MutualFirst Financial, Inc. Fully Redeems TARP Funding and Participates in SBLF

MUNCIE, Ind., Aug. 26, 2011 /PRNewswire/ — MutualFirst Financial, Inc. (the
“Company”) (NASDAQ: MFSF), the holding company of MutualBank (the “Bank”), today
announced that it has completely repaid funding under the TARP Capital
Repurchase Plan. MutualFirst redeemed the $32.4 million of preferred stock
issued to the Treasury under the TARP Capital Purchase Program (the “TARP”) in
December 2008. In addition to the full redemption of the TARP investment, the
Company paid a total of $4.3 million in dividends to the Treasury during the
period the investment was outstanding. Also, the Treasury continues to hold
warrants to purchase 625,135 shares of common stock of the Company’s common
stock at a price of $7.77 per share. The Company will attempt to repurchase
these warrants from Treasury in the coming weeks, providing an additional return
on the taxpayers’ investment.

“Funding under the TARP program allowed added protection to shareholders and
depositors at a time when there was much uncertainty in financial markets,”
commented David W. Heeter, President and CEO of MutualFirst. Heeter continued.
“In addition, our attempt to retire the warrants will eliminate the dilution
overhang for our shareholders.”

On August 25, 2011, MutualFirst received an investment of $28.9 million in the
company’s preferred stock from the United States Department of the Treasury (the
“Treasury”) under the Small Business Lending Fund (the “SBLF”). The SBLF is a
$30 billion voluntary program intended to encourage small business lending by
providing capital to qualified community banks at favorable rates.

“The Company has been selected among healthy financial institutions to
participate in this important program. We are pleased to have completed the SBLF
capital infusion in support of our small business lending operations and to have
completely repaid the TARP investment,” commented David W. Heeter, President and
CEO. Mr. Heeter added, “We believe our participation in the SBLF program is a
great opportunity for MutualFirst and MutualBank to continue to meet the credit
needs of the small business community.

More details regarding the transactions described above may be found in the
Company’s Current Report on Form 8-K filed on August 26, 2011, with the United
States Securities and Exchange Commission.

MutualBank, an Indiana-based financial institution, has thirty-two full-service
retail financial centers in Delaware, Elkhart, Grant, Kosciusko, Randolph, St.
Joseph and Wabash Counties in Indiana. MutualBank also has two Wealth Management
and Trust offices located in Carmel and Crawfordsville, Indiana and a loan
origination office in New Buffalo, Michigan. MutualBank is a leading residential
lender in each of the market areas it serves, and provides a full range of
financial services including wealth management and trust services and Internet
banking services. The Company’s stock is traded on the NASDAQ National Market
under the symbol “MFSF” and can be found on the Internet at
www.bankwithmutual.com

Statements contained in this release, which are not historical facts, are
forward-looking statements, as that term is defined in the Private Securities
Reform Act of 1995. Such forward-looking statements are subject to risks and
uncertainties, which could cause actual results to differ from those currently
anticipated due to a number of factors, which include, but are not limited to
factors discussed in documents filed by the Company with the Securities and
Exchange Commission from time to time.

SOURCE MutualFirst Financial, Inc.