousands)
|Balance at beginning of period                                 |  | $                      | 300,539 |           |  | $            | 321,316 |   |  | $ | 278,041 |  
|Additions                                                      |  |                        | 67,742  |           |  |              | 72,668  |   |  |   | 52,651  |  
|Transfers to AAA-rated and agency interest-only
    securities |  |                        |        |           |  |              | (2,598  | ) |  |   | (9,083  | )
|Clean-up calls exercised                                       |  |                        | (2,475  | )         |  |              |        |   |  |   | (685    | )
|Scheduled amortization                                         |  |                        | (21,150 | )         |  |              | (18,853 | ) |  |   | (16,759 | )
|Provision/(benefit) for valuation/ impairment                  |  |                        | (1,112  | )         |  |              | 17,598  |   |  |   | (3,626  | )
|                                                               |  |                        |         |           |  |              |         |   |  |   |         |  
|Balance at end of period                                       |  | $                      | 343,544 |           |  | $            | 390,131 |   |  | $ | 300,539 |  
|                                                               |  |                        |         |           |  |              |         |   |  |   |         |  

Each quarter, we evaluate the MSRs for impairment
in accordance with SFAS 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities.We first stratify our MSRs based on
predominant risk characteristics, including primary versus
master servicing, underlying loan type, interest rate type, and
interest rate band. Then, for each stratum, we determine the
fair value of MSRs using our valuation models, which are
periodically validated by third party opinions of value. If the
carrying value exceeds the fair value by individual stratum, a
valuation allowance is recorded as a charge to service fee
income in current earnings. However, if such impairment is
determined to be other-than-temporary and the recoverability of
the value is remote, we recognize a direct write-down. Unlike a
valuation allowance, a direct write-down permanently reduces the
carrying value of the MSR asset and the related valuation
allowance, precluding subsequent reversals. For the three months
ended March 31, 2003, we recorded a direct write-down of
MSRs totaling $102.7 million, which was written off against
the valuation allowance previously provided.

AAA-Rated and Agency Interest-Only
Securities and Residuals

We evaluate the carrying value of our AAA-rated
and agency interest-only securities and residual securities by
discounting estimated net future cash flows. For these
securities, estimated net future cash flows are primarily based
on assumptions related to prepayment speeds, in addition to
expected credit loss assumptions on the residual and
non-investment grade securities.

19



---



##### 



A summary of the activity in the AAA-rated and
agency interest-only securities and residual securities
portfolios for the three months ended March 31, 2003 and
2002 and for the three months ended December 31, 2002,
follows:

|                                   |                                           |                        |   |           |   |              |   |         |   |  |   |         |  
|---------------------------------- | ----------------------------------------- | ---------------------- | - | --------- | - | ------------ | - | ------- | - |  | - | ------- | -
|                                   |                                           |                       
|                                   |                                           | Three Months Ended    
|                                   |                                           |                       
|                                   |                                           | March 31,              |   | March 31, |   | December 31,
|                                   |                                           | 2003                   |   | 2002      |   | 2002        
|                                   |                                           |                        |   |           |   |             
|                                   |                                           |                       
|                                   |                                           | (Dollars in thousands)
|AAA-rated interest-only securities |                                           |                        |   |           |   |              |   |         |   |  |   |        
|                                   | Beginning balance                         |                        | $ | 187,060   |   |              | $ | 211,104 |   |  | $ | 189,524 |  
|                                   | Retained investments from securitizations |                        |   | 13,416    |   |              |   |        |   |  |   | 17,873  |  
|                                   | Transfers from MSRs                       |                        |   |          |   |              |   | 2,598   |   |  |   | 9,083   |  
|                                   | Clean-up calls exercised                  |                        |   | (12,048   | ) |              |   |        |   |  |   | (4,227  | )
|                                   | Cash received, net of accretion           |                        |   | (14,071   | ) |              |   | (10,084 | ) |  |   | (14,840 | )
|                                   | Valuation losses before hedges            |                        |   | (18,145   | ) |              |   | (10,686 | ) |  |   | (10,353 | )
|                                   |                                           |                        |   |           |   |              |   |         |   |  |   |        
|                                   | Ending balance                            |                        | $ | 156,212   |   |              | $ | 192,932 |   |  | $ | 187,060 |  
|                                   |                                           |                        |   |           |   |              |   |         |   |  |   |        
|Residual securities                |                                           |                        |   |           |   |              |   |         |   |  |   |        
|                                   | Beginning balance                         |                        | $ | 78,740    |   |              | $ | 43,123  |   |  | $ | 94,233  |  
|                                   | Retained investments from securitizations |                        |   | 14,626    |   |              |   | 14,056  |   |  |   | 4,889   |  
|                                   | Sales                                     |                        |   | (10,525   | ) |              |   |        |   |  |   | (19,000 | )
|                                   | Cash received, net of accretion           |                        |   | (6,865    | ) |              |   | (2,823  | ) |  |   | (5,556  | )
|                                   | Valuation gains before hedges             |                        |   | 2,022     |   |              |   | 1,039   |   |  |   | 4,174   |  
|                                   |                                           |                        |   |           |   |              |   |         |   |  |   |        
|                                   | Ending balance                            |                        | $ | 77,998    |   |              | $ | 55,395  |   |  | $ | 78,740  |  
|                                   |                                           |                        |   |           |   |              |   |         |   |  |   |        

Valuation of Servicing-Related
Assets

MSRs, AAA-rated and agency interest-only
securities and residual securities are recorded at fair market
value. MSRs are further subject to lower of cost or market
limitations. Relevant information and assumptions

20



---



##### 



used to value the Companys servicing
related assets and residual securities at March 31, 2003
and December 31, 2002 are shown below.


|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |   | 
|--------------------------------------------- | --------------------------------------------- | ------ | ------- | --------------------- |  | --------- | ---------- | ---------------------- |  | ---------- | ---- | -------- |  | ---------- | ---- | --------- |  | ------------ | ---- | - |  |  | ---- |  |  |  | ---- | - |  |  | ---- | - |  |  | --- | - | 
|                                              |                                               |        |         |                      
|                                              |                                               | Actual |         | Valuation Assumptions
|                                              |                                               |        |         |                      
|                                              |                                               |        |         | Gross Wtd.            |  | Servicing |            | 3-Month                |  | Weighted   |      | Lifetime |  |            |      | Remaining
|                                              |                                               | Book   |         | Collateral            |  | Average   |            | Fee/Interest           |  | Prepayment |      | Average  |  | Prepayment |      | Discount  |  | Cumulative  
|                                              |                                               | Value  |         | Balance               |  | Coupon    |            | Strip                  |  | Speeds     |      | Multiple |  | Speeds(1)  |      | Yield     |  | Loss Rate(2)
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |             
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |          
|                                              |                                               |        |         |                       |  |           |            | (Dollars in thousands) |  |            |      |          |  |            |      |          
|March 31, 2003                                |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|AAA-rated and agency interest-only securities |                                               | $      | 156,212 |                       |  | $         | 12,924,037 |                        |  |            | 7.68 | %        |  |            | 0.51 | %         |  |              | 38.8 | % |  |  | 2.37 |  |  |  | 21.9 | % |  |  | 8.9  | % |  |  | N/A |  
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|Prime residual securities                     |                                               | $      | 42,703  |                       |  | $         | 3,537,589  |                        |  |            | 7.27 | %        |  |            | 1.46 | %         |  |              | 38.5 | % |  |  | 0.83 |  |  |  | 21.8 | % |  |  | 15.2 | % |  |  | 0.6 | %
|Sub-prime residual securities                 |                                               |        | 35,295  |                       |  | $         | 1,636,487  |                        |  |            | 9.34 | %        |  |            | 4.04 | %         |  |              | 34.0 | % |  |  | 0.53 |  |  |  | 33.3 | % |  |  | 22.9 | % |  |  | 2.6 | %
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|                                              | Total noninvestment grade residual securities |        | $       | 77,998                |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |   | 
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|Master servicing(3)                           |                                               | $      | 10,698  |                       |  | $         | 3,646,713  |                        |  |            | 8.19 | %        |  |            | 0.10 | %         |  |              | 52.2 | % |  |  | 2.94 |  |  |  | 24.0 | % |  |  | 11.3 | % |  |  | N/A |  
|Primary servicing(4)                          |                                               |        | 332,846 |                       |  | $         | 28,229,278 |                        |  |            | 7.24 | %        |  |            | 0.34 | %         |  |              | 39.3 | % |  |  | 3.65 |  |  |  | 21.2 | % |  |  | 9.4  | % |  |  | N/A |  
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|                                              | Total MSRs                                    |        | $       | 343,544               |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |   | 
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|                                             
|December 31, 2002                             |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|AAA-rated and agency interest-only securities |                                               | $      | 187,060 |                       |  | $         | 14,214,229 |                        |  |            | 7.77 | %        |  |            | 0.53 | %         |  |              | 38.5 | % |  |  | 2.48 |  |  |  | 23.6 | % |  |  | 8.7  | % |  |  | N/A |  
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|Prime residual securities                     |                                               | $      | 33,400  |                       |  | $         | 2,968,794  |                        |  |            | 7.51 | %        |  |            | 1.44 | %         |  |              | 35.5 | % |  |  | 0.78 |  |  |  | 18.9 | % |  |  | 15.2 | % |  |  | 0.7 | %
|Sub-prime residual securities                 |                                               |        | 45,340  |                       |  | $         | 1,968,041  |                        |  |            | 9.54 | %        |  |            | 4.21 | %         |  |              | 30.3 | % |  |  | 0.55 |  |  |  | 32.1 | % |  |  | 27.1 | % |  |  | 2.8 | %
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|                                              | Total noninvestment grade residual securities |        | $       | 78,740                |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |   | 
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|Master servicing(3)                           |                                               | $      | 14,582  |                       |  | $         | 4,868,804  |                        |  |            | 8.26 | %        |  |            | 0.10 | %         |  |              | 53.3 | % |  |  | 2.99 |  |  |  | 22.3 | % |  |  | 11.3 | % |  |  | N/A |  
|Primary servicing(4)                          |                                               |        | 285,957 |                       |  | $         | 25,819,447 |                        |  |            | 7.52 | %        |  |            | 0.33 | %         |  |              | 40.4 | % |  |  | 3.37 |  |  |  | 22.0 | % |  |  | 9.5  | % |  |  | N/A |  
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  
|                                              | Total MSRs                                    |        | $       | 300,539               |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |   | 
|                                              |                                               |        |         |                       |  |           |            |                        |  |            |      |          |  |            |      |           |  |              |      |   |  |  |      |  |  |  |      |   |  |  |      |   |  |  |     |  



---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Assumed prepayment speeds are higher in the short
    term and lower in the long term based on the market forward
    curve for interest rates rising over the life of the asset. The
    assumed 3-month prepayment speeds at March 31, 2003 were
    46.6%, 36.1%, and 35.7% for AAA-rated and agency interest-only
    securities, prime residual securities, and subprime residuals,
    respectively, and 54.3% and 42.7% for master and primary
    servicing, respectively.
|   
|(2) | As a percentage of the original pool balance, the
    actual cumulative loss rate to date totaled 0.10% and 1.05% for
    prime and subprime residuals, respectively, at March 31,
    2003.                                                                                                                                                                                                                                                                                      
|   
|(3) | The master servicing portfolio includes loans
    that are part of the primary servicing portfolio with an unpaid
    principal balance of $2.0 billion at March 31, 2003.                                                                                                                                                                                                                                                                                                        
|   
|(4) | Loans sold with servicing retained only. Does not
    include a total of $3.0 billion in IndyMac-owned loans and
    loans subserviced for others on an interim basis at
    March 31, 2003.                                                                                                                                                                                                                                                                                      

The lifetime prepayment speeds represent the
annualized constant prepayment rate (CPR) we
estimate for the remaining life of the collateral supporting the
asset. For MSRs and AAA-rated and agency interest-only
securities, we project prepayment rates using four-factor
prepayment models which incorporate relative weighted average
note rate, seasoning, seasonality and burn-out of the pool of
loans relative to expectations of future rates implied by the
market forward LIBOR/swap curve.

The weighted average multiple for MSRs, AAA-rated
and agency interest-only and residual securities represents the
book value divided by the product of collateral balance and
servicing fee/interest strip. While the weighted average life of
such assets is a function of the undiscounted cash flows, the
multiple is a function of the discounted cash flows. With regard
to AAA-rated and agency interest-only securities, the
marketplace frequently uses calculated multiples to assess the
overall impact valuation assumptions have on value. Collateral
type, coupon, loan age and the size of the interest strip must
be considered when comparing these multiples.

21



---



##### 



The assumptions for discount yield and lifetime
prepayment speeds at March 31, 2003 remain comparable to those
of December 31, 2002 due to the fact that, while interest
rates fluctuated significantly throughout the quarter, the
period end rates were relatively flat and actual three-month
prepayment speeds were consistent from quarter to quarter.
Lifetime prepayment assumptions for AAA-rated and agency
interest-only and primary servicing declined slightly during the
first quarter of 2003 compared to the fourth quarter of 2002
reflecting the decline in gross weighted average coupon for each
of the portfolios.

Hedging Interest Rate Risk on
Servicing-Related Assets

With respect to the investment in
servicing-related assets (AAA-rated and agency interest-only
securities, non-investment grade residual securities and MSRs),
the Company is exposed to interest rate risk as a result of
other than predicted prepayment of loans. Our Investment
Portfolio Group is responsible for the management of interest
rate and prepayment risks in the investment portfolio, subject
to policies and procedures established by, and oversight from,
our management level Asset and Liability Committee
(ALCO) and Board of Directors level ALCO. To hedge
our investments in servicing-related assets, we use several
strategies, including investing in AAA-rated principal-only
securities, buying and/or selling mortgage-backed or U.S.
Treasury securities, futures, floors, swaps, or options,
depending on several factors. We utilize hedging instruments to
reduce our exposure to interest rate risk, not to speculate on
the direction of market interest rates.

Temporary impairment as a result of accelerated
prepayments on the servicing-related assets and residual
securities totaled $17.2 million in the first quarter of
2003. These losses were offset by $10.4 million of gains on
trading securities and derivative instruments utilized to hedge
the interest rate risk on the servicing-related assets and
residual securities and $2.5 million of net interest income
earned on the hedging instruments.

The following breaks out the components of
service fee income and the gain on mortgage-backed securities,
net.

|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |         |       | 
|----------------------------- | -------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------- | - | --------- | ------ | ------------ | - | ------- | ------ | - | - | ------- | ----- | 
|                              |                                                                                                                      |                                                         
|                              |                                                                                                                      | Three Months Ended                                      
|                              |                                                                                                                      |                                                         
|                              |                                                                                                                      | March 31,                                                |   | March 31, |        | December 31,
|                              |                                                                                                                      | 2003                                                     |   | 2002      |        | 2002        
|                              |                                                                                                                      |                                                          |   |           |        |             
|                              |                                                                                                                      |                                                         
|                              |                                                                                                                      | (Dollars in thousands)                                  
|Service fee income            |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|                              | Gross service fee income                                                                                             |                                                          | $ | 24,057    |        |              | $ | 26,080  |        |   | $ | 23,117  |      
|                              | Amortization                                                                                                         |                                                          |   | (21,150   | )      |              |   | (18,853 | )      |   |   | (16,759 | )    
|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|                              | Service fee income net of amortization                                                                               |                                                          |   | 2,907     |        |              |   | 7,227   |        |   |   | 6,358   |      
|                              | Valuation adjustments on MSRs                                                                                        |                                                          |   | (1,112    | )      |              |   | 17,598  |        |   |   | (3,626  | )    
|                              | Hedges on MSRs                                                                                                       |                                                          |   | 588       |        |              |   | (17,003 | )      |   |   | (1,355  | )    
|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|                              |                                                                                                                      | Total service fee income                                 |   | $         | 2,383  |              |   | $       | 7,822  |   |   | $       | 1,377 | 
|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|Net (loss) gain on securities |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|                              | Realized gain on available-for-sale securities                                                                       |                                                          | $ |          |        |              | $ | 2,620   |        |   | $ |        |      
|                              | Impairment on available-for-sale securities                                                                          |                                                          |   | (580      | )      |              |   | (500    | )      |   |   |        |      
|                              | Unrealized loss on AAA interest only and residual
    securities                                                     |                                                          |   | (16,123   | )      |              |   | (10,686 | )      |   |   | (7,922  | )    
|                              | Net gain on trading securities and other
    instruments used to hedge AAA interest only and residual
    securities |                                                          |   | 9,793     |        |              |   | 1,578   |        |   |   | 8,974   |      
|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        
|                              |                                                                                                                      | Total (loss) gain on mortgage-backed
    securities, net |   | $         | (6,910 | )            |   | $       | (6,988 | ) |   | $       | 1,052 | 
|                              |                                                                                                                      |                                                          |   |           |        |              |   |         |        |   |   |        

22



---



##### 



The following table summarizes the results of our
hedges of our servicing-related assets:

|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |         |        | 
|------------------------------------------------------- | -------------------------- | ---------------------- | ------- | --------- | ----- | ------------ | ------- | ------- | ----- | - | ------- | ------- | ------ | 
|                                                        |                            |                       
|                                                        |                            | Three Months Ended    
|                                                        |                            |                       
|                                                        |                            | March 31,              |         | March 31, |       | December 31,
|                                                        |                            | 2003                   |         | 2002      |       | 2002        
|                                                        |                            |                        |         |           |       |             
|                                                        |                            |                       
|                                                        |                            | (Dollars in thousands)
|Gross service fee income                                |                            | $                      | 24,057  |           |       | $            | 26,080  |         |       | $ | 23,117  |        
|Net interest income on residuals                        |                            |                        | 3,305   |           |       |              | 2,755   |         |       |   | 4,063   |        
|Net interest income on AAA interest only
    securities |                            |                        | 1,569   |           |       |              | 3,457   |         |       |   | 1,557   |        
|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |        
|                                                        | Subtotal                   |                        |         | 28,931    |       |              |         | 32,292  |       |   |         | 28,737  |       
|Amortization of MSRs                                    |                            |                        | (21,150 | )         |       |              | (18,853 | )       |       |   | (16,759 | )      
|                                                        | Net valuation gains/losses |                        |         | (17,235   | )     |              |         | 6,913   |       |   |         | (11,548 | )     
|                                                        | Subtotal                   |                        |         | (38,385   | )     |              |         | (11,940 | )     |   |         | (28,307 | )     
|Net interest income on cash hedges                      |                            |                        | 2,460   |           |       |              | 72      |         |       |   | 2,190   |        
|                                                        | Net hedge gains/losses     |                        |         | 10,381    |       |              |         | (15,425 | )     |   |         | 7,619   |       
|                                                        | Subtotal                   |                        |         | 12,841    |       |              |         | (15,353 | )     |   |         | 9,809   |       
|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |        
|                                                        |                            | Total                  |         | $         | 3,387 |              |         | $       | 4,999 |   |         | $       | 10,239 | 
|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |        
|Average balance                                         |                            | $                      | 553,290 |           |       | $            | 582,928 |         |       | $ | 572,894 |        
|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |        
|Return                                                  |                            |                        | 2.45    | %         |       |              | 3.43    | %       |       |   | 7.15    | %      
|                                                        |                            |                        |         |           |       |              |         |         |       |   |         |        

The decline in servicing related income during
the quarter is the result of reduced reinvestment income on the
cash flows during the period combined with higher levels of
compensating interest and increased amortization of the assets
due to unprecedented levels of prepayments.

Offsetting the reduction in servicing related
assets, we realized income on the sale of loans obtained through
our right as the Master Servicer for our various
securitizations, to call the securities when the outstanding
loan balance in the securitization trust declines to a specified
level, typically 10%, of the original balance. When the fair
value of remaining loans exceeds expected costs to exercise the
call, we will typically exercise our option. During the first
quarter 2003, we sold approximately $126 million of loans
acquired through clean-up call exercises for a pretax gain of
$6.7 million

Construction Lending

IndyMac provides construction financing for
individual consumers who are in the process of building their
own home (consumer construction) and for residential subdivision
developers (builder construction). With respect to consumer
construction, the primary product is a construction-to-permanent
residential mortgage loan. This product provides financing for
the 9-12 month term of construction and automatically
converts to a permanent mortgage loan at the end of
construction. As a result, this product represents a hybrid
activity between our portfolio lending activities and mortgage
banking activities. The Company earns net interest income during
the construction phase. When the loan converts to permanent
status the loan is transferred into the Companys pipeline
of mortgage loans held for sale. These loans are typically
fixed-rate loans. Consumer construction loan origination grew
10% over the quarter despite an industry slowdown in housing
starts attributed to severe weather conditions. This growth came
from the higher margin retail channel whose production share
rose from 23.7% to 31.4%. The units credit application
pipeline is also up nearly 16%, consistent with seasonal trends
and marketing efforts coming to fruition. Expenses were held
constant with the fourth quarter of 2002 improving the
groups efficiency ratio from 34.8% to 32.4%. Consumer
construction loans outstanding at March 31, 2003 were
$900.4 million, up 3% compared to the amount at
December 31, 2002.

With respect to builder construction loans, our
activities have been increasingly focused on those homebuilders
that provide our mortgage loans to their customers when they
sell the completed residence. New production is limited to eight
states for new commitments (California, Illinois, Nevada, Utah,
Arizona,

23



---



##### 



Colorado, Washington, and Oregon). Builder
construction loans are typically based on prime rates. Builder
construction loans outstanding at March 31, 2003 were
$508.6 million, up 5% compared to December 31, 2002.
However, the average outstanding commitment amount decreased by
$40.6 million due to pay-offs exceeding fundings and lower
disbursement rates during the first quarter of 2003 compared to
the fourth quarter of 2002.


The following tables present further information
on our construction loan portfolios.

|                                     |  |                    |           |                        |  |              |           |              |  |   |           |   |  |   |           |  
|------------------------------------ |  | ------------------ | --------- | ---------------------- |  | ------------ | --------- | ------------ |  | - | --------- | - |  | - | --------- | -
|                                     |  |                   
|                                     |  | Three Months Ended
|                                     |  |                   
|                                     |  |                    |           |                       
|                                     |  | March 31, 2003     |           | December 31, 2002     
|                                     |  |                    |           |                       
|                                     |  | Consumer           |           | Builder                |  | Consumer     |           | Builder     
|                                     |  | Construction       |           | Construction           |  | Construction |           | Construction
|                                     |  | Loans              |           | Loans                  |  | Loans        |           | Loans       
|                                     |  |                    |           |                        |  |              |           |             
|                                     |  |                    |           |                        |  |             
|                                     |  |                    |           | (Dollars in thousands) |  |             
|Construction loans                   |  | $                  | 900,428   |                        |  | $            | 508,604   |              |  | $ | 875,335   |   |  | $ | 482,408   |  
|Land and other mortgage loans        |  | $                  | 104,300   |                        |  | $            | 97,112    |              |  | $ | 81,885    |   |  | $ | 123,066   |  
|Outstanding commitments              |  | $                  | 1,644,366 |                        |  | $            | 1,063,589 |              |  | $ | 1,531,011 |   |  | $ | 1,104,160 |  
|Average construction loan commitment |  | $                  | 409       |                        |  | $            | 2,162     |              |  | $ | 415       |   |  | $ | 1,982     |  
|Non-performing loans                 |  |                    | 1.28      | %                      |  |              | 1.84      | %            |  |   | 1.08      | % |  |   | 2.92      | %
|Yield                                |  |                    | 6.95      | %                      |  |              | 6.94      | %            |  |   | 7.13      | % |  |   | 7.06      | %
|Fixed-rate loans                     |  |                    | 93        | %                      |  |              | 1         | %            |  |   | 94        | % |  |   | 1         | %
|Adjustable-rate loans                |  |                    | 0         | %                      |  |              | 97        | %            |  |   | 0         | % |  |   | 96        | %
|Hybrid adjustable-rate loans         |  |                    | 7         | %                      |  |              | 2         | %            |  |   | 6         | % |  |   | 3         | %

Additional Information as of March 31,
2003

|                                |                               |              |     |     |   |                               |                            |  |     |     |  
|------------------------------- | ----------------------------- | ------------ | --- | --- | - | ----------------------------- | -------------------------- |  | --- | --- | -
|                                |                               | Consumer     |     |     |   | Builder                      
|                                |                               | Construction |     |     |   | Construction                 
|                                |                               | Loans        |     |     |   | Loans                        
|                                |                               |              |     |     |   |                              
|Average loan to value ratio (1) |                               |              | 73  | %   |   |                               |                            |  | 71  | %  
|Average FICO score (2)          |                               |              | 707 |     |   |                               |                            |  | N/A |    
|Geographic distribution(3)      |                               |              |     |     |   |                               |                            |  |     |    
|                                | Southern California           |              |     | 25  | % |                               | Southern California        |  |     | 36  | %
|                                | Northern California           |              |     | 19  | % |                               | Northern California        |  |     | 24  | %
|                                | New York                      |              |     | 7   | % |                               | Illinois                   |  |     | 17  | %
|                                | Hawaii                        |              |     | 5   | % |                               | Nevada                     |  |     | 2   | %
|                                | Florida                       |              |     | 5   | % |                               | Texas                      |  |     | 2   | %
|                                | Colorado                      |              |     | 3   | % |                               | Colorado                   |  |     | 2   | %
|                                | Other (each individually< 2%) |              |     | 36  | % |                               | North Carolina             |  |     | 2   | %
|                                |                               |              |     |     |   | Florida                       |                            |  | 2   | %  
|                                |                               |              |     |     |   | Other (each individually< 2%) |                            |  | 13  | %  
|                                |                               |              |     |     |   |                               |                            |  |     |    
|                                | Total Consumer Construction   |              |     | 100 | % |                               | Total Builder Construction |  |     | 100 | %
|                                |                               |              |     |     |   |                               |                            |  |     |    



---



|    |                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The average loan to value ratio is based on the
    estimated appraised value of the completed project compared to
    the commitment amount at March 31, 2003.  
|   
|(2) | FICO scores are not calculated for corporate
    entities and, therefore, are not applicable to the builder
    construction portfolio.                          
|   
|(3) | Geographic distribution is based on outstanding
    balances. Some projects are continuing to be built out in states
    in which we no longer solicit new loans.

24



---



##### 



For information related to the Companys
balance of non-performing assets and related credit reserves,
see discussion in Credit Risk and Reserves at page
29.

HELOC Portfolio

The following table presents information on our
HELOCs as of and for the three months ended March 31, 2003
and December 31, 2002. All HELOC loans are adjustable rate
loans and indexed to the prime rate.

|                           |  |                        |         |              |  |          |         |   |  |  |    |   
|-------------------------- |  | ---------------------- | ------- | ------------ |  | -------- | ------- | - |  |  | -- | --
|                           |  |                       
|                           |  | Three Months Ended    
|                           |  |                       
|                           |  | March 31,              |         | December 31, |  | Variance
|                           |  | 2003                   |         | 2002         |  | Percent 
|                           |  |                        |         |              |  |         
|                           |  |                       
|                           |  | (Dollars in thousands)
|Outstanding balance        |  | $                      | 391,002 |              |  | $        | 312,881 |   |  |  | 25 | % 
|Outstanding commitments(1) |  | $                      | 586,192 |              |  | $        | 459,537 |   |  |  | 28 | % 
|Average spread over prime  |  |                        | 2.02    | %            |  |          | 1.78    | % |  |  | 13 | % 
|Average FICO score         |  |                        | 706     |              |  |          | 711     |   |  |  | (1 | )%
|Average CLTV ratio(2)      |  |                        | 78      | %            |  |          | 78      | % |  |  | 0  | % 

Additional Information as of March 31,
2003

|             |       |                        |         |              |  |                |    |         |  |             |      |   |  |  |     |  |  |  |      |   | 
|------------ | ----- | ---------------------- | ------- | ------------ |  | -------------- | -- | ------- |  | ----------- | ---- | - |  |  | --- |  |  |  | ---- | - | 
|             |       | Total                  |         | Average Loan |  |                |    |         |  | 30+ Days   
|             |       | Outstanding            |         | Commitment   |  | Average Spread |    | Average |  | Delinquency
|CLTV         |       | Balance                |         | Balance      |  | Over Prime     |    | FICO    |  | Percentage 
|             |       |                        |         |              |  |                |    |         |  |            
|             |       |                       
|             |       | (Dollars in thousands)
|>96% &< 100% |       | $                      | 13,575  |              |  | $              | 46 |         |  |             | 4.26 | % |  |  | 720 |  |  |  | 1.06 | %
|>91% &< 95%  |       |                        | 63,789  |              |  |                | 50 |         |  |             | 3.40 | % |  |  | 709 |  |  |  | 0.07 | %
|>81% &< 90%  |       |                        | 151,273 |              |  |                | 48 |         |  |             | 2.29 | % |  |  | 690 |  |  |  | 0.33 | %
|>71% &< 80%  |       |                        | 83,456  |              |  |                | 80 |         |  |             | 1.06 | % |  |  | 708 |  |  |  | 0.87 | %
|<70%         |       |                        | 78,909  |              |  |                | 83 |         |  |             | 1.04 | % |  |  | 722 |  |  |  | 0.07 | %
|             |       |                        |         |              |  |                |    |         |  |             |      |   |  |  |     |  |  |  |      |  
|             | Total |                        | $       | 391,002      |  |                |    |         |  |             |      |   |  |  |     |  |  |  |      |   | 
|             |       |                        |         |              |  |                |    |         |  |             |      |   |  |  |     |  |  |  |      |  



---



|    |                                                                                       
|--- | --------------------------------------------------------------------------------------
|(1) | On funded loans.                                                                      
|   
|(2) | The CLTV combines the loan to value on both the
    first mortgage loan and the HELOC.

NET INTEREST INCOME

The following table sets forth information
regarding our consolidated average balance sheets (Mortgage
Bank, Investment Portfolio and Consumer Bank are combined),
along with the total dollar amounts of interest income and
interest expense and the weighted average interest rates for the
periods presented. Average

25



---



##### 



balances are calculated on a daily basis.
Non-performing loans are included in the average balances for
the periods presented. The allowance for loan losses is excluded
from the average loan balances.


|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |      |  
|-------------------------------------------------------- | ------------------------------------------ | ---------------------- | --------- | -------------- |  | ----------------- | ------ | ------- |  | -------- | ---- | ----- | - | ------- | --------- | --------- |  | ----- | ------ | ------- |  |  | ---- | ---- | - | - | --------- | --------- |  | - | ------ | ------- |  |  | ---- | ---- | -
|                                                         |                                            |                       
|                                                         |                                            | Three Months Ended    
|                                                         |                                            |                       
|                                                         |                                            |                        |           |                |  |                  
|                                                         |                                            | March 31, 2003         |           | March 31, 2002 |  | December 31, 2002
|                                                         |                                            |                        |           |                |  |                  
|                                                         |                                            | Average                |           |                |  | Yield             |        | Average |  |          |      | Yield |   | Average |           |           |  | Yield
|                                                         |                                            | Balance                |           | Interest       |  | Rate              |        | Balance |  | Interest |      | Rate  |   | Balance |           | Interest  |  | Rate 
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |      
|                                                         |                                            |                       
|                                                         |                                            | (Dollars in thousands)
|Securities                                               |                                            | $                      | 1,920,645 |                |  | $                 | 20,961 |         |  |          | 4.43 | %     |   | $       | 1,556,025 |           |  | $     | 28,881 |         |  |  | 7.53 | %    |   | $ | 2,133,366 |           |  | $ | 26,004 |         |  |  | 4.84 | %   
|Loans held for sale                                      |                                            |                        | 2,867,547 |                |  |                   | 45,201 |         |  |          | 6.39 | %     |   |         | 2,063,096 |           |  |       | 36,744 |         |  |  | 7.22 | %    |   |   | 2,762,319 |           |  |   | 42,988 |         |  |  | 6.17 | %   
|Mortgage loans held for investment                       |                                            |                        | 2,759,900 |                |  |                   | 35,962 |         |  |          | 5.28 | %     |   |         | 1,706,945 |           |  |       | 30,898 |         |  |  | 7.34 | %    |   |   | 1,841,949 |           |  |   | 26,438 |         |  |  | 5.69 | %   
|Builder construction and income property                 |                                            |                        | 570,886   |                |  |                   | 9,720  |         |  |          | 6.91 | %     |   |         | 624,657   |           |  |       | 11,732 |         |  |  | 7.62 | %    |   |   | 576,243   |           |  |   | 10,292 |         |  |  | 7.09 | %   
|Consumer construction                                    |                                            |                        | 839,772   |                |  |                   | 14,396 |         |  |          | 6.95 | %     |   |         | 706,279   |           |  |       | 13,645 |         |  |  | 7.84 | %    |   |   | 788,536   |           |  |   | 14,166 |         |  |  | 7.13 | %   
|Investment in Federal Home Loan Bank stock and
    other |                                            |                        | 181,268   |                |  |                   | 1,957  |         |  |          | 4.38 | %     |   |         | 139,330   |           |  |       | 1,782  |         |  |  | 5.19 | %    |   |   | 155,370   |           |  |   | 1,801  |         |  |  | 4.60 | %   
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|                                                         | Total interest-earning assets              |                        |           | 9,140,018      |  |                   |        | 128,197 |  |          |      | 5.69  | % |         |           | 6,796,332 |  |       |        | 123,682 |  |  |      | 7.38 | % |   |           | 8,257,783 |  |   |        | 121,689 |  |  |      | 5.85 | %
|Other                                                    |                                            |                        | 894,643   |                |  |                   |        |         |  |          |      |       |   |         | 672,174   |           |  |       |        |         |  |  |      |      |   |   | 799,880   |           |  |   |        |         |  |  |      |     
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|                                                         | Total assets                               |                        | $         | 10,034,661     |  |                   |        |         |  |          |      |       |   |         | $         | 7,468,506 |  |       |        |         |  |  |      |      |   |   | $         | 9,057,663 |  |   |        |         |  |  |      |      |  
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|Interest-bearing deposits                                |                                            | $                      | 2,736,822 |                |  |                   | 21,687 |         |  |          | 3.21 | %     |   | $       | 2,962,747 |           |  |       | 31,308 |         |  |  | 4.29 | %    |   | $ | 2,572,244 |           |  |   | 23,063 |         |  |  | 3.56 | %   
|Advances from Federal Home Loan Bank                     |                                            |                        | 2,709,008 |                |  |                   | 25,558 |         |  |          | 3.83 | %     |   |         | 1,956,627 |           |  |       | 24,389 |         |  |  | 5.06 | %    |   |   | 2,423,828 |           |  |   | 25,619 |         |  |  | 4.19 | %   
|Trust preferred securities                               |                                            |                        | 116,866   |                |  |                   | 2,763  |         |  |          | 9.59 | %     |   |         | 116,333   |           |  |       | 2,756  |         |  |  | 9.61 | %    |   |   | 116,730   |           |  |   | 2,761  |         |  |  | 9.38 | %   
|Other borrowings                                         |                                            |                        | 2,695,541 |                |  |                   | 15,164 |         |  |          | 2.28 | %     |   |         | 1,098,045 |           |  |       | 11,475 |         |  |  | 4.24 | %    |   |   | 2,273,329 |           |  |   | 14,289 |         |  |  | 2.49 | %   
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|                                                         | Total interest-bearing liabilities         |                        |           | 8,258,237      |  |                   |        | 65,172  |  |          |      | 3.20  | % |         |           | 6,133,752 |  |       |        | 69,928  |  |  |      | 4.62 | % |   |           | 7,386,131 |  |   |        | 65,732  |  |  |      | 3.53 | %
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|Other                                                    |                                            |                        | 906,201   |                |  |                   |        |         |  |          |      |       |   |         | 470,100   |           |  |       |        |         |  |  |      |      |   |   | 818,410   |           |  |   |        |         |  |  |      |     
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|                                                         | Total liabilities                          |                        |           | 9,164,438      |  |                   |        |         |  |          |      |       |   |         |           | 6,603,852 |  |       |        |         |  |  |      |      |   |   |           | 8,204,541 |  |   |        |         |  |  |      |      |  
|                                                         | Shareholders equity                       |                        |           | 870,223        |  |                   |        |         |  |          |      |       |   |         |           | 864,654   |  |       |        |         |  |  |      |      |   |   |           | 853,122   |  |   |        |         |  |  |      |      |  
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|                                                         | Total liabilities and shareholders equity |                        | $         | 10,034,661     |  |                   |        |         |  |          |      |       |   |         | $         | 7,468,506 |  |       |        |         |  |  |      |      |   |   | $         | 9,057,663 |  |   |        |         |  |  |      |      |  
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|Net interest income                                      |                                            |                        |           |                |  | $                 | 63,025 |         |  |          |      |       |   |         |           |           |  | $     | 53,754 |         |  |  |      |      |   |   |           |           |  | $ | 55,957 |         |  |  |      |     
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|Net interest spread                                      |                                            |                        |           |                |  |                   |        |         |  |          | 2.49 | %     |   |         |           |           |  |       |        |         |  |  | 2.76 | %    |   |   |           |           |  |   |        |         |  |  | 2.32 | %   
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     
|Net interest margin                                      |                                            |                        |           |                |  |                   |        |         |  |          | 2.80 | %     |   |         |           |           |  |       |        |         |  |  | 3.21 | %    |   |   |           |           |  |   |        |         |  |  | 2.69 | %   
|                                                         |                                            |                        |           |                |  |                   |        |         |  |          |      |       |   |         |           |           |  |       |        |         |  |  |      |      |   |   |           |           |  |   |        |         |  |  |      |     

During 2002, the Company experienced spread
compression as a result of the impact accelerated prepayment
activity had on asset yield relative to a liability base which
did not reprice as quickly. The spread has improved during the
first quarter of 2003 compared to the fourth quarter of 2002 due
to an increase in yields on held for sale loans attributable to
mix, the re-pricing of interest-bearing liabilities to lower
rates and the change in funding mix. In the first quarter of
2003, the Company repriced approximately $282 million of
higher cost certificates of deposit to lower coupon rate, and
shifted a portion of its borrowings from fixed-rate advances to
overnight advances. At March 31, 2003, fixed-rate Federal
Home Loan Bank of San Francisco (FHLB) advances
accounted for 60% of the total borrowings as compared to 64% at
December 31, 2002. The impact of the reduced cost of funds
was partially offset by the decrease in yields across most loan
and securities portfolios due to high prepayment speeds and the
addition of mortgage loans for investment at lower coupon rates.

The dollar amounts of interest income and
interest expense fluctuate depending upon changes in the average
balances and interest rates of interest-earning assets and
interest-bearing liabilities. The following table details
changes attributable to (i) changes in volume (changes in
average outstanding balances

26



---



##### 



multiplied by the prior periods rate),
(ii) changes in the rate (changes in the average interest
rate multiplied by the prior periods volume), and
(iii) changes in rate/volume (mix) (changes in
rates times the changes in volume).


|                                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |        |  
|-------------------------------------------------------- | ---------------------- | ------------------------------------------ | ------ | ------ |  | --- | ------- | ------------ | - | - | ------ | ------- | - | - | ------ | ------ | -
|                                                         |                        |                                           
|                                                         |                        | Three Months Ended March 31, 2003 vs. 2002
|                                                         |                        |                                           
|                                                         |                        |                                           
|                                                         |                        | Increase/(Decrease) Due to                
|                                                         |                        |                                           
|                                                         |                        | Volume                                     |        | Rate   |  | Mix |         | Total Change
|                                                         |                        |                                            |        |        |  |     |         |             
|                                                         |                        |                                           
|                                                         |                        | (Dollars in thousands)                    
|Interest income                                          |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       
|Mortgage-backed securities                               |                        | $                                          | 6,768  |        |  | $   | (11,899 | )            |   | $ | (2,788 | )       |   | $ | (7,920 | )     
|Loans held for sale                                      |                        |                                            | 14,327 |        |  |     | (4,223  | )            |   |   | (1,647 | )       |   |   | 8,457  |       
|Mortgage loans held for investment                       |                        |                                            | 19,061 |        |  |     | (8,657  | )            |   |   | (5,340 | )       |   |   | 5,064  |       
|Builder construction and income property                 |                        |                                            | (1,010 | )      |  |     | (1,096  | )            |   |   | 94     |         |   |   | (2,012 | )     
|Consumer construction                                    |                        |                                            | 2,579  |        |  |     | (1,538  | )            |   |   | (290   | )       |   |   | 751    |       
|Investment in Federal Home Loan Bank stock and
    other |                        |                                            | 536    |        |  |     | (277    | )            |   |   | (84    | )       |   |   | 175    |       
|                                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       
|                                                         | Total interest income  |                                            |        | 42,260 |  |     |         | (27,690      | ) |   |        | (10,055 | ) |   |        | 4,515  |  
|Interest expense                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       
|Interest-bearing deposits                                |                        |                                            | (2,387 | )      |  |     | (7,831  | )            |   |   | 597    |         |   |   | (9,621 | )     
|Advances from Federal Home Loan Bank                     |                        |                                            | 9,378  |        |  |     | (5,929  | )            |   |   | (2,280 | )       |   |   | 1,169  |       
|Trust preferred securities                               |                        |                                            | 13     |        |  |     | (6      | )            |   |   | 0      |         |   |   | 6      |       
|Other borrowings                                         |                        |                                            | 16,694 |        |  |     | (5,298  | )            |   |   | (7,707 | )       |   |   | 3,689  |       
|                                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       
|                                                         | Total interest expense |                                            |        | 23,698 |  |     |         | (19,064      | ) |   |        | (9,390  | ) |   |        | (4,756 | )
|                                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       
|                                                         | Net interest income    |                                            | $      | 18,562 |  |     | $       | (8,626       | ) |   | $      | (665    | ) |   | $      | 9,271  |  
|                                                         |                        |                                            |        |        |  |     |         |              |   |   |        |         |   |   |        |       

OVERALL INTEREST RATE RISK
MANAGEMENT

In addition to our hedging activities to mitigate
the interest rate risk in our pipeline of mortgage loans held
for sale and our investment in servicing-related assets, we
perform extensive overall interest rate risk analyses. The
primary measurement tool used to evaluate interest rate risk
over the comprehensive balance sheet is a net portfolio value
(NPV) analysis that simulates the effects changes in
interest rates have on the fair value of shareholders
equity.

The following table sets forth the NPV and change
in NPV of the Bank that we estimate might result from a 100
basis point change in interest rates as of March 31, 2003
and December 31, 2002. IndyMacs NPV

27



---



##### 



model has been built to focus on the Bank alone
as the $109.5 million of assets at the Parent Company have
relatively little interest rate risk exposure.


|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |           | 
|------------------------------------------- | ----------------- | ---------------------- | --------- | ------------------- |  | -------- | --------- | ------------------- |  | -------- | --------- | --------- |  | - | --------- | --------- |  | - | --------- | --------- |  | - | --------- | --------- | 
|                                            |                   |                        |           |                    
|                                            |                   | March 31, 2003         |           | December 31, 2002  
|                                            |                   |                        |           |                    
|                                            |                   |                        |           |                     |  |          |           |                    
|                                            |                   |                        |           | Effect of Change in |  |          |           | Effect of Change in
|                                            |                   |                        |           | Interest Rates      |  |          |           | Interest Rates     
|                                            |                   |                        |           |                     |  |          |           |                    
|                                            |                   | Fair                   |           | Decrease            |  | Increase |           | Fair                |  | Decrease |           | Increase 
|                                            |                   | Value                  |           | 100 bps             |  | 100 bps  |           | Value               |  | 100 bps  |           | 100 bps  
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |          
|                                            |                   |                       
|                                            |                   | (Dollars in thousands)
|Cash and cash equivalents                   |                   | $                      | 130,237   |                     |  | $        | 130,237   |                     |  | $        | 130,237   |           |  | $ | 196,589   |           |  | $ | 196,589   |           |  | $ | 196,589   |          
|Mortgage-backed and U.S Treasury securities |                   |                        | 1,607,399 |                     |  |          | 1,588,035 |                     |  |          | 1,613,818 |           |  |   | 2,292,250 |           |  |   | 2,301,966 |           |  |   | 2,270,640 |          
|Loans receivable                            |                   |                        | 6,740,284 |                     |  |          | 6,839,894 |                     |  |          | 6,617,120 |           |  |   | 6,132,127 |           |  |   | 6,226,597 |           |  |   | 6,014,990 |          
|MSRs                                        |                   |                        | 343,544   |                     |  |          | 258,998   |                     |  |          | 413,588   |           |  |   | 299,215   |           |  |   | 226,834   |           |  |   | 365,046   |          
|Other assets                                |                   |                        | 473,763   |                     |  |          | 482,489   |                     |  |          | 465,041   |           |  |   | 466,370   |           |  |   | 473,382   |           |  |   | 459,294   |          
|Derivatives                                 |                   |                        | 63,139    |                     |  |          | 85,096    |                     |  |          | 66,612    |           |  |   | 72,445    |           |  |   | 67,868    |           |  |   | 104,189   |          
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |          
|                                            | Total assets      |                        | $         | 9,358,366           |  |          | $         | 9,384,749           |  |          | $         | 9,306,416 |  |   | $         | 9,458,996 |  |   | $         | 9,493,236 |  |   | $         | 9,410,748 | 
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |          
|Deposits                                    |                   | $                      | 3,522,817 |                     |  | $        | 3,570,350 |                     |  | $        | 3,476,769 |           |  | $ | 3,177,911 |           |  | $ | 3,217,410 |           |  | $ | 3,139,628 |          
|Advances from Federal Home Loan Bank        |                   |                        | 3,381,022 |                     |  |          | 3,411,732 |                     |  |          | 3,351,386 |           |  |   | 2,786,237 |           |  |   | 2,820,402 |           |  |   | 2,753,314 |          
|Borrowings                                  |                   |                        | 1,401,714 |                     |  |          | 1,402,882 |                     |  |          | 1,400,548 |           |  |   | 2,493,168 |           |  |   | 2,495,465 |           |  |   | 2,490,801 |          
|Other liabilities                           |                   |                        | 145,028   |                     |  |          | 145,143   |                     |  |          | 144,915   |           |  |   | 140,853   |           |  |   | 140,897   |           |  |   | 140,741   |          
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |          
|                                            | Total liabilities |                        |           | 8,450,581           |  |          |           | 8,530,107           |  |          |           | 8,373,618 |  |   |           | 8,598,169 |  |   |           | 8,674,174 |  |   |           | 8,524,484 | 
|Shareholders equity (NPV)                  |                   | $                      | 907,785   |                     |  | $        | 854,642   |                     |  | $        | 932,798   |           |  | $ | 860,827   |           |  | $ | 819,062   |           |  | $ | 886,264   |          
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |          
|% Change from base case                     |                   |                        |           |                     |  |          | (5.85%    | )                   |  |          | 2.76%     |           |  |   |           |           |  |   | (4.85%    | )         |  |   | 2.95      | %        
|                                            |                   |                        |           |                     |  |          |           |                     |  |          |           |           |  |   |           |           |  |   |           |           |  |   |           |          

The increase in the fair value of equity from
March 31, 2003 to December 31, 2002 is primarily due
to an increase in earnings in the first quarter of 2003.
Additionally, the March 31, 2003 analysis indicates that
the Bank is more asset sensitive and better positioned for
rising rates. Significant changes include more sensitivity in
the derivatives asset due to the nature of these financial
instruments. It should be noted that this analysis does not
reflect changes in volumes and profits from our mortgage banking
operations that would be expected to result from the interest
rate environment.

The assumptions inherent in our interest rate
models include expected valuation changes in an instantaneous
and parallel rate shock and assumptions as to the degree of
correlation between our hedge positions and the hedged assets
and liabilities. These assumptions may not accurately predict
factors such as the spread-widening or spread-tightening risk
among the changes in rates on Treasury, LIBOR/swap curve and
mortgages. In addition, the sensitivity analysis described in
the prior paragraph is limited by the fact that it is performed
at a particular point in time and does not incorporate other
factors that would impact our financial performance in these
scenarios. These factors include, but are not limited to
expected increases in income associated with the expected
increase in production volume that could result from a decrease
in interest rates and changes in the asset, liability and
derivative mix during interest rate changes. Consequently, the
preceding simulation should not be viewed as a forecast, as it
is reasonable to expect that actual results will vary
significantly from the analyses discussed above.

The Companys Board of Directors level and
management level ALCOs monitor our hedging activities to
determine whether the value of our hedge positions, their
correlation to the balance sheet item being hedged, and the
amounts being hedged, continue to provide adequate protection
against interest rate risk. While there can be no assurances
that our interest rate management strategies will be effective,
we believe we have adequate internal controls to monitor and
manage our interest rate risk within reasonable levels.

28



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##### 



CREDIT RISK AND RESERVES

GENERAL

The following table summarizes the Companys
allowance for loan losses/credit discounts and non-performing
assets as of March 31, 2003.

|                                         |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |       |       | 
|---------------------------------------- | ------------------------------------ | ----------------------------------- | --------- | ------------- | --------- | --------------- | ------ | -------------- | ------ | ----------- | ---- | ---- | ---- | - | ------ | ------ | ------ | - | ----- | ----- | ----- | 
|                                         |                                      |                                     |           | Allowance     |           |                 |        |                |        |            
|                                         |                                      |                                     |           | for Loan      |           | Total Reserves  |        |                |        | Net Charge 
|                                         |                                      |                                     |           | Losses/Credit |           | as a Percentage |        | Non-Performing |        | Offs Net   
|Type of Loan                             |                                      | Book Value                          |           | Discounts     |           | of Book Value   |        | Assets         |        | REO (Gains)
|                                         |                                      |                                     |           |               |           |                 |        |                |        |            
|                                         |                                      |                                    
|                                         |                                      | (Dollars in thousands)             
|Held for investment portfolio            |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |      
|SFR mortgage loans and HELOCs            |                                      | $                                   | 2,517,901 |               |           | $               | 12,791 |                |        |             | 0.51 | %    |      | $ | 10,860 |        |        | $ | 1,166 |      
|Land and other mortgage                  |                                      |                                     | 103,744   |               |           |                 | 2,864  |                |        |             | 2.76 | %    |      |   | 2,732  |        |        |   |      |      
|Builder construction and income property |                                      |                                     | 571,429   |               |           |                 | 15,363 |                |        |             | 2.69 | %    |      |   | 8,541  |        |        |   |      |      
|Consumer construction                    |                                      |                                     | 900,428   |               |           |                 | 10,506 |                |        |             | 1.17 | %    |      |   | 12,670 |        |        |   | 149   |      
|                                         |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |      
|                                         | Total core held for investment loans |                                     |           | 4,093,502     |           |                 |        | 41,524         |        |             |      | 1.01 | %    |   |        | 34,803 |        |   |       | 1,315 |      
|                                         | Discontinued product lines(1)        |                                     |           | 91,201        |           |                 |        | 8,722          |        |             |      | 9.56 | %    |   |        | 9,529  |        |   |       | 2,300 |      
|                                         |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |      
|                                         |                                      | Total held for investment portfolio |           |               | 4,184,703 |                 |        |                | 50,246 |             |      |      | 1.20 | % |        |        | 44,332 |   |       |       | 3,615 | 
|Held for sale portfolio                  |                                      |                                     | 2,618,423 |               |           |                 | 7,559  |                |        |             | 0.29 | %    |      |   | 25,734 |        |        |   |      |      
|                                         |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |      
|                                         |                                      | Total loans                         |           | $             | 6,803,126 |                 |        | $              | 57,805 |             |      |      | 0.85 | % |        |        | 70,066 |   |       | $     | 3,615 | 
|                                         |                                      |                                     |           |               |           |                 |        |                |        |             |      |      |      |   |        |        |        |   |       |      

|                                                                |                            |                         |        |        |        |  |   |      |      |  
|--------------------------------------------------------------- | -------------------------- | ----------------------- | ------ | ------ | ------ |  | - | ---- | ---- | -
|Foreclosed assets                                               |                            |                         |        |        |        |  |   |     
|                                                                | Core portfolios            |                         |        | 25,655 |        |  | $ | (303 | )   
|                                                                | Discontinued product lines |                         |        | 2,216  |        |  |   | (269 | )   
|                                                                |                            |                         |        |        |        |  |   |     
|                                                                |                            | Total foreclosed assets |        |        | 27,871 |  |   | $    | (572 | )
|                                                                |                            |                         |        |        |        |  |   |     
|Total non-performing assets                                     |                            | $                       | 97,937 |        |        |  |   |     
|                                                                |                            |                         |        |        |        |  |   |     
|Total non-performing assets as a percentage of
    total assets |                            |                         | 1.03%  |        |        |  |   |     
|                                                                |                            |                         |        |        |        |  |   |     



---



|    |                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------
|(1) | Discontinued product lines include manufactured
    home loans, home improvement loans and warehouse lines of credit.

29



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##### 



The following tables provide additional
comparative data on non-performing assets relative to the
allowance for loan losses.

|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |        |        |         | 
|------------------------------------------------------------------------- | -------------------------- | ----------------------------- | ------------------------------------ | --------- | ------ | ------------ | ------ | ------ | ------ | ------- | ------ | ------ | ------ | ------- | 
|                                                                          |                            | March 31,                     |                                      | March 31, |        | December 31,
|                                                                          |                            | 2003                          |                                      | 2002      |        | 2002        
|                                                                          |                            |                               |                                      |           |        |             
|                                                                          |                            |                              
|                                                                          |                            | (Dollars in thousands)       
|Loans held for investment                                                 |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|                                                                          | Portfolio loans            |                               |                                      |           |        |              |        |        |        |         |        |        |       
|                                                                          |                            | SFR mortgage loans            |                                      | $         | 10,862 |              |        | $      | 24,820 |         |        | $      | 15,097 |        
|                                                                          |                            | Land and other mortgage loans |                                      |           | 2,730  |              |        |        | 9,794  |         |        |        | 8,376  |        
|                                                                          |                            | Builder construction          |                                      |           | 8,541  |              |        |        | 17,703 |         |        |        | 9,275  |        
|                                                                          |                            | Consumer construction         |                                      |           | 12,670 |              |        |        | 12,557 |         |        |        | 10,257 |        
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|                                                                          |                            |                               | Total portfolio non-performing loans |           |        | 34,803       |        |        |        | 64,874  |        |        |        | 43,005  | 
|                                                                          | Discontinued product lines |                               |                                      | 9,529     |        |              |        | 14,531 |        |         |        | 10,005 |       
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|Total non-performing loans held for investment                            |                            |                               | 44,332                               |           |        |              | 79,405 |        |        |         | 53,010 |       
|Non-performing loans held for sale                                        |                            |                               | 25,734                               |           |        |              | 25,081 |        |        |         | 10,626 |       
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|                                                                          |                            |                               | Total non-performing loans           |           |        | 70,066       |        |        |        | 104,486 |        |        |        | 63,636  | 
|Foreclosed assets                                                         |                            |                               | 27,871                               |           |        |              | 16,133 |        |        |         | 36,526 |       
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|                                                                          |                            |                               | Total non-performing assets          |           | $      | 97,937       |        |        | $      | 120,619 |        |        | $      | 100,162 | 
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|Total non-performing assets to total assets                               |                            |                               | 1.03                                 | %         |        |              | 1.68   | %      |        |         | 1.05   | %     
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       
|Allowance for loan losses to non-performing loans
    held for investment |                            |                               | 113                                  | %         |        |              | 72     | %      |        |         | 96     | %     
|                                                                          |                            |                               |                                      |           |        |              |        |        |        |         |        |       

30



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##### 



The following shows the activity in the allowance
for loan losses during the indicated periods:

|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |        |        |        | 
|--------------------------------------- | ----------------------------- | ----------------------------- | ------------------------------- | --------- | ------ | ------------ | ------ | ------ | ---- | ------ | ------ | ------ | ------ | ------ | 
|                                        |                               |                              
|                                        |                               | Three Months Ended           
|                                        |                               |                              
|                                        |                               | March 31,                     |                                 | March 31, |        | December 31,
|                                        |                               | 2003                          |                                 | 2002      |        | 2002        
|                                        |                               |                               |                                 |           |        |             
|                                        |                               |                              
|                                        |                               | (Dollars in thousands)       
|Core portfolio loans                    |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Balance, beginning of period            |                               | $                             | 41,314                          |           |        | $            | 41,771 |        |      | $      | 42,289 |       
|Provision for loan losses               |                               |                               | 1,525                           |           |        |              | 2,176  |        |      |        | 4,251  |       
|Charge-offs net of recoveries           |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|                                        |                               | SFR mortgage loans            |                                 |           | (1,166 | )            |        |        | (772 | )      |        |        | (1,867 | )     
|                                        |                               | Land and other mortgage loans |                                 |           |       |              |        |        |     |        |        |        | (1,658 | )     
|                                        |                               | Consumer construction         |                                 |           | (149   | )            |        |        |     |        |        |        | (90    | )     
|                                        |                               | Builder construction          |                                 |           |       |              |        |        | (973 | )      |        |        | (1,611 | )     
|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|                                        | Charge-offs net of recoveries |                               |                                 | (1,315    | )      |              |        | (1,745 | )    |        |        | (5,226 | )     
|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Balance, end of period                  |                               |                               | 41,524                          |           |        |              | 42,202 |        |      |        | 41,314 |       
|Discontinued product lines              |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Balance, beginning of period            |                               |                               | 9,447                           |           |        |              | 15,929 |        |      |        | 11,582 |       
|Provision for loan losses               |                               |                               | 1,575                           |           |        |              | 2,010  |        |      |        | 1,450  |       
|                                        | Charge-offs net of recoveries |                               |                                 | (2,300    | )      |              |        | (3,239 | )    |        |        | (3,585 | )     
|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Balance, end of period                  |                               |                               | 8,722                           |           |        |              | 14,700 |        |      |        | 9,447  |       
|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|                                        |                               |                               | Total allowance for loan losses |           | $      | 50,246       |        |        | $    | 56,902 |        |        | $      | 50,761 | 
|                                        |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Net charge-offs to average loans        |                               |                               | 0.07                            | %         |        |              | 0.13   | %      |      |        | 0.20   | %     
|Net charge-offs to quarterly production |                               |                               | 0.05                            | %         |        |              | 0.12   | %      |      |        | 0.13   | %     
|Core portfolio loans only:              |                               |                               |                                 |           |        |              |        |        |      |        |        |       
|Net charge-offs to average loans        |                               |                               | 0.02                            | %         |        |              | 0.05   | %      |      |        | 0.12   | %     
|Net charge-offs to quarterly production |                               |                               | 0.02                            | %         |        |              | 0.04   | %      |      |        | 0.08   | %     

Total credit related reserves, including the
allowance for loan losses and lower of cost or market
valuations, were $57.8 million at March 31, 2003.
Portfolio non-performing loans declined 19% from
December 31, 2002, and the allowance for loan losses as a
percentage of non-performing loans held for investment increased
from 96% at December 31, 2002 to 113% at March 31,
2003. Overall, non-performing assets (NPAs) totaled
$97.9 million, or 1.03% of total assets at March 31,
2003 compared to $100.2 million, or 1.05% of total assets
at December 31, 2002. However, non-performing loans held
for investment decreased while the non-performing loans held for
sale increased. The decrease in non-performing loans held for
investment is mainly due to the sale or liquidation of
non-performing loans. The Company also sold $22.3 million
of foreclosed assets during the quarter ended March 31,
2003. The increase in non-performing assets for loans held for
sale portfolio is a result of exercising clean-up calls.

The allowance for loan losses of
$50.2 million for loans held for investment at
March 31, 2003 represented 1.20% of total loans held for
investment. This compares to an allowance for loan losses of
$50.8 million, or 1.28% of total loans held for investment,
at December 31, 2002. Net charge-offs decreased from 0.13%
of average loans during the fourth quarter of 2002 to 0.07%
during the first quarter of 2003.

With respect to the portfolio of loans held for
investment in IndyMacs core businesses, the allowance for
loan losses at March 31, 2003 was $41.5 million or
1.0% of loan balance, comparable to 1.1% of total loan balance
at December 31, 2002. Net charge-offs on these core
portfolios during the first quarter of 2003 were
$1.3 million, down from $5.2 million during the fourth
quarter of 2002. The overall asset quality improved due to
decreases in non-performing loans held-for-investment and
disposition of foreclosed assets.

31



---



##### 



With respect to our core portfolio loans held for
investment, the decrease in non-performing loans was due to the
liquidation of such loans through the Banks default
management group, and in part, to the sale of non-performing
loans acquired through clean-up calls during the first quarter
of 2003. As master servicer for our various securitizations, we
retain the right to call the securities when the outstanding
loan balance in the securitization trust declines to a specified
level, typically 10%, of the original balance. When the fair
value of loans remaining within a securitization exceeds the
expected losses on nonperforming loans and the cost of exercise,
we will typically exercise our option to call. We called a total
of $420.3 million loans during the first quarter of 2003. A
portion of the loans we acquired pursuant to clean-up calls was
delinquent or non-performing and was sold before the end of the
quarter. At March 31, 2003, non-performing assets acquired
through clean-up calls amounted to $16.8 million. The
non-performing loans from clean-up calls are primarily
classified as loans held for sale at March 31, 2003. We
anticipate that approximately $600 million in loans will be
eligible for clean-up calls during the remainder of 2003.
Therefore, it is possible that the absolute levels of
non-performing loans held by us may increase temporarily between
the time of the call exercise and the disposition of these loans.

With respect to IndyMacs non-core
liquidating portfolios, consisting primarily of manufactured
housing and home improvement loans, net charge-offs totaled
$2.3 million during the first quarter of 2003, down from
the $3.6 million of charge-offs on these portfolios during
the fourth quarter of 2002. After provision for losses of
$1.6 million, the allowance for loan losses was
$8.7 million, or 9.6% of the remaining principal balance of
such liquidating portfolios, comparable to the 9.7% reserve
coverage at December 31, 2002.

Our determination of the level of the allowance
for loan losses and, correspondingly, the provision for loan
losses, is based on managements judgments and assumptions
regarding various matters, including general economic
conditions, loan portfolio composition, delinquency trends and
prior loan loss experience. In assessing the adequacy of the
allowance for loan losses, management reviews the performance in
the portfolios of loans held for investment and the non-core
portfolio of discontinued product lines which consists primarily
of manufactured housing loans and home improvement loans.

While we consider the allowance for loan losses
to be adequate based on information currently available, future
adjustments to the allowance may be necessary due to changes in
economic conditions, delinquency levels, foreclosure rates, or
loss rates. The level of our allowance for loan losses is also
subject to review by our federal regulators, the Office of
Thrift Supervision (OTS) and the Federal Deposit
Insurance Corporation (FDIC). These agencies may
require that our allowance for loan losses be increased based on
their evaluation of the information available to them at the
time of their examination of the Bank. The most recent OTS and
FDIC examinations of IndyMac Bank were completed during the
third quarter of 2002. No adjustment to the allowance for loan
losses was recommended by the OTS or FDIC.

With respect to mortgage loans held for sale,
IndyMac does not provide an allowance for loan losses, pursuant
to the applicable accounting rules. Instead, a component for
credit risk related to loans held for sale is embedded in the
lower of cost or market valuation for these loans. The discount
credit reserve on loans held for sale totaled $7.6 million
at March 31, 2003. The increase in non-performing loans
held for sale was largely due to the delinquent loans acquired
as part of the clean-up calls exercised by the Company during
the first quarter 2003. Therefore, the increase in
non-performing loans is not related to our core lending
portfolios and is expected to be temporary until the disposition
of these loans.

SECONDARY MARKET RESERVE

We do not sell loans with recourse in our loan
sale activities. However, we can be required to repurchase loans
from investors when our loan sales contain individual loans that
are not in conformity with the representations and warranties we
make at the time of sale. We have made significant investments
in our pre-production and post-production quality control
processes to identify potential systemic issues that could cause
repurchases. We believe that these efforts have improved our
production quality; however, increases in default rates due to
an economic slowdown could cause the overall rate of repurchases
to remain constant or even increase. Since inception in 1993,
the Company has repurchased only a very small amount of loans
from its securitization trusts. The increase in repurchase
activity in recent years has been primarily a function of

32



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##### 



IndyMacs diversification of its loan sale
channels to whole loan and GSE sales. While sales through these
channels generate enhanced cash flows, they tend to have a
greater level of representation and warranty risk. The following
table shows the amount of loans we have repurchased from each
distribution channel, since the Company began active lending
operations in January 1993.


|            |                       |                       |   |            |      |             |   |        |        |  |  |      |      |  
|----------- | --------------------- | --------------------- | - | ---------- | ---- | ----------- | - | ------ | ------ |  |  | ---- | ---- | -
|            |                       | Amount                |   |            |      | Percentage 
|            |                       | Repurchased           |   | Total Sold |      | Repurchased
|            |                       |                       |   |            |      |            
|            |                       |                      
|            |                       | (Dollars in millions)
|Loans sold: |                       |                       |   |            |      |             |   |        |        |  |  |     
|            | GSEs and whole loans  |                       | $ | 65.8       |      |             | $ | 40,565 |        |  |  | 0.16 | %   
|            | Securitization trusts |                       |   | 7.4        |      |             |   | 39,805 |        |  |  | 0.02 | %   
|            |                       |                       |   |            |      |             |   |        |        |  |  |     
|            |                       | Total                 |   | $          | 73.2 |             |   | $      | 80,370 |  |  |      | 0.09 | %
|            |                       |                       |   |            |      |             |   |        |        |  |  |     

The Company maintains a secondary market reserve
for losses that arise in connection with loans that we are
required to repurchase from whole loan sales or securitization
transactions. This reserve, which totaled $27.1 million at
March 31, 2003, has two components: a reserve for
repurchases arising from representation and warranty claims, and
a reserve for disputes with investors and vendors with respect
to contractual obligations pertaining to mortgage operations.
The table below shows the activity in the secondary market
reserve during the three months ended March 31, 2003.

|                                                                                     |  |             |        |  
|------------------------------------------------------------------------------------ |  | ----------- | ------ | -
|                                                                                     |  | (Dollars in
|                                                                                     |  | thousands) 
|                                                                                     |  |            
|Balance, January 1, 2003                                                             |  | $           | 28,170 |  
|Additions/ provisions                                                                |  |             | 3,724  |  
|Claims reimbursement and estimated discounts on
    loans held for sale/ charge-offs |  |             | (4,786 | )
|                                                                                     |  |             |        |  
|Balance, March 31, 2003                                                              |  | $           | 27,108 |  
|                                                                                     |  |             |        |  

The reserve level is a function of expected
losses based on actual pending claims and repurchase requests,
historical experience, loan volume and loan sales distribution
channels and the assessment of probable vendor or investor
claims. While the ultimate amount of repurchases and claims is
uncertain, management believes that the reserve is adequate. The
Company will continue to evaluate the adequacy of this reserve
and may continue to allocate a portion of its gain on sale
proceeds to the reserve going forward. The entire balance of the
secondary market reserve is included on the consolidated balance
sheets as a component of other liabilities.

OPERATING EXPENSES

A summary of operating expenses follows:

|                                         |  |                        |        |           |  |              |        |   |  |   |        | 
|---------------------------------------- |  | ---------------------- | ------ | --------- |  | ------------ | ------ | - |  | - | ------ | 
|                                         |  |                       
|                                         |  | Three Months Ended    
|                                         |  |                       
|                                         |  | March 31,              |        | March 31, |  | December 31,
|                                         |  | 2003                   |        | 2002      |  | 2002        
|                                         |  |                        |        |           |  |             
|                                         |  |                       
|                                         |  | (Dollars in thousands)
|Salaries and related                     |  | $                      | 53,094 |           |  | $            | 49,535 |   |  | $ | 53,344 | 
|Premises and equipment                   |  |                        | 8,306  |           |  |              | 6,853  |   |  |   | 8,215  | 
|Loan purchase costs                      |  |                        | 7,058  |           |  |              | 4,626  |   |  |   | 7,055  | 
|Professional services                    |  |                        | 4,610  |           |  |              | 4,794  |   |  |   | 6,784  | 
|Data processing                          |  |                        | 6,764  |           |  |              | 4,562  |   |  |   | 5,581  | 
|Office                                   |  |                        | 5,260  |           |  |              | 3,933  |   |  |   | 5,125  | 
|Advertising and promotion                |  |                        | 6,064  |           |  |              | 2,610  |   |  |   | 4,485  | 
|Operations and sale of foreclosed assets |  |                        | 956    |           |  |              | (9     | ) |  |   | 1,052  | 
|Other                                    |  |                        | 3,546  |           |  |              | 2,650  |   |  |   | 3,166  | 
|                                         |  |                        |        |           |  |              |        |   |  |   |        | 
|                                         |  | $                      | 95,658 |           |  | $            | 79,554 |   |  | $ | 94,807 | 
|                                         |  |                        |        |           |  |              |        |   |  |   |        | 

33



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General and administrative expenses, including
salaries, increased during the three months ended March 31,
2003 to $95.7 million, compared to $79.6 million
during the same period in 2002, as the Company has continued to
build new product lines and channels and infrastructure and to
open new locations to support its projected continued growth in
its operations. This is evident in the 34.9% increase in the
Companys average full-time equivalent employees from 2,435
for the three months ended March 31, 2002 to 3,286 for the
three months ended March 31, 2003. The Company has also
made investments to (1) enhance its quality controls and
compliance structure to ensure continued improvement in asset
quality and support the growth of higher margin products;
(2) strengthen its technology platform; (3) expand its
sales force infrastructure with dedicated resources focused on
new customer activation, customer training and support, and
improve its conversion of loan submissions to fundings; and
(4) enhance its customer service response performance.

DIVIDEND POLICY

IndyMac intends to pay an annual dividend of
$0.40 per share in 2003 in quarterly increments of $0.10 per
share, subject to the Boards continuing review of
IndyMacs results of operations and capital requirements,
market conditions and other relevant factors in future periods.

Accordingly, on April 29, 2003, IndyMac
Bancorps Board of Directors declared a cash dividend of
$0.10 per share, payable June 19, 2003 to shareholders of
record on May 15, 2003. The dividend represents a payout
ratio of approximately 14.9%.

FUTURE OUTLOOK

On average, U.S. mortgage debt outstanding
has grown approximately 7% to 8% per year over the last twenty
years and is projected, based on economic demographics, to
continue this level of growth over the next decade. At this
rate, mortgage debt outstanding roughly doubles every decade.
Since the inception of its operating business plan 10 years
ago in January 1993 IndyMac has grown earnings at a compounded
annual growth rate of 40% and EPS at a compounded annual growth
rate of 28%. We believe, as a result of our business model,
employees, current market share, capital strength and historic
performance, that we can achieve growth at approximately two
times the industry rate, or approximately 15% over the
intermediate term. Our results are nonetheless subject to a
variety of factors that are not within our control, including
those referred to under Forward-Looking Statements,
elsewhere in this report and in our annual, quarterly and other
reports filed with the Securities and Exchange Commission.

For 2003, the Company expects that earnings per
share will grow 10% to 15% compared to 2002. However, the
mortgage banking industry is cyclical in nature and can
fluctuate materially on a near term basis. The Companys
EPS range for 2003 incorporates the current forecast by the
Mortgage Bankers Association of America for a 4% increase in
mortgage industry production in 2003. The environment of
historically low interest rates over the past two years has been
very favorable for mortgage bankers such as IndyMac. It is
possible that as the industry transitions to a higher interest
rate environment, the Company could see lower levels of growth,
or even a reduction in earnings per share, given the volatility
of the industry. The Company expects, however, that its annual
growth rate will normalize at around 15% over the intermediate
term.

LIQUIDITY AND CAPITAL RESOURCES

OVERVIEW

At March 31, 2003, we had operating
liquidity of $926.8 million, which is represented by
unpledged liquid assets on hand plus amounts that may be
immediately raised through the pledging of other available
assets as collateral pursuant to committed financing facilities.
We currently believe that our liquidity level is in excess of
that necessary to satisfy our operating requirements and meet
our obligations and commitments in a timely and cost effective
manner.

34



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##### 



PRINCIPAL SOURCES OF CASH

Our principal financing needs are to fund
acquisitions of mortgage loans and our investment in mortgage
loans, mortgage-backed securities and MSRs. Our primary sources
of funds used to meet these financing needs are loan sales and
securitizations, deposits, advances from the Federal Home Loan
Bank, borrowings and retained earnings. The sources used vary
depending on such factors as rates paid, maturities and the
impact on our capital.

Loan Sales and
Securitizations

Our business model relies heavily upon selling
the majority of our mortgage loans shortly after acquisition.
The proceeds of these sales are a critical component of the
liquidity necessary for our ongoing operations. During the three
months ended March 31, 2003, we sold our loans through
three channels: (1) GSEs; (2) private label
securitizations; and (3) whole loan sales. If any of our
sales channels were disrupted, our liquidity could be negatively
impacted. Disruptions in our whole loan sales and mortgage
securitization transactions can occur as a result of the
performance of our existing securitizations, as well as economic
events or other factors beyond our control.

Deposits/ Retail Bank

We solicit deposits from the general public and
institutions by offering a variety of accounts and rates through
our network of 10 branches in Southern California,
telebanking, and Internet channels. Through our Web site at
www.indymacbank.com, consumers can access their accounts
24-hours a day, seven days a week. Online banking allows
customers to access their accounts, view balances, transfer
funds between accounts, view transactions, download account
information and pay their bills conveniently from any computer
terminal.

Our deposit products include regular savings
accounts, demand deposit accounts, money market accounts,
certificates of deposit and individual retirement accounts.

The following table sets forth the balance of
deposits, by deposit category, as of the following period ends.

|                             |                     |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |     |  
|---------------------------- | ------------------- | ---------------------- | --------- | -------------- |  | ----------------- | -- | -------- | - | ------ | --------- | --------- |  |  | -- | --- | - | - | --------- | --------- |  |  | -- | --- | -
|                             |                     |                        |           |                |  |                  
|                             |                     | March 31, 2003         |           | March 31, 2002 |  | December 31, 2002
|                             |                     |                        |           |                |  |                  
|                             |                     |                        |           | % of           |  |                   |    | % of     |   |        |           | % of     
|                             |                     |                        |           | Total          |  |                   |    | Total    |   |        |           | Total    
|                             |                     | Amount                 |           | Deposits       |  | Amount            |    | Deposits |   | Amount |           | Deposits 
|                             |                     |                        |           |                |  |                   |    |          |   |        |           |          
|                             |                     |                       
|                             |                     | (Dollars in thousands)
|Noninterest-bearing checking |                     | $                      | 40,221    |                |  |                   | 1  | %        |   | $      | 34,956    |           |  |  | 1  | %   |   | $ | 38,430    |           |  |  | 1  | %  
|Interest-bearing checking    |                     |                        | 42,068    |                |  |                   | 1  | %        |   |        | 35,204    |           |  |  | 1  | %   |   |   | 37,867    |           |  |  | 1  | %  
|Savings                      |                     |                        | 932,141   |                |  |                   | 27 | %        |   |        | 495,649   |           |  |  | 16 | %   |   |   | 635,608   |           |  |  | 20 | %  
|Custodial accounts           |                     |                        | 557,041   |                |  |                   | 16 | %        |   |        | 227,844   |           |  |  | 7  | %   |   |   | 497,462   |           |  |  | 16 | %  
|                             |                     |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |    
|                             | Total core deposits |                        |           | 1,571,471      |  |                   |    | 45       | % |        |           | 793,653   |  |  |    | 25  | % |   |           | 1,209,367 |  |  |    | 38  | %
|Certificates of deposit      |                     |                        | 1,904,710 |                |  |                   | 55 | %        |   |        | 2,320,296 |           |  |  | 75 | %   |   |   | 1,931,135 |           |  |  | 62 | %  
|                             |                     |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |    
|                             | Total deposits      |                        | $         | 3,476,181      |  |                   |    | 100      | % |        | $         | 3,113,949 |  |  |    | 100 | % |   | $         | 3,140,502 |  |  |    | 100 | %
|                             |                     |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |    

35



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The following table sets forth the balance of
deposits, by deposit channel, as of the following period ends:

|            |                |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |     |  
|----------- | -------------- | ---------------------- | --------- | -------------- |  | ----------------- | -- | -------- | - | ------ | --------- | --------- |  |  | -- | --- | - | - | --------- | --------- |  |  | -- | --- | -
|            |                |                        |           |                |  |                  
|            |                | March 31, 2003         |           | March 31, 2002 |  | December 31, 2002
|            |                |                        |           |                |  |                  
|            |                |                        |           | % of           |  |                   |    | % of     |   |        |           | % of     
|            |                |                        |           | Total          |  |                   |    | Total    |   |        |           | Total    
|            |                | Amount                 |           | Deposits       |  | Amount            |    | Deposits |   | Amount |           | Deposits 
|            |                |                        |           |                |  |                   |    |          |   |        |           |          
|            |                |                       
|            |                | (Dollars in thousands)
|Branch      |                | $                      | 1,402,724 |                |  |                   | 40 | %        |   | $      | 1,296,837 |           |  |  | 42 | %   |   | $ | 1,297,668 |           |  |  | 41 | %  
|Telebanking |                |                        | 478,338   |                |  |                   | 14 | %        |   |        | 660,797   |           |  |  | 21 | %   |   |   | 489,977   |           |  |  | 16 | %  
|Internet    |                |                        | 398,242   |                |  |                   | 12 | %        |   |        | 407,180   |           |  |  | 13 | %   |   |   | 338,830   |           |  |  | 11 | %  
|Money desk  |                |                        | 639,836   |                |  |                   | 18 | %        |   |        | 521,291   |           |  |  | 17 | %   |   |   | 516,565   |           |  |  | 16 | %  
|Custodial   |                |                        | 557,041   |                |  |                   | 16 | %        |   |        | 227,844   |           |  |  | 7  | %   |   |   | 497,462   |           |  |  | 16 | %  
|            |                |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |    
|            | Total deposits |                        | $         | 3,476,181      |  |                   |    | 100      | % |        | $         | 3,113,949 |  |  |    | 100 | % |   | $         | 3,140,502 |  |  |    | 100 | %
|            |                |                        |           |                |  |                   |    |          |   |        |           |           |  |  |    |     |   |   |           |           |  |  |    |    

Included in deposits at March 31, 2003 and
December 31, 2002 were non-interest bearing custodial
accounts, primarily related to our GSE servicing portfolio,
totaling $557.0 million and $497.5 million,
respectively.

Advances from Federal Home Loan Bank

The Federal Home Loan Bank system functions as a
borrowing source for regulated financial depositories and
similar institutions that are engaged in residential housing
finance. As a member of the FHLB of San Francisco, we are
required to own capital stock of the FHLB and are authorized to
apply for advances from the FHLB, on a secured basis, in amounts
determined by reference to available collateral. SFR mortgage
loans, Agency and AAA-rated mortgage-backed securities are the
principal collateral that may be used to secure these
borrowings, although certain other types of loans and other
assets may also be accepted pursuant to FHLB policies and
statutory requirements. Currently, the Bank is approved for
collateralized advances of up to $3.8 billion, of which
$3.3 billion were outstanding at March 31, 2003. The
FHLB offers several credit programs, each with its own fixed or
floating interest rate, and a range of maturities.

Trust Preferred Securities and
Warrants

On November 14, 2001, we completed an
offering of Warrants and Income Redeemable Equity Securities to
investors. Gross proceeds of the transaction were
$175 million. The securities were offered as units
consisting of a trust preferred security, issued by a trust
formed by us, and a warrant to purchase IndyMac Bancorps
common stock. The proceeds from the offering are used in ongoing
operations and will fund future growth and/or repurchases of
IndyMac Bancorp stock under its share repurchase program.

Other Borrowings

Other borrowings consist of loans and securities
sold under committed financing facilities and uncommitted
agreements to repurchase. Total other borrowings decreased to
$1.4 billion at March 31, 2003, from $2.5 billion
at December 31, 2002. The decrease of $1.1 billion was
the result of using funds generated from sales of loans and
securities, an increase in FHLB advances and an increase in
savings deposits, instead of borrowings to fund mortgage loans
originated during the three months ended March 31, 2003.

At March 31, 2003, we had $2.9 billion
in committed financing facilities, of which $953.8 million
was utilized and $730.2 million was available to use, based
on eligible collateral. Decisions by our lenders and investors
to make additional funds available to us in the future will
depend upon a number of factors. These include our compliance
with the terms of existing credit arrangements, our financial
performance, eligible collateral, changes in our credit rating,
industry and market trends in our various businesses, the
general availability and interest rates applicable to financing
and investments, the lenders and/or investors own
resources and policies concerning loans and investments and the
relative attractiveness of alternative

36



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##### 



investment or lending opportunities. Due to the
availability of deposits and FHLB advances, we are reducing our
committed financing facilities in order to reduce the amount of
commitment fees we pay.


PRINCIPAL USES OF CASH

In addition to the financing sources discussed
above, cash uses are funded by net cash flows from operations,
sales of mortgage-backed securities and principal and interest
payments on loans and securities.

As a financial institution, the lending and
borrowing functions are integral parts of our business. When
evaluating our sources and uses of cash, we consider cash used
to grow our investments, and the borrowings used to finance
those investments, separately from the Companys operating
cash flows. Our most significant use of cash is for the
acquisition of mortgage loans and securities. In accordance with
accounting principles generally accepted in the United States of
America (US GAAP), purchases of loans held for
sale and trading securities, net of sales of such loans and
securities, are required to be included in our consolidated
statements of cash flows (see page 46) as a component of
net cash used in operating activities, whereas the borrowings
used to fund a substantial portion of such loan and securities
purchases are required to be recorded in our cash flow
statements as a component of net cash provided by financing
activities. The amounts of net purchases of loans held for sale
and trading securities included as components of net cash (used
in)/ provided by operating activities totaled
$(131.0) million during the first quarter of 2003 and
$477.4 billion during the first quarter of 2002. Excluding
the purchase and sale activity for loans held for sale and
trading securities, the net cash (used in)/ provided by the
Companys operating activities totaled $53.3 million
and $(17.9) million for the quarters ended March 31,
2003 and 2002, respectively.

ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss was
$(19.8) million at March 31, 2003, compared to ($17.7)
million at December 31, 2002. This change was a result of:
(1) the decline in value of securities classified as
available for sale, and; (2) the decline in fair value of
certain interest rate swaps designated as cash flow hedges of
floating rate borrowings and does not include related increases
in the fair value of loans held for investment that are funded
by borrowings that are hedged by these interest rate swaps.
Accumulated Other Comprehensive Loss is not a component of the
determination of regulatory capital.

REGULATORY CAPITAL REQUIREMENTS

The Bank is subject to regulatory capital
regulations administered by the federal banking agencies. In
addition, as a condition to its approval of our acquisition of
SGV Bancorp, Inc. in July 2000, the OTS required that the Bank
hold Tier 1 (core) capital of at least 8% of adjusted
assets for three years following the consummation of the
transaction and maintain a risk-based capital position of at
least 10% of risk-weighted assets. Additionally, Tier 1
risk-based capital (core capital minus the deduction for
low-level recourse and residual interests) must be equal to at
least 6% of risk-weighted assets. The Bank currently meets all
of the requirements of a well-capitalized
institution under the general regulatory capital regulations and
also meets the additional requirements of the OTS approval
condition.

During 2001, the OTS issued guidance for subprime
lending programs, which requires a lender to quantify the
additional risks in its subprime lending activities and
determine the appropriate amounts of allowances for loan losses
and capital it needs to offset those risks. The OTS guidance
suggests that subprime portfolios be supported by capital equal
to one and one-half to three times greater than what is
appropriate for similar prime assets. The OTS has accepted the
Banks approach to conform to this guidance, which is based
on the secondary market and rating agency securitization models.
We segment the subprime loans into categories based on
quantifiable, increasing risk levels. Category I includes
all subprime loans with 1.0% to 1.5% estimated lifetime loss;
Category II includes all subprime loans with 1.5% to 2.0%
estimated lifetime loss; and Category III includes all subprime
loans with greater than 2.0% estimated lifetime loss. These
categories are risk-weighted for capital purposes at 150%, 200%
and 300% of the standard risk weighting for

37



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##### 



the asset type, respectively. We report our
subprime loan calculation in an addendum to the Thrift Financial
Report that we file with the OTS. The levels and balances within
each level were as follows at March 31, 2003:


|             |                |                        |         |               |  |            |     |  |  |  |    |    |  
|------------ | -------------- | ---------------------- | ------- | ------------- |  | ---------- | --- |  |  |  | -- | -- | -
|             |                |                        |         | Multiple of   |  |           
|             |                | 03/31/03               |         | Standard Risk |  | Risk-Based
|             |                | Balance                |         | Weighting     |  | Capital % 
|             |                |                        |         |               |  |           
|             |                |                       
|             |                | (Dollars in thousands)
|Category I   |                | $                      | 298,125 |               |  |            | 1.5 |  |  |  | 10 | % 
|Category II  |                |                        | 76,894  |               |  |            | 2.0 |  |  |  | 12 | % 
|Category III |                |                        | 196,187 |               |  |            | 3.0 |  |  |  | 22 | % 
|             |                |                        |         |               |  |            |     |  |  |  |    |   
|             | Total subprime |                        | $       | 571,206       |  |            |     |  |  |  |    | 15 | %
|             |                |                        |         |               |  |            |     |  |  |  |    |   

As of March 31, 2003, $347.9 million or
60.9% of our subprime loans are held for sale as calculated for
regulatory reporting purposes.

The following table presents the Banks
actual and required capital ratios and the minimum required
capital ratios to be categorized as well-capitalized
at March 31, 2003. Because not all institutions have
uniformly implemented the new subprime guidance, it is possible
that IndyMacs risk-based capital ratios will not be
comparable to other institutions. The impact of the additional
risk weighting criteria had the effect of reducing
IndyMacs risk-based capital by 107 basis points as noted
in the table below.

|                |                   |                |  |                     |   |                  |  |                  |   |  |  |       |   |  |  |       |  
|--------------- | ----------------- | -------------- |  | ------------------- | - | ---------------- |  | ---------------- | - |  |  | ----- | - |  |  | ----- | -
|                |                   |                |  |                     |   |                  |  | IndyMac         
|                |                   |                |  |                     |   |                  |  | Required Capital
|                |                   | As Reported    |  | Adjusted for        |   |                  |  | First 3 Years   
|                |                   | Pre-Subprime   |  | Additional Subprime |   | Well-Capitalized |  | (through        
|                |                   | Risk-Weighting |  | Risk-Weighting      |   | Minimum          |  | June 30, 2003)  
|                |                   |                |  |                     |   |                  |  |                 
|Capital Ratios: |                   |                |  |                     |   |                  |  |                  |   |  |  |       |   |  |  |      
|                | Tangible          |                |  | 9.14                | % |                  |  | 9.14             | % |  |  | 2.00  | % |  |  | 2.00  | %
|                | Tier 1 core       |                |  | 9.14                | % |                  |  | 9.14             | % |  |  | 5.00  | % |  |  | 8.00  | %
|                | Tier 1 risk-based |                |  | 14.12               | % |                  |  | 13.10            | % |  |  | 6.00  | % |  |  | 6.00  | %
|                | Total risk-based  |                |  | 14.83               | % |                  |  | 13.76            | % |  |  | 10.00 | % |  |  | 10.00 | %

The ratios above do not include
$38.5 million of unencumbered cash at IndyMac Bancorp that
is available for contribution to the Banks regulatory
capital. Including the excess capital held by the Bank and such
cash, we had $145.3 million of total excess capital at
March 31, 2003. Excess capital would increase to
$267.7 million using the well-capitalized minimums that we
will be subject to upon the expiration of our capital
requirement on June 30, 2003 described above.

We believe that, under current regulations, the
Bank will continue to meet its well-capitalized
minimum capital requirements in the foreseeable future. The
Banks regulatory capital compliance could be impacted,
however, by a number of factors, such as changes to applicable
regulations, adverse action by our regulators, changes in the
Banks mix of assets, interest rate fluctuations or
significant changes in the economy in areas where the Bank has
most of its loans. Any of these factors could cause our actual
future results to vary from anticipated future results and
consequently could have an adverse impact on the ability of the
Bank to meet its future minimum capital requirements.

KEY OPERATING RISKS

Like all businesses, we assume a certain amount
of risk in order to earn returns on our capital. The following
is a summary discussion of key operating risks. For further
information on these and other key operating risks, refer to
IndyMacs annual report on Form 10-K for the year
ended December 31, 2002.

38



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##### 



INTEREST RATE RISK

Due to the characteristics of our financial
assets and liabilities and the nature of our business
activities, our financial position and results of operations may
be materially affected by changes in interest rates in various
ways. While we have devised and implemented a comprehensive
asset/ liability management strategy that seeks, on an economic
and an accounting basis, to mitigate significant fluctuations in
our financial position and results of operations likely to be
caused by market interest rate changes, there can be no
assurance that this strategy (including assumptions concerning
the correlation thought to exist among different types of
instruments) or its implementation will be successful in any
particular interest rate environment.

VALUATION RISK

In connection with the loan sale process, we
retain certain assets for which the market is limited and
illiquid. As a result, valuations are derived using complex
modeling and significant assumptions and judgments, in the
absence of third party market quotations or sale information to
value such assets. The assets include AAA-rated and agency
interest-only securities, MSRs, non-investment grade securities
and residuals. In addition, from time to time, we may acquire
these types of securities from third party issuers. These assets
represented 6% of total assets and 67% of total equity at
March 31, 2003. The fair value of these assets could vary
significantly as market conditions change.

CREDIT RISK

A significant portion of our Investment Portfolio
consists of prime residential SFR loans held for investment, and
non-investment grade securities and residuals collateralized by
mortgage loans. We also provide construction lending to
consumers and developers to build residential properties which
have a higher credit risk profile than permanent mortgage loans.
While the majority of our loans are to prime quality borrowers
and secured by residential property, there is no guarantee that,
in the event of borrower default, we will be able to recoup the
full principal amount and interest due on a loan. We have
adopted underwriting and loan quality monitoring systems,
procedures and credit policies, including the establishment and
review of the allowance for loan losses, that management
believes are prudent and appropriate to minimize this risk by
tracking loan performance, assessing the likelihood of
nonperformance and diversifying our loan portfolio. Such
policies and procedures, however, may not prevent unexpected
losses that could adversely affect our results. In addition,
while we have discontinued our home improvement and manufactured
housing lending programs, we continue to liquidate portfolios of
these loans, which have greater credit risk than that of our
core mortgage loan portfolios. At March 31, 2003, the book
value of these non-core portfolios was $82.5 million, net
of reserves.

We also sell loans to GSEs, to outside investors,
and to securitization trusts. In these instances, we are subject
to repurchase risk in the event of breaches of representations
or warranties we make in connection with the loan sales. While
we have established what we believe to be adequate secondary
marketing reserves, there can be no guarantee that the amount
reserved is sufficient to cover all potential losses resulting
from such repurchases.

LIQUIDITY RISK/ ACCESS TO CAPITAL
MARKETS

We finance a substantial portion of our assets
through consumer deposits insured by the FDIC and through
borrowings from the FHLB. We also obtain financing from
investment and commercial banks. There is no guarantee that
these sources of funds will continue to be available to us, or
that our borrowings can be refinanced upon maturity, although we
are not aware of any trends, events or uncertainties that we
believe are reasonably likely to cause a decrease in our
liquidity from these sources.

We utilize three sales channels to sell loans to
the secondary market: whole loan sales, sales to the GSEs, and
private-label securitizations. A disruption in the
securitization market could adversely impact our ability to fund
mortgage loans and our gains on sale, leading to a corresponding
decrease in revenue and earnings.

39



---



##### 



Likewise, a deterioration in the performance of
our private-label securities could adversely impact the
availability and pricing of future transactions.


GOVERNMENT REGULATION AND MONETARY
POLICY

The banking industry in general is extensively
regulated at the federal and state levels. Insured depository
institutions and their holding companies are subject to
comprehensive regulation, supervision, and examination by
financial regulatory authorities covering all aspects of their
organization, management and operations. The OTS and the FDIC
are the primary federal regulatory agencies for us and our
affiliated entities. In addition to their regulatory powers,
these two agencies also have significant enforcement authority
that they can use to address unsafe and unsound banking
practices, violations of laws, and capital and operational
deficiencies. Accordingly, the actions of those governmental
authorities responsible for regulatory, fiscal and monetary
affairs can have a significant impact on the activities of
financial services firms such as ours. Our operations are also
subject to regulation at the state level, including a variety of
consumer protection provisions. Banking institutions are further
affected by the various monetary and fiscal policies of the
U.S. government, which can influence financial regulatory
actions.

COMPETITION

We face significant competition in acquiring and
selling loans. In our mortgage banking operations, we compete
with other mortgage bankers, GSEs, established third party
lending programs, investment banking firms, banks, savings and
loan associations, and other lenders and entities purchasing
mortgage assets. With regard to mortgage-backed securities
issued through our mortgage banking operations, we face
competition from other investment opportunities available to
prospective investors. We estimate our market share of the
U.S. mortgage market to be less than 1%. A number of our
competitors have significantly larger market share and financial
resources. While we believe our small market share creates
opportunities for growth, there is no assurance that we can
effectively compete with these entities in the future.

The GSEs have made and we believe will continue
to make significant technological and economic advances to
broaden their customer bases. When the GSEs contract or expand,
there are both positive and negative impacts on our mortgage
banking lending operations. As GSEs expand, additional liquidity
is brought to the market, and loan products can be resold more
quickly. Conversely, expanding GSEs increase competition for
loans, which may reduce profit margins on loan sales. We seek to
address these competitive pressures by making a strong effort to
maximize our use of technology, by diversifying into other
residential mortgage products that are less affected by GSEs,
and by operating in a more cost-effective manner than our
competitors. There can be no assurance that these efforts will
be successful.

The primary competition for our Mortgage Banking
Group comes from banks and other financial institutions and
mortgage companies. We seek to compete with financial
institutions and mortgage companies through an emphasis on
quality of service, diversified products and maximum use of
technology.

OTHER RISKS

We are subject to various other risks, including
changes in the demand for mortgage loans, which historically
tends to decrease as interest rates increase. Also, a majority
of our loan acquisitions are geographically concentrated in
certain states, including California, New York, Florida and New
Jersey. Any adverse economic conditions in these markets could
cause the number of loans acquired to decrease and delinquencies
to increase, causing a corresponding decline in revenues.
Lastly, there are no guarantees as to our degree of success in
managing loan portfolio concentrations, anticipating and taking
advantage of technological advances, or executing upon our
growth plans for our mortgage banking operations.

40



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##### 



CRITICAL ACCOUNTING POLICIES

Various elements of our accounting policies, by
their nature, are inherently subject to estimation techniques,
valuation assumptions and other subjective assessments. In
particular, we have identified five policies, that, due to the
judgments, estimates and assumptions inherent in those policies
are critical to an understanding of our financial statements.
These policies relate to (a) the valuation of AAA-rated and
agency interest-only securities; (b) the valuation of MSRs;
(c) the valuation of non-investment grade securities and
residuals; (d) the methodology for determining our
allowance for loan losses; and (e) the valuation of our
secondary market reserve. Management discusses these critical
accounting policies and related judgments with IndyMacs
audit committee and external auditors on a quarterly basis. We
believe that the judgments, estimates and assumptions used in
the preparation of our consolidated financial statements are
appropriate given the factual circumstances at the time.
However, given the sensitivity of our consolidated financial
statements to these critical accounting policies, the use of
other judgments, estimates and assumptions could result in
material differences in our results of operations or financial
condition. For further information on the Companys
critical accounting policies, refer to IndyMacs annual
report on Form 10-K for the year ended December 31,
2002.



|        |                                                              
|------- | -------------------------------------------------------------
|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURE
    ABOUT MARKET RISK

See Overall Interest Rate Risk
Management above for quantitative and qualitative
disclosure about market risk on page 27.

41



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##### 





|        |                                     
|------- | ------------------------------------
|ITEM 1. | FINANCIAL STATEMENTS
    (UNAUDITED)

INDYMAC BANCORP, INC. AND
SUBSIDIARIES



CONSOLIDATED BALANCE SHEETS


|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |         |           |           |           | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------- | ----------------------- | ------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | --------- | --------- | --------- | ------- | --------- | --------- | --------- | 
|                                                                                                                                                                                                                                                                                                                 |                           | March 31,               |                                 | December 31,                                                                                                                              
|                                                                                                                                                                                                                                                                                                                 |                           | 2003                    |                                 | 2002                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                 |                           | (Unaudited)             |                                 |                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                 |                           |                        
|                                                                                                                                                                                                                                                                                                                 |                           | (Dollars in thousands) 
|ASSETS                                                                                                                                                                                                                                                                                                          
|Cash and cash equivalents                                                                                                                                                                                                                                                                                        |                           | $                       | 130,409                         |                                                                                                                                            |           | $         | 196,720   |        
|Securities classified as trading
    ($100.0 million and $472.0 million pledged as
    collateral for repurchase agreements at March 31, 2003 and
    December 31, 2002, respectively)                                                                                                                           |                           |                         | 249,378                         |                                                                                                                                            |           |           | 765,883   |        
|Mortgage-backed securities available for sale,
    amortized cost of $1.4 billion and $1.6 billion at
    March 31, 2003 and December 31, 2002, respectively
    ($1.3 billion and $974.2 million pledged as collateral
    for repurchase agreements at March 31, 2003 and
    December 31, 2002, respectively) |                           |                         | 1,384,481                       |                                                                                                                                            |           |           | 1,573,210 |        
|Loans receivable:                                                                                                                                                                                                                                                                                                |                           |                         |                                 |                                                                                                                                            |           |           |           |        
|                                                                                                                                                                                                                                                                                                                 | Loans held for sale       |                         |                                 |                                                                                                                                            |           |           |           |         |          
|                                                                                                                                                                                                                                                                                                                 |                           | Prime                   |                                 |                                                                                                                                            | 2,062,294 |           |           |         | 1,939,780 |          
|                                                                                                                                                                                                                                                                                                                 |                           | Subprime                |                                 |                                                                                                                                            | 450,902   |           |           |         | 213,405   |          
|                                                                                                                                                                                                                                                                                                                 |                           | Consumer lot loans      |                                 |                                                                                                                                            | 97,668    |           |           |         | 74,498    |          
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |        
|                                                                                                                                                                                                                                                                                                                 |                           |                         | Total loans held for sale       |                                                                                                                                            |           | 2,610,864 |           |         |           | 2,227,683 |          
|                                                                                                                                                                                                                                                                                                                 | Loans held for investment |                         |                                 |                                                                                                                                            |           |           |           |         |          
|                                                                                                                                                                                                                                                                                                                 |                           | SFR mortgage            |                                 |                                                                                                                                            | 2,218,100 |           |           |         | 2,096,517 |          
|                                                                                                                                                                                                                                                                                                                 |                           | Land and other mortgage |                                 |                                                                                                                                            | 103,744   |           |           |         | 130,454   |          
|                                                                                                                                                                                                                                                                                                                 |                           | Builder construction    |                                 |                                                                                                                                            | 508,604   |           |           |         | 482,408   |          
|                                                                                                                                                                                                                                                                                                                 |                           | Consumer construction   |                                 |                                                                                                                                            | 900,428   |           |           |         | 875,335   |          
|                                                                                                                                                                                                                                                                                                                 |                           | Income property         |                                 |                                                                                                                                            | 62,825    |           |           |         | 64,053    |          
|                                                                                                                                                                                                                                                                                                                 |                           | HELOC                   |                                 |                                                                                                                                            | 391,002   |           |           |         | 312,881   |          
|                                                                                                                                                                                                                                                                                                                 | Allowance for loan losses |                         |                                 | (50,246                                                                                                                                    | )         |           |           | (50,761 | )        
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |        
|                                                                                                                                                                                                                                                                                                                 |                           |                         | Total loans held for investment |                                                                                                                                            |           | 4,134,457 |           |         |           | 3,910,887 |          
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |        
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 | Total loans receivable ($1.7 billion pledged
    as collateral for repurchase agreements at both March 31,
    2003 and December 31, 2002) |           |           | 6,745,321 |         |           |           | 6,138,570 | 
|Mortgage servicing rights                                                                                                                                                                                                                                                                                        |                           |                         | 343,544                         |                                                                                                                                            |           |           | 300,539   |        
|Investment in Federal Home Loan Bank stock, at
    cost                                                                                                                                                                                                                                                          |                           |                         | 192,833                         |                                                                                                                                            |           |           | 155,443   |        
|Interest receivable                                                                                                                                                                                                                                                                                              |                           |                         | 41,473                          |                                                                                                                                            |           |           | 47,089    |        
|Goodwill and other intangible assets                                                                                                                                                                                                                                                                             |                           |                         | 34,318                          |                                                                                                                                            |           |           | 34,549    |        
|Foreclosed assets                                                                                                                                                                                                                                                                                                |                           |                         | 27,871                          |                                                                                                                                            |           |           | 36,526    |        
|Other assets                                                                                                                                                                                                                                                                                                     |                           |                         | 326,964                         |                                                                                                                                            |           |           | 325,925   |        
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |        
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 | Total assets                                                                                                                               |           | $         | 9,476,592 |         |           | $         | 9,574,454 | 
|                                                                                                                                                                                                                                                                                                                 |                           |                         |                                 |                                                                                                                                            |           |           |           |        

42



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##### 







INDYMAC BANCORP, INC. AND
SUBSIDIARIES


CONSOLIDATED BALANCE SHEETS 
(Continued)

|                                         |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |           |           | 
|---------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | --------- | ------------ | --------- | - | --------- | --------- | --------- | 
|                                         |                                                                                                                                                                                                                                  | March 31,                                  |           | December 31,
|                                         |                                                                                                                                                                                                                                  | 2003                                       |           | 2002        
|                                         |                                                                                                                                                                                                                                  |                                            |           |             
|                                         |                                                                                                                                                                                                                                  | (Unaudited)                                |           |             
|                                         |                                                                                                                                                                                                                                  |                                           
|                                         |                                                                                                                                                                                                                                  | (Dollars in thousands)                    
|LIABILITIES AND SHAREHOLDERS
    EQUITY
|Deposits                                 |                                                                                                                                                                                                                                  | $                                          | 3,476,181 |              |           | $ | 3,140,502 |          
|Advances from Federal Home Loan Bank     |                                                                                                                                                                                                                                  |                                            | 3,322,771 |              |           |   | 2,721,783 |          
|Other borrowings                         |                                                                                                                                                                                                                                  |                                            | 1,402,134 |              |           |   | 2,491,715 |          
|Trust preferred securities               |                                                                                                                                                                                                                                  |                                            | 116,957   |              |           |   | 116,819   |          
|Other liabilities                        |                                                                                                                                                                                                                                  |                                            | 275,766   |              |           |   | 253,670   |          
|                                         |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |          
|                                         |                                                                                                                                                                                                                                  | Total liabilities                          |           |              | 8,593,809 |   |           |           | 8,724,489 | 
|Shareholders Equity                     |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |          
|                                         | Preferred stock  authorized,
    10,000,000 shares of $0.01 par value; none issued                                                                                                                                              |                                            |           |             |           |   |           |          |          
|                                         | Common stock  authorized,
    200,000,000 shares of $0.01 par value; issued
    84,343,263 shares (55,191,490 outstanding) at
    March 31, 2003 and issued 83,312,516 shares
    (54,829,486 outstanding) at December 31, 2002 |                                            |           | 843          |           |   |           | 840       |          
|                                         | Additional paid-in-capital                                                                                                                                                                                                       |                                            |           | 1,011,763    |           |   |           | 1,007,936 |          
|                                         | Accumulated other comprehensive loss                                                                                                                                                                                             |                                            |           | (19,780      | )         |   |           | (17,747   | )        
|                                         | Retained earnings                                                                                                                                                                                                                |                                            |           | 409,134      |           |   |           | 377,707   |          
|                                         | Treasury stock, 29,151,773 shares and
    29,130,061 shares at March 31, 2003 and
    December 31, 2002, respectively                                                                                                            |                                            |           | (519,177     | )         |   |           | (518,771  | )        
|                                         |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |          
|                                         |                                                                                                                                                                                                                                  | Total shareholders equity                 |           |              | 882,783   |   |           |           | 849,965   | 
|                                         |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |          
|                                         |                                                                                                                                                                                                                                  | Total liabilities and shareholders equity |           | $            | 9,476,592 |   |           | $         | 9,574,454 | 
|                                         |                                                                                                                                                                                                                                  |                                            |           |              |           |   |           |          

The accompanying notes are an integral part of
these statements.

43



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##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES



CONSOLIDATED STATEMENTS OF EARNINGS


|                                           |                                         |                                                         |        |        |         |   |        |        |         | 
|------------------------------------------ | --------------------------------------- | ------------------------------------------------------- | ------ | ------ | ------- | - | ------ | ------ | ------- | 
|                                           |                                         |                                                        
|                                           |                                         | For the Three Months                                   
|                                           |                                         | Ended March 31,                                        
|                                           |                                         |                                                        
|                                           |                                         | 2003                                                    |        | 2002  
|                                           |                                         |                                                         |        |       
|                                           |                                         |                                                        
|                                           |                                         | (Unaudited)                                            
|                                           |                                         | (Dollars in thousands,                                 
|                                           |                                         | except per share data)                                 
|Interest income                            |                                         |                                                         |        |        |         |   |        |       
|Mortgage-backed and other securities       |                                         | $                                                       | 20,961 |        |         | $ | 28,882 |       
|Loans held for sale                        |                                         |                                                         |        |        |         |   |        |       
|                                           | Prime                                   |                                                         |        | 37,425 |         |   |        | 33,327 |        
|                                           | Subprime                                |                                                         |        | 6,243  |         |   |        | 3,416  |        
|                                           | Consumer lot loans                      |                                                         |        | 1,533  |         |   |        |       |        
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total loans held for sale                               |        |        | 45,201  |   |        |        | 36,743  | 
|Loans held for investment                  |                                         |                                                         |        |        |         |   |        |       
|                                           | SFR mortgage                            |                                                         |        | 29,514 |         |   |        | 26,732 |        
|                                           | Land and other mortgage                 |                                                         |        | 2,301  |         |   |        | 2,862  |        
|                                           | Builder construction                    |                                                         |        | 8,601  |         |   |        | 10,293 |        
|                                           | Consumer construction                   |                                                         |        | 14,396 |         |   |        | 13,977 |        
|                                           | Income property                         |                                                         |        | 1,119  |         |   |        | 1,106  |        
|                                           | HELOC                                   |                                                         |        | 4,147  |         |   |        | 1,305  |        
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total loans held for investment                         |        |        | 60,078  |   |        |        | 56,275  | 
|Other                                      |                                         |                                                         | 1,957  |        |         |   | 1,782  |       
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total interest income                                   |        |        | 128,197 |   |        |        | 123,682 | 
|Interest expense                           |                                         |                                                         |        |        |         |   |        |       
|Deposits                                   |                                         |                                                         | 21,687 |        |         |   | 31,308 |       
|Advances from Federal Home Loan Bank       |                                         |                                                         | 25,558 |        |         |   | 24,389 |       
|Trust preferred securities                 |                                         |                                                         | 2,763  |        |         |   | 2,756  |       
|Borrowings                                 |                                         |                                                         | 15,164 |        |         |   | 11,475 |       
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total interest expense                                  |        |        | 65,172  |   |        |        | 69,928  | 
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Net interest income                                     |        |        | 63,025  |   |        |        | 53,754  | 
|Provision for loan losses                  |                                         |                                                         | 3,100  |        |         |   | 4,186  |       
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Net interest income after provision for loan
    losses |        |        | 59,925  |   |        |        | 49,568  | 
|Other income                               |                                         |                                                         |        |        |         |   |        |       
|                                           | Gain on sale of loans                   |                                                         |        | 83,784 |         |   |        | 77,466 |        
|                                           | Service fee income                      |                                                         |        | 2,383  |         |   |        | 7,822  |        
|                                           | Loss on mortgage-backed securities, net |                                                         |        | (6,910 | )       |   |        | (6,988 | )      
|                                           | Fee and other income                    |                                                         |        | 17,727 |         |   |        | 13,609 |        
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total other income                                      |        |        | 96,984  |   |        |        | 91,909  | 
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Net revenues                                            |        |        | 156,909 |   |        |        | 141,477 | 
|Other expense                              |                                         |                                                         |        |        |         |   |        |       
|                                           | Operating expenses                      |                                                         |        | 95,658 |         |   |        | 79,554 |        
|                                           | Amortization of other intangible assets |                                                         |        | 231    |         |   |        | 299    |        
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Total other expense                                     |        |        | 95,889  |   |        |        | 79,853  | 
|                                           |                                         |                                                         |        |        |         |   |        |       
|Earnings before provision for income taxes |                                         |                                                         | 61,020 |        |         |   | 61,624 |       
|                                           | Provision for income taxes              |                                                         |        | 24,103 |         |   |        | 25,605 |        
|                                           |                                         |                                                         |        |        |         |   |        |       
|                                           |                                         | Net earnings                                            |        | $      | 36,917  |   |        | $      | 36,019  | 
|                                           |                                         |                                                         |        |        |         |   |        |       
|Earnings per share                         |                                         |                                                         |        |        |         |   |        |       
|                                           | Basic                                   |                                                         | $      | 0.67   |         |   | $      | 0.60   |        
|                                           | Diluted                                 |                                                         | $      | 0.66   |         |   | $      | 0.58   |        
|Weighted average shares outstanding        |                                         |                                                         |        |        |         |   |        |       
|                                           | Basic                                   |                                                         |        | 54,827 |         |   |        | 60,228 |        
|                                           | Diluted                                 |                                                         |        | 55,979 |         |   |        | 62,043 |        
|Dividend Declared per Share                |                                         | $                                                       | 0.10   |        |         |   |       |       

The accompanying notes are an integral part of
these statements.

44



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##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS
EQUITY AND COMPREHENSIVE INCOME

|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|--------------------------------------------------------------- |  | ---------------------- | ---------- | ------ |  | ---------- | --- | ------------- |  | -------- | --------- | ------------- |  | -------- | ------- | ------------- |  | - | ------- | - |  | - | ------ | - |  | - | -------- | - |  | - | ------- | -
|                                                                |  |                        |            |        |  |            |     | Accumulated   |  |          |           |               |  |          |         |              
|                                                                |  |                        |            |        |  |            |     | Other         |  |          |           |               |  |          |         |              
|                                                                |  |                        |            |        |  | Additional |     | Comprehensive |  |          |           | Total         |  |          |         | Total        
|                                                                |  | Shares                 |            | Common |  | Paid-In-   |     | Income        |  | Retained |           | Comprehensive |  | Treasury |         | Shareholders
|                                                                |  | Outstanding            |            | Stock  |  | Capital    |     | (Loss)        |  | Earnings |           | Income        |  | Stock    |         | Equity       
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |              
|                                                                |  |                       
|                                                                |  | (Unaudited)           
|                                                                |  | (Dollars in thousands)
|Balance at December 31, 2001                                    |  |                        | 60,366,266 |        |  | $          | 833 |               |  | $        | 996,649   |               |  | $        | 570     |               |  | $ | 234,314 |   |  | $ |       |   |  | $ | (387,228 | ) |  | $ | 845,138 |  
|Common stock options exercised                                  |  |                        | 161,224    |        |  |            | 2   |               |  |          | 3,172     |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 3,174   |  
|Directors and officers notes
    receivable                   |  |                        |           |        |  |            |    |               |  |          | 18        |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 18      |  
|Deferred compensation, restricted stock                         |  |                        | 11,526     |        |  |            |    |               |  |          | 404       |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 404     |  
|Net loss on mortgage securities available for sale              |  |                        |           |        |  |            |    |               |  |          |          |               |  |          | (2,995  | )             |  |   |        |   |  |   | (2,995 | ) |  |   |         |   |  |   | (2,995  | )
|Net unrealized gain on derivatives used in cash
    flow hedges |  |                        |           |        |  |            |    |               |  |          |          |               |  |          | 2,593   |               |  |   |        |   |  |   | 2,593  |   |  |   |         |   |  |   | 2,593   |  
|Dividend reinvestment plan                                      |  |                        | 599        |        |  |            |    |               |  |          | 15        |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 15      |  
|Purchases of common stock                                       |  |                        | (8,665     | )      |  |            |    |               |  |          |          |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   | (205     | ) |  |   | (205    | )
|Net earnings                                                    |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   | 36,019  |   |  | $ | 36,019 |   |  |   |         |   |  |   | 36,019  |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|Total comprehensive income                                      |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   |        |   |  | $ | 35,617 |   |  |   |         |   |  |   |        |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|Balance at March 31, 2002                                       |  |                        | 60,530,950 |        |  | $          | 835 |               |  | $        | 1,000,258 |               |  | $        | 168     |               |  | $ | 270,333 |   |  |   |        |   |  | $ | (387,433 | ) |  | $ | 884,161 |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|Balance at December 31, 2002                                    |  |                        | 54,829,486 |        |  | $          | 840 |               |  | $        | 1,007,936 |               |  | $        | (17,747 | )             |  | $ | 377,707 |   |  | $ |       |   |  | $ | (518,771 | ) |  | $ | 849,965 |  
|Common stock options exercised                                  |  |                        | 222,020    |        |  |            | 3   |               |  |          | 3,313     |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 3,316   |  
|Directors and officers notes
    receivable                   |  |                        |           |        |  |            |    |               |  |          | 25        |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 25      |  
|Deferred compensation, restricted stock                         |  |                        | 161,696    |        |  |            |    |               |  |          | 489       |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   | 489     |  
|Net loss on mortgage securities available for sale              |  |                        |           |        |  |            |    |               |  |          |          |               |  |          | (558    | )             |  |   |        |   |  |   | (558   | ) |  |   |         |   |  |   | (558    | )
|Net unrealized loss on derivatives used in cash
    flow hedges |  |                        |           |        |  |            |    |               |  |          |          |               |  |          | (1,475  | )             |  |   |        |   |  |   | (1,475 | ) |  |   |         |   |  |   | (1,475  | )
|Dividend reinvestment plan                                      |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   |         |   |  |   |         |  
|Purchases of common stock                                       |  |                        | (21,712    | )      |  |            |    |               |  |          |          |               |  |          |        |               |  |   |        |   |  |   |       |   |  |   | (406     | ) |  |   | (406    | )
|Cash dividends                                                  |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   | (5,490  | ) |  |   |       |   |  |   |         |   |  |   | (5,490  | )
|Net earnings                                                    |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   | 36,917  |   |  | $ | 36,917 |   |  |   |         |   |  |   |        |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|Total comprehensive income                                      |  |                        |           |        |  |            |    |               |  |          |          |               |  |          |        |               |  |   |        |   |  | $ | 34,844 |   |  |   |         |   |  |   |        |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  
|Balance at March 31, 2003                                       |  |                        | 55,191,490 |        |  | $          | 843 |               |  | $        | 1,011,763 |               |  | $        | (19,780 | )             |  | $ | 409,134 |   |  |   |        |   |  | $ | (519,177 | ) |  | $ | 882,783 |  
|                                                                |  |                        |            |        |  |            |     |               |  |          |           |               |  |          |         |               |  |   |         |   |  |   |        |   |  |   |          |   |  |   |         |  

The accompanying notes are an integral part of
these statements.

45



---



##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES



CONSOLIDATED STATEMENTS OF CASH
FLOWS


|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |          |          |          |  
|-------------------------------------------------------------------------- | ----------------------------------------------------------------------------------- | -------------------------------------------- | ------------------------------------------------------------------------------------------------------------ | ---------- | -------- | -------- | ------- | -------- | -------- | -------- | -
|                                                                           |                                                                                     |                                             
|                                                                           |                                                                                     | For the Three Months                        
|                                                                           |                                                                                     | Ended March 31,                             
|                                                                           |                                                                                     |                                             
|                                                                           |                                                                                     | 2003                                         |                                                                                                              | 2002      
|                                                                           |                                                                                     |                                              |                                                                                                              |           
|                                                                           |                                                                                     |                                             
|                                                                           |                                                                                     | (Unaudited)                                 
|                                                                           |                                                                                     | (Dollars in thousands)                      
|Cash flows from operating
    activities:                                  |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           | Net earnings                                                                        |                                              | $                                                                                                            | 36,917     |          |          | $       | 36,019   |         
|                                                                           | Adjustments to reconcile net earnings to net cash
    used in operating activities: |                                              |                                                                                                              |            |          |          |         |          |         
|                                                                           |                                                                                     | Total amortization and depreciation          |                                                                                                              |            | 51,005   |          |         |          | 14,748   |         
|                                                                           |                                                                                     | Gain on sale of loans                        |                                                                                                              |            | (83,784  | )        |         |          | (77,466  | )       
|                                                                           |                                                                                     | Loss on mortgage-backed securities, net      |                                                                                                              |            | 6,910    |          |         |          | 6,988    |         
|                                                                           |                                                                                     | Provision for loan losses                    |                                                                                                              |            | 3,100    |          |         |          | 4,186    |         
|                                                                           |                                                                                     | Net decrease in other assets and liabilities |                                                                                                              |            | 39,187   |          |         |          | 33,419   |         
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Net cash provided by operating activities before
    activity for trading securities and held for sale loans |            |          | 53,335   |         |          |          | 17,894   |  
|                                                                           |                                                                                     | Net sales (purchases) of trading securities  |                                                                                                              |            | 527,366  |          |         |          | (117,438 | )       
|                                                                           |                                                                                     | Net (purchases) sales of loans held for sale |                                                                                                              |            | (658,369 | )        |         |          | 594,873  |         
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Net cash (used in) provided by operating
    activities                                                      |            |          | (77,668  | )       |          |          | 495,329  |  
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Cash flows from investing
    activities:                                  |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           | Net sales of and payments from loans held for
    investment                        |                                              |                                                                                                              | 24,900     |          |          |         | 153,648  |         
|                                                                           | Net purchases (sales) of mortgage securities
    available for sale                 |                                              |                                                                                                              | 184,193    |          |          |         | (41,609  | )       
|                                                                           | Net increase in investment in Federal Home Loan
    Bank stock, at cost             |                                              |                                                                                                              | (37,390    | )        |          |         | (5,713   | )       
|                                                                           | Net purchases of property, plant and equipment                                      |                                              |                                                                                                              | (5,096     | )        |          |         | (13,173  | )       
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Net cash provided by investing activities                                                                    |            |          | 166,607  |         |          |          | 93,153   |  
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Cash flows from financing
    activities:                                  |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           | Net increase (decrease) in deposits                                                 |                                              |                                                                                                              | 335,679    |          |          |         | (124,921 | )       
|                                                                           | Net increase in advances from Federal Home Loan
    Bank                            |                                              |                                                                                                              | 600,914    |          |          |         | 81,266   |         
|                                                                           | Net decrease in borrowings                                                          |                                              |                                                                                                              | (1,089,776 | )        |          |         | (317,883 | )       
|                                                                           | Net proceeds from issuance of common stock and
    exercise of stock options        |                                              |                                                                                                              | 3,829      |          |          |         | 3,611    |         
|                                                                           | Cash dividends paid                                                                 |                                              |                                                                                                              | (5,490     | )        |          |         |         |         
|                                                                           | Purchases of common stock                                                           |                                              |                                                                                                              | (406       | )        |          |         | (205     | )       
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Net cash used in financing activities                                                                        |            |          | (155,250 | )       |          |          | (358,132 | )
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Net (decrease) increase in cash and cash
    equivalents                   |                                                                                     |                                              | (66,311                                                                                                      | )          |          |          | 230,350 |         
|Cash and cash equivalents at beginning of period                           |                                                                                     |                                              | 196,720                                                                                                      |            |          |          | 153,295 |         
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Cash and cash equivalents at end of period                                 |                                                                                     | $                                            | 130,409                                                                                                      |            |          | $        | 383,645 |         
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Supplemental cash flow information:                                        |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Cash paid for interest                                                                                       |            | $        | 63,639   |         |          | $        | 64,933   |  
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Cash paid for income taxes                                                                                   |            | $        | 1,061    |         |          | $        | 566      |  
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|Supplemental disclosure of noncash investing
    and financing activities: |                                                                                     |                                              |                                                                                                              |            |          |          |         |         
|                                                                           |                                                                                     |                                              | Net transfer of loans held for sale to loans held
    for investment                                         |            | $        | 261,833  |         |          | $        | 148,546  |  
|                                                                           |                                                                                     |                                              |                                                                                                              |            |          |          |         |         

The accompanying notes are an integral part of
these statements.

46



---



##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS


March 31, 2003


(Unaudited)




|         |                      
|-------- | ---------------------
|Note 1  | Basis of Presentation

IndyMac Bancorp, Inc. is a savings and loan
holding company. References to IndyMac Bancorp refer
to the parent company alone while references to
IndyMac or we refer to IndyMac Bancorp
and its consolidated subsidiaries. Our primary business is
mortgage banking. We offer a wide array of home mortgage
products using a technology-based approach, leveraged across
multiple products, channels and customers.

The consolidated financial statements include the
accounts of IndyMac Bancorp and its subsidiaries, including
IndyMac Bank®, F.S.B. (IndyMac Bank). All
significant intercompany balances and transactions with
IndyMacs consolidated subsidiaries have been eliminated in
consolidation. The consolidated financial statements of IndyMac
are prepared in conformity with accounting principles generally
accepted in the United States of America (US GAAP).
The foregoing financial statements are unaudited; however, in
the opinion of management, all adjustments, consisting only of
normal recurring adjustments necessary for a fair statement of
the results for the interim periods have been included.
Operating results for the three months ended March 31, 2003
are not necessarily indicative of the results that may be
expected for the year ending December 31, 2003. For further
information, refer to the consolidated financial statements and
footnotes thereto included in IndyMacs annual report on
Form 10-K for the year ended December 31, 2002.

Note 2  Securities

The following table details our securities
classified as trading and mortgage-backed securities available
for sale as of March 31, 2003 and December 31, 2002,
respectively.

|                                               |                                               |                        |  |              |           |  |  |           |           | 
|---------------------------------------------- | --------------------------------------------- | ---------------------- |  | ------------ | --------- |  |  | --------- | --------- | 
|                                               |                                               | March 31,              |  | December 31,
|                                               |                                               | 2003                   |  | 2002        
|                                               |                                               |                        |  |             
|                                               |                                               |                       
|                                               |                                               | (Dollars in thousands)
|Securities Classified as Trading:              |                                               |                        |  |              |           |  |  |          
|                                               | AAA-rated and agency interest-only securities |                        |  | 156,212      |           |  |  | 187,060   |          
|                                               | AAA-rated principal-only securities           |                        |  | 3,295        |           |  |  | 79,554    |          
|                                               | U.S. Treasury securities                      |                        |  |             |           |  |  | 282,219   |          
|                                               | AAA-rated non-agency securities               |                        |  |             |           |  |  | 101,185   |          
|                                               | AAA-rated agency securities                   |                        |  |             |           |  |  | 25,055    |          
|                                               | Other investment grade securities             |                        |  | 9,067        |           |  |  | 9,114     |          
|                                               | Other non-investment grade securities         |                        |  | 2,806        |           |  |  | 2,956     |          
|                                               | Non-investment grade residual securities      |                        |  | 77,998       |           |  |  | 78,740    |          
|                                               |                                               |                        |  |              |           |  |  |          
|                                               |                                               | Total                  |  |              | 249,378   |  |  |           | 765,883   | 
|                                               |                                               |                        |  |              |           |  |  |          
|Mortgage-backed Securities Available for Sale: |                                               |                        |  |              |           |  |  |          
|                                               | AAA-rated non-agency securities               |                        |  | 1,253,963    |           |  |  | 1,406,321 |          
|                                               | AAA-rated agency securities                   |                        |  | 86,013       |           |  |  | 123,269   |          
|                                               | Other investment grade securities             |                        |  | 37,959       |           |  |  | 39,258    |          
|                                               | Other non-investment grade securities         |                        |  | 6,546        |           |  |  | 4,362     |          
|                                               |                                               |                        |  |              |           |  |  |          
|                                               |                                               | Total                  |  |              | 1,384,481 |  |  |           | 1,573,210 | 
|                                               |                                               |                        |  |              |           |  |  |          

47



---



##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

Note 3  Segment
Reporting

IndyMac operates through its three main segments:
IndyMac Mortgage Bank, IndyMac Consumer Bank and the Investment
Portfolio Group. IndyMac Mortgage Bank is centered on providing
consumers with mortgage products through relationships with the
Companys business customers  mortgage brokers,
mortgage bankers, financial institutions, real estate
professionals and homebuilders. IndyMac Consumer Bank provides
the platform for the mortgage and deposit services that IndyMac
offers directly to consumers. Loans produced by IndyMac Mortgage
Bank and IndyMac Consumer Bank are then securitized through the
issuance of mortgage-backed securities, sold to
government-sponsored enterprises, resold in bulk whole loan
sales to investors, or transferred to and retained by our
Investment Portfolio Group. The Investment Portfolio Group
serves as the main link to customers whose mortgages we service.
Through its investments in single-family residential mortgages,
mortgage-backed securities and mortgage servicing rights, it
serves a critical support function for IndyMacs mortgage
lending operations.

Prior to 2003, we managed our business through
only two operating segments: Mortgage Banking and Investment
Portfolio. Previously, our consumer mortgage loan production
business units were included with Mortgage Banking, and our
consumer banking operations were included as overhead to the
Company, or Other. Segment information for 2002,
including a change in the allocation method of interest expense
to the operating segments, has been adjusted to conform to the
current method of segment disclosure.

The profitability of each operating segment is
measured on a fully-leveraged basis after allocating capital
based on regulatory capital rules. The Company uses a
match-funded transfer pricing system to allocate net interest
income to the operating segments. Each operating segment is
allocated funding with maturities and interest rates matched
with the expected lives, repricing frequencies and financing
liquidities of the segments assets. Deposits receive a
funding credit using a similar methodology. The difference
between these allocations and the Companys actual net
interest income and capital levels resulting from centralized
management of funding costs is reported in the Other. Also
included in the Other are unallocated corporate costs such as
corporate salaries and related expenses, excess capital, and
non-recurring corporate items.

Segment information for the three months ended
March 31, 2003 and 2002 was as follows:

|                                  |                               |                        |           |          |  |            |         |        |  |              |           |        |  |   |         |         |   |   |           |         | 
|--------------------------------- | ----------------------------- | ---------------------- | --------- | -------- |  | ---------- | ------- | ------ |  | ------------ | --------- | ------ |  | - | ------- | ------- | - | - | --------- | ------- | 
|                                  |                               | IndyMac                |           | IndyMac  |  | Investment |         |        |  |             
|                                  |                               | Mortgage               |           | Consumer |  | Portfolio  |         |        |  |             
|                                  |                               | Bank                   |           | Bank     |  | Group      |         | Other  |  | Consolidated
|                                  |                               |                        |           |          |  |            |         |        |  |             
|                                  |                               |                       
|                                  |                               | (Dollars in thousands)
|Three months ended March 31, 2003 |                               |                        |           |          |  |            |         |        |  |              |           |        |  |   |         |         |   |   |           |        
|                                  | Net interest income (expense) |                        | $         | 43,751   |  |            | $       | 10,411 |  |              | $         | 19,085 |  |   | $       | (10,222 | ) |   | $         | 63,025  | 
|                                  | Net revenues (loss)           |                        |           | 116,499  |  |            |         | 37,703 |  |              |           | 20,292 |  |   |         | (17,585 | ) |   |           | 156,909 | 
|                                  | Net earnings (loss)           |                        |           | 45,531   |  |            |         | 9,843  |  |              |           | 6,499  |  |   |         | (24,956 | ) |   |           | 36,917  | 
|Assets as of March 31, 2003       |                               | $                      | 3,475,689 |          |  | $          | 921,996 |        |  | $            | 4,724,596 |        |  | $ | 354,311 |         |   | $ | 9,476,592 |        
|Three months ended March 31, 2002 |                               |                        |           |          |  |            |         |        |  |              |           |        |  |   |         |         |   |   |           |        
|                                  | Net interest income (expense) |                        | $         | 43,008   |  |            | $       | 8,525  |  |              | $         | 20,210 |  |   | $       | (17,989 | ) |   | $         | 53,754  | 
|                                  | Net revenues (loss)           |                        |           | 114,950  |  |            |         | 26,014 |  |              |           | 20,984 |  |   |         | (20,471 | ) |   |           | 141,477 | 
|                                  | Net earnings (loss)           |                        |           | 45,799   |  |            |         | 5,611  |  |              |           | 7,273  |  |   |         | (22,664 | ) |   |           | 36,019  | 
|Assets as of March 31, 2002       |                               | $                      | 2,823,225 |          |  | $          | 376,834 |        |  | $            | 3,455,356 |        |  | $ | 511,854 |         |   | $ | 7,167,269 |        

Note 4  Stock-Based
Compensation

We have two stock incentive plans, the 2002
Incentive Plan and the 2000 Stock Incentive Plan (collectively,
the Plans), which provide for the granting of
non-qualified stock options, incentive stock options, restricted
stock awards, performance stock awards, stock bonuses and other
awards to our employees

48



---



##### 



INDYMAC BANCORP, INC. AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

(including officers and directors). Awards are
granted at the average market price of our stock on the grant
date, vest over varying periods generally beginning at least one
year from the date of grant, and expire ten years from the date
of grant.

As permitted by SFAS 123, Accounting for
Stock-Based Compensation (SFAS 123),
we continue to measure and recognize compensation expense using
the intrinsic value method specified in Accounting Principles
Board Opinion No. 25, Accounting for Stock Issued
to Employees (APB 25). As required
under the provisions of SFAS 148, Accounting for
Stock-Based Compensation  Transition and
Disclosure, the following table discloses the pro
forma net income and pro forma basic and diluted earnings per
share had the fair value method been applied to all stock awards
for the three months ended March 31, 2003 and 2002:

|                           |             |                                  |   |        |        |   |   |        |        |  
|-------------------------- | ----------- | -------------------------------- | - | ------ | ------ | - | - | ------ | ------ | -
|                           |             |                                 
|                           |             | Three Months Ended              
|                           |             | March 31,                       
|                           |             |                                 
|                           |             | 2003                             |   | 2002  
|                           |             |                                  |   |       
|                           |             |                                 
|                           |             | (Dollars in thousands,          
|                           |             | except per share data)          
|Net Earnings               |             |                                  |   |        |        |   |   |       
|                           | As reported |                                  | $ | 36,917 |        |   | $ | 36,019 |       
|                           |             | Stock-based compensation expense |   |        | (5,010 | ) |   |        | (4,009 | )
|                           |             | Tax effect                       |   |        | 1,979  |   |   |        | 1,584  |  
|                           |             |                                  |   |        |        |   |   |       
|                           | Pro forma   |                                  | $ | 33,886 |        |   | $ | 33,594 |       
|                           |             |                                  |   |        |        |   |   |       
|Basic Earnings Per Share   |             |                                  |   |        |        |   |   |       
|                           | As reported |                                  | $ | 0.67   |        |   | $ | 0.60   |       
|                           | Pro forma   |                                  | $ | 0.62   |        |   | $ | 0.56   |       
|Diluted Earnings Per Share |             |                                  |   |        |        |   |   |       
|                           | As reported |                                  | $ | 0.66   |        |   | $ | 0.58   |       
|                           | Pro forma   |                                  | $ | 0.61   |        |   | $ | 0.54   |       

In addition, during the three months ended
March 31, 2003 and 2002, we recognized compensation expense
of $489 thousand ($296 thousand, net of taxes) and $404 thousand
($236 thousand, net of taxes), respectively, related to
restricted stock awards. These expenses were included in net
earnings as reported.

49



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##### 



ITEM 4.     CONTROLS
AND PROCEDURES

As of March 31, 2003, an evaluation was
performed under the supervision and with the participation of
the Companys management, including the Chief Executive
Officer (CEO) and Chief Financial Officer
(CFO), of the effectiveness of the design and
operation of the Companys disclosure controls and
procedures. Based on that evaluation, the Companys
management, including the CEO and CFO, concluded that the
Companys disclosure controls and procedures were effective
as of March 31, 2003. There have been no significant
changes in the Companys internal controls or in other
factors that could significantly affect internal controls
subsequent to March 31, 2003.

PART II. OTHER INFORMATION

ITEM 6.     EXHIBITS
AND REPORTS ON FORM 8-K

(a) Exhibits

|     |  |                                                                                                                                                          
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------
|99.1 |  | Chief Executive Officers Certification
    pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|99.2 |  | Chief Financial Officers Certification
    pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K

The Company filed a report on Form 8-K on
January 8, 2003. Items included: Item 5. Other Events
regarding the Stock Purchase Plan.

The Company filed a report on Form 8-K on
January 29, 2003. Items included: Item 5. Other Events
regarding Fourth Quarter 2002 Earnings.

The Company furnished a report on Form 8-K
on February 11, 2003. Items included: Item 9.
Regulation FD Disclosure regarding Retirement of Chairman.

50



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##### 



SIGNATURES

Pursuant to the requirements of Section 13
or 15(d) of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Pasadena,
State of California, on April 30, 2003 for the three months
ended March 31, 2003.



| |                      
| | ---------------------
| | INDYMAC BANCORP, INC.



| |     |                     
| | --- | --------------------
| | By: | /s/ MICHAEL W. PERRY

| |                                   
| | ----------------------------------
| |                                   
| | Michael W. Perry                  
| | Chairman of the Board of Directors
| | and Chief Executive Officer       



| |     |               
| | --- | --------------
| | By: | /s/ SCOTT KEYS

| |                             
| | ----------------------------
| |                             
| | Scott Keys                  
| | Executive Vice President and
| | Executive Vice President    
| | and Chief Financial Officer 

51



---



##### 



CERTIFICATION

I, Michael W. Perry, Chairman of the Board of
Directors and Chief Executive Officer of IndyMac Bancorp, Inc.
(IndyMac Bancorp), certify that:

1.     I have reviewed
this quarterly report on Form 10-Q of IndyMac Bancorp;

2.     Based on my
knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this quarterly
report;

3.     Based on my
knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in
all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;

4.     The
registrants other certifying officer and I are responsible
for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and
15d-14) for the registrant and we have:



| |                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) designed such disclosure controls and
    procedures to ensure that material information relating to the
    registrant, including its consolidated subsidiaries, is made
    known to us by others within those entities, particularly during
    the period in which this quarterly report is being prepared;
|
| | (b) evaluated the effectiveness of the
    registrants disclosure controls and procedures as of a
    date within 90 days prior to the filing date of this
    quarterly report (the Evaluation Date); and                                                                                                      
|
| | (c) presented in this quarterly report our
    conclusions about the effectiveness of the disclosure controls
    and procedures based on our evaluation as of the Evaluation Date;                                                                                                                                

5.     The
registrants other certifying officer and I have disclosed,
based on our most recent evaluation, to the registrants
auditors and the audit committee of registrants board of
directors (or persons performing the equivalent function):



| |                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) all significant deficiencies in the
    design or operation of internal controls which could adversely
    affect the registrants ability to record, process,
    summarize and report financial data and have identified for the
    registrants auditors any material weaknesses in internal
    controls; and
|
| | (b) any fraud, whether or not material, that
    involves management or other employees who have a significant
    role in the registrants internal controls; and                                                                                                                                                    

6.     The
registrants other certifying officer and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.



| |                                   
| | ----------------------------------
| | /s/ MICHAEL W. PERRY              
| |                                   
| | Michael W. Perry                  
| | Chairman of the Board of Directors
| | and Chief Executive Officer       

Date: April 30, 2003

52



---



##### 



CERTIFICATION

I, Scott Keys, Executive Vice President and Chief
Financial Officer of IndyMac Bancorp, Inc. (IndyMac
Bancorp), certify that:

1.     I have reviewed
this quarterly report on Form 10-Q of IndyMac Bancorp;

2.     Based on my
knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this quarterly
report;

3.     Based on my
knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in
all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;

4.     The
registrants other certifying officer and I are responsible
for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and
15d-14) for the registrant and we have:



| |                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) designed such disclosure controls and
    procedures to ensure that material information relating to the
    registrant, including its consolidated subsidiaries, is made
    known to us by others within those entities, particularly during
    the period in which this quarterly report is being prepared;
|
| | (b) evaluated the effectiveness of the
    registrants disclosure controls and procedures as of a
    date within 90 days prior to the filing date of this
    quarterly report (the Evaluation Date); and                                                                                                      
|
| | (c) presented in this quarterly report our
    conclusions about the effectiveness of the disclosure controls
    and procedures based on our evaluation as of the Evaluation Date;                                                                                                                                

5.     The
registrants other certifying officer and I have disclosed,
based on our most recent evaluation, to the registrants
auditors and the audit committee of registrants board of
directors (or persons performing the equivalent function):



| |                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) all significant deficiencies in the
    design or operation of internal controls which could adversely
    affect the registrants ability to record, process,
    summarize and report financial data and have identified for the
    registrants auditors any material weaknesses in internal
    controls; and
|
| | (b) any fraud, whether or not material, that
    involves management or other employees who have a significant
    role in the registrants internal controls; and                                                                                                                                                    

6.     The
registrants other certifying officer and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.



| |                            
| | ---------------------------
| | /s/ SCOTT KEYS             
| |                            
| | Scott Keys                 
| | Executive Vice President   
| | and Chief Financial Officer

Date: April 30, 2003

53