MutualFirst battled throughout 2009 to combat deepening economic challenges across our markets and the entire economy. Continued increasing unemployment, sluggish economic indicators, and increasing uncertainty in Washington regarding regulation has created a very difficult operating environment for a financial institution. Today's economic climate continues to present many challenges for MutualBank, particularly increased credit costs.

Despite these significant challenges, we had success in 2009. During the year, MutualBank continued the successful integration of our merger with MFB by expanding MutualWealth Management Group and Retirement Plan Services across our entire footprint. We processed a near record number real estate loans; grew deposits organically by 8½ percent, or $82 million; paid a special FDIC deposit insurance premium as well as prepaid future FDIC premiums; and yet delivered a profit of $.20 per share for the year 2009. Although very modest, net income for 2009 is a significant accomplishment for our institution given the challenges we faced. Many other financial institutions did not fare as well.

As we subscribe to the theory that you can't change the past, we look forward with optimism. We have looked for, and found ways to make our Company better for the future. We are a well-capitalized, strong financial institution with a stable of talented and dedicated professionals that work every day to enhance shareholder value.

2009 continued to create toughness in our Company. In weathering this storm, we are prepared to effectively manage through others. As we continue to keep our eyes on the horizon, although we see no immediate relief, we do see signs of a long slow recovery. We are thankful for the trust of our customers and shareholders and appreciate the support of both.

Thank you for your continued belief and confidence in MutualFirst Financial, Inc.

Sincerely,

David W. Heeter

President and CEO