Popular Inc. to Acquire E-Loan for $300 Million in Cash

PLEASANTON, CA – Popular, Inc., the leading financial institution in Puerto Rico, and E-LOAN, Inc., an online consumer direct lender, today announced the signing of a definitive merger agreement under which Popular, Inc. will acquire 100% of the issued and outstanding shares of common stock and common stock equivalents of E-LOAN, Inc. for $4.25 per share in cash, or approximately $300 million.

This transaction will further expand Popular, Inc.’s penetration into the U.S. market, complement its existing non-prime and warehouse lending businesses, and significantly enhance its technology platform. E-LOAN, Inc., which originated over $5 billion in mortgage, home equity, and auto loans in 2004, stands to benefit from Popular, Inc.’s financial and capital markets strength as well as from cross-promotion and integration opportunities.

“We are impressed with what E-LOAN has built. They are a great brand in this space and we believe we can add financial strength and new products to further enhance it,” said Richard L. Carrion, Chairman of the Board and Chief Executive Officer of Popular, Inc.

According to Bill Williams, President of Popular Financial Holdings Inc., “This is an exciting opportunity for Popular Financial Holdings to strengthen its competitive capabilities.”

“Like E-LOAN, Popular has honored its founding vision and strong values by being passionate about serving customers and committed to treating people with dignity and respect,” said Chris Larsen, Founder and Chairman of E-LOAN, Inc. “These shared values, combined with our complementary strengths and Popular’s long-term focus, will benefit our employees and customers as well as the proliferation of online lending for many years to come.”

E-LOAN, Inc. will maintain its brand identity and become a wholly owned subsidiary of Popular Financial Holdings, Inc. operating in Pleasanton, California. Mark Lefanowicz, Chief Executive Officer and President of E-LOAN, Inc., will continue to serve as President. In addition, E-LOAN, Inc. will retain substantially all its employees. The transaction, which was unanimously approved by the boards of directors of both companies, is subject to E-LOAN, Inc. shareholder approval and is expected to close in the fourth quarter of 2005.

J.P. Morgan Securities Inc. acted as exclusive financial advisor to E- LOAN, Inc. and issued a fairness opinion in conjunction with the transaction. Wachtell, Lipton, Rosen & Katz served as legal counsel to E-LOAN, Inc. and Sullivan & Cromwell LLP served as legal counsel to Popular, Inc.