Metris Companies Reports Receipt of Wells Notice from SEC

MINNETONKA, MN – Metris Companies Inc. announced today that it has received a “Wells Notice” from the staff of the U.S. Securities and Exchange Commission (SEC or Commission) in connection with the Commission’s investigation concerning the company’s reporting and treatment of “Allowance for loan loss” for 2001, its valuation of “Retained interests in loans securitized” and other matters. That investigation was disclosed by Metris in August 2003.

Under the SEC’s procedures, a Wells Notice indicates that the staff intends to recommend that the Commission bring a civil injunctive action against recipients for possible violations of federal securities laws. The Wells Notice also covers the company’s current chief executive officer and its controller. Recipients of Wells Notices have the opportunity to respond to the SEC staff before the staff makes its formal recommendation on whether any action should be brought by the SEC.

Metris Companies Inc., based in Minnetonka, Minn., is one of the largest bankcard issuers in the United States. The company issues credit cards through Direct Merchants Credit Card Bank, N.A., a wholly owned subsidiary headquartered in Phoenix, Ariz. For more information, visit www.metriscompanies.com or www.directmerchantsbank.com.