American Bank Reports Record Earnings for 2001

CONTACT: Mark W. Jaindl, President and Chief Executive Officer
Allentown, PA, Friday, 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, a locally-owned community bank based in Allentown, PA, 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. American Bank is dedicated to providing customers superior, personalized customer service while offering some of the best loan and deposit rates available and as a result, has received the Bankrate.com® Top Tier award for consistently offering annual percentage yields (APYs) that were among the highest reported. Their online banking service, pcbanker, 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. American Bank is FDIC insured.

American Bank Online and pcbanker.com are registered marks 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.

Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "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. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Bank operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, risks associated with the conduct of the Bank's business over the internet, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.

The Bank wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Bank wishes to advise readers that the factors listed above could affect the Bank's financial performance and could cause the Bank's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Bank does not undertake and specifically declines any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

For additional information, please contact Mark W. Jaindl, President and Chief Executive Officer.