American Bank Reports Record Earnings for 2001

CONTACT: Mark W. Jaindl, President and Chief Executive Officer
Allentown, PA, January 18, 2002

American Bank (OTCBB: AMBK), serving the Lehigh Valley community in eastern Pennsylvania and recognized as a leading provider of Internet banking and financial services nationwide, today announced record earnings for the quarter and year ended December 31, 2001. Net income for the quarter was $401,000, or $.10 per share, an increase of $197,000 from the same period in the prior year. For the year ended December 31, 2001, American Bank posted net income of $1,338,000, or $.33 per share, an increase of $909,000 from the prior year.

The increase in earnings is primarily attributable to an increase of $121.9 million of earning assets, which was partially offset by a decrease of 48 basis points in the net interest margin since December 31, 2000. The decrease in net interest margin reflects American Bank’s commitment to maintain some of the best rates in the country on deposit and loan products, even during a period when interest rates fell sharply. In addition, earnings were positively impacted by the Company’s ability to control costs as evidenced by the decline in its operating expense to asset ratio from 1.73% for the quarter ended December 31, 2000 to 1.46% for the same period in 2001.

President and CEO Mark Jaindl stated, “While the quality of our loan portfolio remained high with no non-performing assets at December 31, 2001, American Bank, like other banks throughout the country, has seen some deterioration in the credit quality of its loan portfolio. During the fourth quarter we increased our loan loss reserves by $370,000 as we recognize that the softening economy may result in increased delinquencies. Of the $370,000 increase in reserves during the fourth quarter, $216,000 was the result of a specific reserve relating to one credit.”

Chairman of the Board of Directors Frederick Jaindl stated, “We are pleased with the progress of American Bank during the past year and look forward to continued growth in 2002. In 2001, we remained focused on enhancing shareholder value through the formation of our holding company, American Bank Incorporated. At American Bank, we are committed to both our shareholders and customers and strive to continue our tradition of superior service.”

American Bank common stock last traded at $11.70 per share and the American Bank warrants last traded at $3.00 per warrant. American Bank warrants are exercisable at $10.00 per share through June 30, 2003.

About American Bank

American Bank is a locally-owned community bank based in Allentown, PA. American Bank is recognized as a 5-Star Superior rated financial institution (the highest rating possible) by Bauer Financial Inc., designating it as one of the strongest banks in the nation as well as being named one of the safest banks in the nation by MSN Money. American Bank was ranked #1 by the Morning Call’s Top Workplaces in the Lehigh Valley and has been named one of the Best Places to Work in Pennsylvania.

American Bank offers a complete selection of banking products and services to suit the needs of consumers and businesses and includes checking, money market, savings, certificates of deposit, consumer and commercial loans and Visa credit cards. Dedicated to providing customers superior, personalized customer service, American Bank also offers some of the best loan and deposit rates available and as a result, for the past 12 years, has received the® Top Tier award for consistently offering annual percentage yields (APYs) that were among the highest reported. Their online banking service, AmericanBank Online, which is accessible from the Bank’s website at, allows customers to bank conveniently and delivers a full range of real-time online banking services free of charge including online bill payment and presentment, ACH Direct, transfers between accounts, transaction history, check images and e-Statements. In addition, both consumer and business customers can bank on the go using mobile banking which includes mobile deposit. American Bank is FDIC insured and is an Equal Housing Lender.

AmericanBank Online is a registered trade mark for the Internet financial services provided by American Bank, a state-chartered, FDIC-insured, full-service financial institution serving customers throughout the United States. American Bank is a member of the Federal Reserve System.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

Statements in this press release regarding American Bank's business which are not historical facts, including expectations regarding future financial results, are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from such statements.