July 1, 1999
                                                           FOR IMMEDIATE RELEASE
                                          Contact:  Phyllis A. Murphy, President
                                                     and Chief Executive Officer
                                                              Tel (515) 832-3071

                    WEBSTER CITY FEDERAL COMPLETES FORMATION
                               OF HOLDING COMPANY


         Webster City,  Iowa - Webster City Federal Savings Bank announced today
that it had  completed  the  formation of Webster  City  Federal  Bancorp as its
holding  company.  The  formation  of the holding  company  was  approved by the
stockholders of the Bank on April 21, 1999.

         Phyllis A. Murphy,  President and Chief Executive  Officer of the Bank,
stated "We are pleased to have  completed  the formation of Webster City Federal
Bancorp.  The formation of this Company will allow us to consider repurchases of
common stock if market and  financial  conditions  so warrant.  We consider this
additional flexibility important as a tool to increase shareholder value."

         Existing  shareholders of the Bank automatically become shareholders of
the Company.  The Company's common stock will be traded on the NASDAQ "SmallCap"
market  under the symbol  "WCFBD" for 20 trading  days before  reverting  to the
permanent symbol "WCFB."

         Webster City Federal Savings Bank is a federally-chartered savings bank
operating  out of Webster City,  Iowa.  At March 31, 1999,  the Bank had $92.9
million of total assets.