IndyMac Bancorp Evaluating Potential Initial Public Offering of Financial Freedom Senior Funding Corporation

IndyMac Bancorp, Inc. (NYSE:NDE) ("Indymac(R)" or the"Company"), the holding company for IndyMac Bank, F.S.B. ("IndymacBank(R)"), today announced that its board of directors has authorizedmanagement to evaluate and plan for the potential sale of a minorityeconomic stake of approximately 20 percent in Indymac Bank's reversemortgage subsidiary, Financial Freedom Senior Funding Corporation("Financial Freedom"), through an initial public offering. FinancialFreedom originated $1.1 billion in reverse mortgages and earned $8.0million in the first quarter of 2006, compared to $507 million inoriginations and $4.2 million in earnings for the first quarter of2005. For the full year 2005, Financial Freedom's national marketshare is estimated to be 56 percent of reverse mortgage originationsand 53 percent of reverse mortgage servicing. As of March 31, 2006,Financial Freedom had 984 employees.
The strategic rationale for the potential offering includes the
following:

1. Public company structure expected to drive growth and
opportunities.
2. Creates vehicle to align Financial Freedom management
incentives directly with performance which, additionally,
enhances ability to attract and retain talent.
3. Provides Indymac the ability to monetize its initial investment
in Financial Freedom while continuing to maintain a controlling
interest.
4. Enhances shareholder value of Indymac as the investing
community could identify more easily the value of the Financial
Freedom franchise.
5. Provides a template to attract entrepreneurs to Indymac.

The potential benefits from an initial public offering toIndymac's shareholders will be offset to a minor extent by managementtime and costs that will be incurred to oversee another publiccompany. The decision to proceed with the offering remains subject tofuture board approval and other factors, including market conditions.

This announcement shall not constitute an offer to sell or thesolicitation of an offer to buy any securities described herein, norshall there be any sale of these securities in any state orjurisdiction in which the offer, solicitation or sale would beunlawful. This announcement is being issued pursuant to and inaccordance with Rule 135 under the Securities Act of 1933.

About Indymac Bank

IndyMac Bancorp, Inc. (NYSE:NDE) (Indymac(R)) is the holdingcompany for IndyMac Bank, F.S.B. (Indymac Bank(R)), the largestsavings and loan in Los Angeles and the 10th largest mortgageoriginator in the nation. Indymac Bank, operating as a hybridthrift/mortgage banker, provides cost-efficient financing for theacquisition, development, and improvement of single-family homes.Indymac also provides financing secured by single-family homes andother banking products to facilitate consumers' personal financialgoals.

With an increased focus on building customer relationships and avaluable consumer franchise, Indymac is committed to becoming a topsix mortgage lender in the U.S. by 2010, while maintaining annualizedearnings per share growth in excess of 15 percent. The company isdedicated to constantly raising expectations and conducting itselfwith the highest level of ethics.

For more information about Indymac and its affiliates, or tosubscribe to the company's Email Alert feature for notification ofcompany news and events, please visithttp://about.indymacbank.com/investors.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release may be deemedto be forward-looking statements within the meaning of the federalsecurities laws. The words "anticipate," "believe," "estimate,""expect," "project," "plan," "forecast," "intend," "goal," "target,"and similar expressions identify forward-looking statements that areinherently subject to risks and uncertainties, many of which cannot bepredicted or quantified. Actual results and the timing of certainevents could differ materially from those projected in or contemplatedby the forward-looking statements due to a number of factors,including, the effect of economic and market conditions includingindustry volumes and margins(1); the level and volatility of interestrates(1); the Company's hedging strategies, hedge effectiveness andasset and liability management(1); the accuracy of subjectiveestimates used in determining the fair value of financial assets ofIndymac; the credit risks with respect to our loans and otherfinancial assets; the actions undertaken by both current and potentialnew competitors(1); the availability of funds from Indymac's lendersand from loan sales and securitizations, to fund mortgage loanoriginations and portfolio investments; the execution of Indymac'sgrowth plans and ability to gain market share in a significant markettransition(1); the impact of disruptions triggered by naturaldisasters, including the assessment of the effects of the Gulf CoastHurricanes(1) and the effects of any future hurricanes; the impact ofcurrent, pending or future legislation, regulations(1) or litigation;and other risk factors described in the reports that Indymac fileswith the Securities and Exchange Commission, including the AnnualReport on Form 10-K, Quarterly Reports on Form 10-Q, and its reportson Form 8-K.

(1) While all of the above items are important, the highlighteditems represent those that, in management's view, merit increasedfocus given current conditions.