(PRNewswire) FirstMerit Corporation (Nasdaq: FMER - News) today announced that it has sold its entire $621 million portfolio of manufactured housing loans to Vanderbilt Mortgage and Finance, Inc. ("Vanderbilt"). Vanderbilt has also assumed servicing for certain manufactured housing loans underlying asset-backed securities previously serviced by FirstMerit. The sale closed on December 1, 2003.

John R. Cochran, Chairman and CEO of FirstMerit, commented, "The sale of our manufactured housing portfolio is a strategic opportunity for FirstMerit. It removes a higher risk non-core business, strengthens our balance sheet and allows us to devote additional financial and management resources to super-community banking. The recent enhancements we have made in our core business lines have resulted in a stronger community banking organization, and we are well-positioned to benefit from the eventual economic recovery in our region."

FirstMerit will take an approximate $4.5 million after-tax charge to earnings in the fourth quarter of 2003. The charge reflects the sale of the portfolio, the write-off of assets related to servicing the manufactured housing portfolio, the liquidation of existing foreclosed units and costs associated with discontinued operations. FirstMerit plans to prepay $221 million of fixed-rate Federal Home Loan Bank term borrowings and replace the funding with lower cost borrowings. The refinancing of these borrowings will result in an additional $14.8 million after-tax charge to earnings in the fourth quarter of 2003. On a per share basis, these charges represent a total of $0.23 of per share earnings in 2003. The above transactions will reduce 2004 per share earnings by approximately $0.02.

FirstMerit will host a conference call on December 2, 2003, at 10:00 a.m. EST. Gary J. Elek, EVP, Corporate Development, will provide details of the transaction. To participate in the conference call, please dial 800-865-2821 five minutes before start time. A replay will be available beginning 1:00 p.m., December 2, through 12:00 a.m. Dec. 9, 2003 by dialing 800-642-1687, reservation #4291285.

This release is also available on the Internet at www.firstmerit.com under the Investor Relations portion of the Web site. Any material non-public information will be posted on the Web site immediately after the conference call ends.

FirstMerit Corporation is a diversified financial services company headquartered in Akron, Ohio, with assets of $10.6 billion as of September 30, 2003, and 158 banking offices in 22 Ohio and Western Pennsylvania counties. FirstMerit provides a complete range of banking and other financial services to consumers and businesses through its wholly-owned subsidiaries which include: FirstMerit Bank, N.A., FirstMerit Mortgage Corporation, FirstMerit Title Agency, Ltd., FirstMerit Credit Life Insurance Company, and FirstMerit Community Development Corporation.