SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. ___)

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as Permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material under Rule 14a-12

BANK MUTUAL CORPORATION

(Name of Registrant as Specified In Its Charter)

n/a

(Name of Person(s) Filing Proxy Statement,
if Other than Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:

March 27, 2001

Dear Fellow Shareholder,

We invite you to attend the Bank Mutual Corporation 2001 Annual Meeting
of Shareholders, which will be held at the Four Points Sheraton Milwaukee North
Hotel, 8900 N. Kildeer Court, Milwaukee, Wisconsin at 10:00 a.m., Central Time,
on Tuesday, May 8, 2001.

Bank Mutual's Notice of Annual Meeting of Shareholders and Proxy
Statement which are enclosed describe the business to be conducted at the Annual
Meeting. If you plan to attend the Annual Meeting, please check the box on the
proxy form so that we can make the appropriate arrangements.

Also enclosed is a copy of Bank Mutual's Summary Annual Report and the
Annual Report on Form 10-K for the year ended December 31, 2000.

YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend the
Annual Meeting, we urge you to MARK, SIGN, DATE AND RETURN YOUR PROXY FORM IN
THE ENCLOSED POSTAGE-PAID ENVELOPE AS SOON AS POSSIBLE to make sure that you are
represented. This will not prevent you from voting in person at the Annual
Meeting, but will ensure that your shares will be represented if you are unable
to attend.

Sincerely,

BANK MUTUAL CORPORATION

/s/ Michael T. Crowley, Jr.

MICHAEL T. CROWLEY, JR.
Chairman and Chief Executive Officer

BANK MUTUAL CORPORATION

4949 WEST BROWN DEER ROAD
MILWAUKEE WISCONSIN 53223
(414) 354-1500

------------------------------

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 8, 2001

-----------------------------

To the Shareholders of Bank Mutual Corporation:

The 2001 annual meeting of shareholders of Bank Mutual Corporation will
be held on Tuesday, May 8, 2001, at 10:00 a.m., Central Time, at the Four Points
Sheraton Milwaukee North Hotel, 8900 N. Kildeer Court, Milwaukee, Wisconsin for
the following purposes:

(1) To elect directors as follows:
o Three directors to serve for terms expiring in 2004;
o One director to serve for the balance of a term expiring in 2003; and
o Three directors to serve for the balance of terms expiring in 2002.
(2) To consider and approve the Bank Mutual Corporation 2001 Stock Incentive
Plan;
(3) To ratify the selection of Ernst & Young LLP as Bank Mutual's
independent auditors for 2001; and
(4) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.

The board of directors has fixed the close of business on March 15,
2001 as the record date for the determination of shareholders entitled to notice
of and to vote at the annual meeting and any adjournment thereof. Only
shareholders of record at the close of business on that date will be entitled to
vote at the annual meeting.

We call your attention to the proxy statement accompanying this notice
for a more complete statement regarding the matters to be acted upon at the
annual meeting. Please read it carefully.

By Order of the Board of Directors

/s/ Eugene H. Maurer, Jr.

Eugene H. Maurer, Jr.
Senior Vice President and Secretary
Milwaukee, Wisconsin
March 27, 2001
YOUR VOTE IS IMPORTANT

YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE INDICATE YOUR
VOTING DIRECTIONS, SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY, WHICH
IS SOLICITED BY THE BANK MUTUAL BOARD OF DIRECTORS, USING THE ENCLOSED
SELF-ADDRESSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES. IF FOR ANY REASON YOU SHOULD DESIRE TO REVOKE YOUR PROXY, YOU MAY DO SO
AT ANY TIME BEFORE IT IS VOTED AT THE ANNUAL MEETING.

PROXY STATEMENT

BANK MUTUAL CORPORATION
4949 WEST BROWN DEER ROAD
MILWAUKEE, WISCONSIN 53223
(414) 354-1500
----------------------

SOLICITATION AND VOTING

This proxy statement and accompanying proxy are furnished to the
shareholders of Bank Mutual Corporation ("Bank Mutual") in connection with the
solicitation of proxies by Bank Mutual's board of directors for use at the
annual meeting of Bank Mutual shareholders on Tuesday, May 8, 2001, and at any
adjournment of that meeting. The 2000 summary annual report to shareholders,
which accompanies this proxy statement, and the annual report on Form 10-K,
attached hereto, contain financial statements and certain other information
concerning Bank Mutual. We are mailing the proxy materials to shareholders
beginning on or about March 27, 2001.

Bank Mutual was formed in a restructuring on November 1, 2000 of Mutual
Savings Bank into mutual holding company form. In that restructuring, Bank
Mutual became the holding company of Mutual Savings Bank, and Mutual Savings
Bank's depositors were given the opportunity to purchase shares of Bank Mutual
stock. Information in this proxy statement includes information relating to
Mutual Savings Bank prior to the restructuring. On the same day, Bank Mutual
acquired First Northern Capital Corp., whose First Northern Savings Bank
subsidiary became a wholly owned subsidiary of Bank Mutual. Certain executive
officers and directors of First Northern became Bank Mutual executive officers
and directors as a result of this transaction. Information regarding First
Northern prior to its acquisition by Bank Mutual is not included in this proxy
statement unless otherwise stated.

The board of directors has fixed the close of business on March 15,
2001 as the record date for the determination of shareholders entitled to notice
of and to vote at the annual meeting and any adjournment thereof. Only holders
of record of Bank Mutual common stock, the only class of voting stock of Bank
Mutual outstanding, on the record date are entitled to notice of and to vote at
the annual meeting. Each share of common stock is entitled to one vote. At the
record date, there were 22,341,665 shares of common stock validly issued and
outstanding.

Any shareholder entitled to vote at the annual meeting may vote either
in person or by a properly executed proxy. Shares represented by properly
executed proxies received by Bank Mutual will be voted at the annual meeting, or
any adjournment thereof, in accordance with the terms of such proxies, unless
revoked. If no voting instructions are given on a properly executed proxy, the
shares will be voted FOR the election of management's director nominees, FOR
approval of the Bank Mutual Corporation 2001 Stock Incentive Plan (the "2001
Plan"), and FOR ratification of the selection of auditors.

If a shareholder participates in the Bank Mutual Dividend Reinvestment
and Stock Purchase Plan (the "DRIP"), the proxy also will serve as voting
instructions for the participant's shares held in the DRIP. Participants' shares
will be voted by the administrator of the DRIP in accordance with those voting
instructions. If a participant does not return a proxy, the DRIP administrator
will not vote that participant's shares held in the DRIP.

Any shareholder who owns Bank Mutual shares through an investment in
the Bank Mutual Common Stock Fund of the Mutual Savings Bank Savings and
Investment Plan or the Employer Stock Fund of First Northern Savings Bank 401(k)
Plan (the "Savings Plans") will receive a separate blue proxy card to instruct
the administrator of the Savings Plan how to vote those shares. The
administrators of the Savings Plans will vote those shares in accordance with
the voting instructions on the blue proxies. If a participant in either Savings
Plan does not return a proxy, the administrators will vote such participant's
shares held in a Savings Plan in the same proportion that all shares in that
Savings Plan for which voting instructions have been received are voted.

A shareholder may revoke a proxy at any time prior to the time when it
is voted by filing a written notice of revocation with the corporate secretary
of Bank Mutual, by delivering a properly executed proxy bearing a later date

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or by voting in person at the annual meeting. Attendance at the annual meeting
will not in itself constitute revocation of a proxy.

A majority of the votes entitled to be cast by the shares entitled to
vote, represented in person or by proxy, will constitute a quorum of
shareholders at the annual meeting. Shares for which authority is withheld to
vote for director nominees and broker non-votes (i.e., proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owners or other persons entitled to vote shares as to a matter with
respect to which the brokers or nominees do not have discretionary power to
vote) will be considered present for purposes of establishing a quorum. The
inspectors of election appointed by the board of directors will count the votes
and ballots at the annual meeting.

A plurality of the votes cast at the annual meeting by the holders of
shares of common stock entitled to vote is required for the election of
directors. In other words, the individuals who receive the largest number of
votes are elected as directors up to the maximum number of directors in a class
to be chosen at the annual meeting. Votes for the nominees in each class will be
tallied separately. With respect to the election of directors, any shares not
voted, whether by withheld authority, broker non-vote or otherwise, will have no
effect on the election of directors except to the extent that the failure to
vote for an individual results in another individual receiving a comparatively
larger number of votes. Mutual Savings Bancorp, MHC (the "MHC"), Bank Mutual's
mutual holding company, owns a majority of Bank Mutual's shares. The MHC expects
to vote in favor of the management nominees for director.

Under Bank Mutual's bylaws, assuming a quorum is present, the
affirmative vote of a majority of the shares represented at the meeting and
entitled to vote on the subject matter is generally required for approval of an
item other than the election of directors. OTS conversion regulations also
require shareholder approval of the 2001 Plan by a majority of the votes
eligible to be cast other than the shares held by the MHC. Therefore, the 2001
Plan will be approved if it receives the vote of the holders of both:

o a majority of the shares represented at the annual meeting; and

o a majority of shares held by shareholders other than the MHC.

Ratification of the selection of independent accountants requires only the
affirmative vote of the holders of a majority of the shares represented at the
annual meeting and entitled to vote on the matter, and the MHC intends to vote
for ratification.

Expenses in connection with the solicitation of proxies will be paid by
Bank Mutual. Proxies will be solicited principally by mail, but may also be
solicited by the directors, officers and other employees of Bank Mutual in
person or by telephone, facsimile or other means of communication. Those
directors, officers and employees will receive no compensation therefor in
addition to their regular compensation, but may be reimbursed for their related
out-of-pocket expenses. Brokers, dealers, banks, or their nominees, who hold
common stock on behalf of another will be asked to send proxy material and
related documents to the beneficial owners of such stock, and Bank Mutual will
reimburse those persons for their reasonable expenses.

The board of directors of Bank Mutual knows of no matters to be acted
upon at the annual meeting other than as set forth in the notice attached to
this proxy statement. If any other matters properly come before the annual
meeting, or any adjournment thereof, it is the intention of the persons named in
the proxy to vote such proxies in accordance with their best judgment on such
matters.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The table below sets forth information regarding the beneficial
ownership of Bank Mutual common stock on the record date by each person known by
Bank Mutual to beneficially own more than 5% of the outstanding shares of its
common stock, by each director and nominee for director, by each executive
officer named in the Summary Compensation Table below and by all directors and
executive officers of Bank Mutual as a group.

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Number of Shares and
Name of Nature of Beneficial Percent
Beneficial Owner Ownership (1) of Class
- ------------------ --------------------- ---------

Mutual Savings Bancorp, MHC (2)......... 11,193,174 50.1%

Thomas H. Buestrin...................... 17,516 *
Rick B. Colberg......................... 15,524 *
Michael T. Crowley, Jr.................. 150,570 *
Michael T. Crowley, Sr.................. 11,000 *
Raymond W. Dwyer, Jr.................... 2,012 *
Mark C. Herr............................ 300 *
Thomas J. Lopina, Sr.................... 47,245 *
Eugene H. Maurer, Jr.................... 10,000 *
Michael D. Meeuwsen..................... 108,084 *
William J. Mielke....................... 50,000 *
Robert B. Olson......................... 104,515 *
David J. Rolfs.......................... 16,500 *
Marlene M. Scholz....................... 8,000 *
J. Gus Swoboda.......................... 30,821 *

All directors and executive officers
as a group (14 persons) (2)(3)(4)... 1,463,966 6.6%

- ------------------
* Less than 1.0%

(1) Unless otherwise noted, the specified persons have sole voting and
dispositive power as to the shares. Beneficial ownership of the following
shares is shared: Mr. Buestrin - 12,516 shares; Mr. Colberg - 15,524; Mr.
Crowley, Jr. - 20,129; Mr. Lopina - 10,963; Mr. Meeuwsen - 48,193; Mr.
Rolfs - 11,500; Mr. Swoboda - 30,821; group - 1,042,435. See also notes
(2), (3) and (4) below.
(2) The Bank Mutual board also constitutes the MHC board of directors. While
the MHC board members may therefore be deemed as a group to control the
vote of shares held by the MHC, those shares are not included in
directors' ownership either individually or as a group. The address of the
MHC is 4949 West Brown Deer Road, Milwaukee, Wisconsin 53223.
(3) The total for the group (but not the individual totals) includes 891,879
shares held in the Bank Mutual Employee Stock Ownership Plan ("ESOP"), as
to which voting and dispositive power is shared. As acting administrator,
Bank Mutual (through its board) may vote these shares in its discretion
since none of those shares have yet been allocated to participants. Once
shares are allocated to individual employee accounts, the employees will
be able to vote the shares held in their accounts, and the administrator
will vote unallocated and unvoted shares in the same proportion as
allocated employee shares are voted.
(4) Because the Savings Plans permit participants to vote those shares and
make investment decisions (except in the case of certain takeover offers),
shares held in the Savings Plans are included only if held in the accounts
of persons in the table, even though certain of the executive officers are
trustees or administrators of one of the Savings Plans.

The above beneficial ownership information is based on data furnished
by the specified persons and is determined in accordance with Rule 13d-3 under
the Securities Exchange Act, as required for purposes of this proxy statement.
It is not necessarily to be construed as an admission of beneficial ownership
for other purposes.

ELECTION OF DIRECTORS

The bylaws provide that the number of directors of Bank Mutual shall be
eleven. At each annual meeting the term of office of one class of directors
expires and a class of directors is elected to serve for a term of three years
or until their successors are elected and qualified. In the First Northern
merger agreement, Mutual Savings Bank committed that four of the six directors
of First Northern would initially be elected to the Bank Mutual board of

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directors. Mutual Savings Bank designated Messrs. Lopina, Meeuwsen, Olson and
Swoboda as those directors, and they were elected by board action effective
shortly after the merger.

Herbert W. Isermann, a director of Mutual Savings Bank since 1982 and
one of the initial directors of Bank Mutual, passed away in January 2001. Bank
Mutual acknowledges Mr. Isermann's many years of service to Mutual Savings Bank
and expresses its condolences to his family. Mr. Isermann's seat on the Bank
Mutual board of directors was subject to re-election at the 2002 annual meeting.
The board of directors has chosen Mr. Herr to fill Mr. Isermann's seat for a
term expiring at the 2002 annual meeting.

Messrs. Crowley, Sr., Dwyer and Swoboda, the directors whose present
terms expire at the Annual Meeting, are being nominated for re-election as
directors for terms expiring in 2004. Although they are directors in classes
whose terms expire in either 2002 or 2003, Messrs. Herr, Lopina, Meeuwsen and
Olson are subject to re-election at the upcoming annual meeting because they
were elected as directors by the board after the restructuring. Bank Mutual's
bylaws require that any director who has been elected by the board to fill a
vacancy between shareholder meetings is subject to re-election at the next
annual meeting, even if the term extends beyond that meeting. Shares represented
by proxies received from shareholders will be voted for the election of the
nominees unless otherwise specified by the executing shareholders.

Information regarding the nominees and the directors whose terms
continue is set forth in the following table. If any of the nominees should
decline or be unable to act as a director, which we do not foresee, proxies may
be voted with discretionary authority for a substitute nominee or nominees
designated by the board of directors.

The board of directors unanimously recommends that shareholders vote
FOR the election of the director nominees listed below.

PRINCIPAL OCCUPATION AND DIRECTOR
NAME AND AGE BUSINESS EXPERIENCE (1) SINCE (2)
------------ ----------------------- ---------

NOMINEES FOR TERMS EXPIRING IN 2004

Michael T. Crowley, Sr., Chairman of the Board of Mutual Savings Bank and, 1960
87 (3) since 2000, the MHC

Raymond W. Dwyer, Jr., Retired; prior to his retirement, a practicing 1957
77 (4) architect with R.W. Dwyer Architects

J. Gus Swoboda, Retired; prior to 1997, Senior Vice President, Human 1987
66 (5) and Corporate Development, Wisconsin Public Service
Corporation, an electric and gas utility

NOMINEE FOR TERM EXPIRING IN 2003

Michael D. Meeuwsen, President and Chief Operating Officer of Bank Mutual 1988
47 since 2000; President and CEO of First Northern
Savings Bank

NOMINEES FOR TERMS EXPIRING IN 2002

Mark C. Herr, Vice President-Corporate Division, Plunkett Raysich 2001
48 Architects (6)

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PRINCIPAL OCCUPATION AND DIRECTOR
NAME AND AGE BUSINESS EXPERIENCE (1) SINCE (2)
------------ ----------------------- ---------

Thomas J. Lopina, Sr. Associate, Spectrum Solutions, Inc., a small business 1979
63 (4) consulting firm, since 1997; previously, President and
CEO of Ingersoll Equipment Co., Inc., a manufacturer
of outdoor power equipment

Robert B. Olson, Retired; prior to December 2000, Vice President of 1997
63 (7) Manufacturing Operations, Little Rapids Corporation, a
specialty paper producer

CONTINUING DIRECTOR - TERM EXPIRING IN 2002

David J. Rolfs, Retired; prior to retirement, employed as president of 1984
79 (4) (7) ABCO Dealers Inc., health care industry

CONTINUING DIRECTORS--TERMS EXPIRING IN 2003

Thomas H. Buestrin, Real estate investor, property manager and real estate 1995
64 (7) developer with the firm of Buestrin, Allen &
Associates Ltd., of which he is president

Michael T. Crowley, Jr., Chairman and CEO of Bank Mutual since 2000; President 1970
58 (3) (8) and CEO of Mutual Savings Bank

William J. Mielke, Civil engineer with the firm Ruekert & Mielke Inc., of 1988
53 (4) (7) which he is president and CEO

- -----------------

(1) Unless otherwise noted, all directors have been employed in their
respective principal occupations listed for at least the past five years.
(2) Indicates date when director was first elected to the board of Mutual
Savings Bank, First Northern Savings Bank or First Northern Capital Corp.,
as the case may be. Each of these persons, other than Mr. Herr, became a
director of Bank Mutual in 2000.
(3) Mr. Crowley, Sr. is the father of Mr. Crowley, Jr.
(4) Member of the Compensation Committee, of which Mr. Rolfs is Chairman. The
predecessor Finance Committee of Mutual Savings Bank held one meeting in
2000. The Compensation Committee reviews, and either establishes or
recommends to the board: compensation policies and plans; salaries,
bonuses and benefits for all employees, including determinations with
respect to stock options; and personnel policies and procedures. See
"Compensation Committee Report on Executive Compensation" below.
(5) Mr. Swoboda is also a director of American Medical Security Group, Inc., a
health and life insurance company.
(6) From time to time, Plunkett Raysich Architects and affiliates provide
services to Bank Mutual and subsidiaries. Services during 2000 were below
the level requiring specific disclosure.
(7) Member of the Audit Committee, of which Mr. Mielke is Chairman. The
predecessor Audit Committee of Mutual Savings Bank was first established
in 2000 but did not meet. The Audit Committee's functions include meeting
with Bank Mutual's independent auditors and making recommendations to the
board regarding independent public accountants, adequacy of internal
controls, accounting methods and procedures, public disclosures required
for compliance with securities laws and other matters relating to Bank
Mutual's financial accounting and reporting. See "Report of the Audit
Committee" below.
(8) Also non-employee chairman and director of TYME Corporation, an ATM
network operator of which Mutual Savings Bank and First Northern Savings
Bank are members.

The Bank Mutual bylaws provide that the board of directors as a whole
will act as a Nominating Committee. As such, the board will consider appropriate
nominees for any vacancy on the Bank Mutual board of directors, and shareholders
should forward any nominations to the board.

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9

Because Bank Mutual was not formally incorporated until November 1,
2000, the Bank Mutual board of directors held only one meeting in 2000 and acted
once by unanimous consent. In addition, the board of directors of Mutual Savings
Bank, its predecessor, met 14 times prior to Bank Mutual's formation. During the
period in the last fiscal year in which they served, all members of the board of
directors attended at least 75% of the aggregate of the total number of meetings
of the Bank Mutual or Mutual Savings Bank board and the total number of meetings
held by all committees of the board on which they served.

DIRECTORS' COMPENSATION

MEETING FEES

BANK MUTUAL. There is no annual retainer for membership on the Bank Mutual
board of directors. Each member of the board receives a fee of $1,000 per board
meeting attended. In addition, each non-officer director receives a $500 fee for
each committee meeting attended. Each of the directors of Bank Mutual also
serves as a director of Mutual Savings Bank and/or First Northern Savings Bank.
Compensation for service on those boards is described below. Each Bank Mutual
director also serves as a director of the MHC, although there is no separate or
additional compensation for such service.

MUTUAL SAVINGS BANK. Mutual Savings Bank pays a $10,000 annual retainer
fee to each of its non-management directors. Each of the directors receives a
$1,000 fee for attendance at each board meeting, and each non-officer receives a
fee for attendance at a committee meeting, as follows: executive committee-$700;
advertising committee and compensation (f/k/a finance) committee-$150. No fee is
paid for audit committee meetings. Under an arrangement pre-dating the
establishment of the current payment structure, Mr. Dwyer received a fee for
directors' and executive committee meetings for each month regardless of
attendance. Messrs. Buestrin, Crowley, Jr., Crowley, Sr., Dwyer, Herr, Meeuwsen,
Mielke and Rolfs are currently directors of Mutual Savings Bank, although Mr.
Meeuwsen does not receive any compensation as a Mutual Savings Bank board
member.

FIRST NORTHERN SAVINGS BANK. First Northern Savings Bank does not pay a
retainer fee. Each board member receives a $1,250 fee for attendance at each
board meeting, other than the chairman (currently Mr. Swoboda) who receives
$1,500. In addition, each non-officer director receives fees of $125 per hour
for attendance at any committee meeting. Messrs. Crowley, Jr., Lopina, Meeuwsen,
Olson and Swoboda are directors of First Northern Savings Bank, although Mr.
Crowley, Jr. does not receive compensation as a First Northern Savings Bank
board member.

STOCK INCENTIVE PLAN

Bank Mutual directors will be eligible to participate in the 2001 Plan,
if it is approved by Bank Mutual shareholders. Pursuant to the 2001 Plan and OTS
regulations, no individual may receive more than 25% of the shares which can be
issued under the 2001 Plan, and non-employee directors as a group will be
limited to not more than 30% of the shares which can be issued under the 2001
Plan, and individually to not more than 5%. For further information about the
2001 Plan, see "Approval of 2001 Plan" later in this proxy statement.

DEFERRED RETIREMENT PLAN FOR DIRECTORS

Both Mutual Savings Bank and First Northern Savings Bank maintain
deferred retirement plans for directors. Both the deferred retirement plans
below include provisions whereby the directors may forfeit their benefits for
matters specified in each of the plans which are adverse to the banks. Both
plans may be amended by the appropriate board of directors, although a plan
amendment may generally not impair the rights of persons who are receiving
benefits under the plans.

MUTUAL SAVINGS BANK. Mutual Savings Bank non-officer directors who have
provided at least five years of service will be paid $833 per month for 10 years
(or, if less, the number of years of service on the board) after their
retirement from the Mutual Savings Bank board or age 65, whichever is later. All
of the existing eligible directors' benefits (other than Mr. Herr's) have
vested. In the event a director dies prior to completion of these payments,

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payments will go to the director's heirs. Mutual Savings Bank has funded these
arrangements through "rabbi trust" arrangements, and based on actuarial analyses
believes these obligations are adequately funded.

FIRST NORTHERN. Eligible directors under the First Northern Savings Bank
Directors' Deferred Retirement Plan include persons serving as members of the
First Northern Savings Bank board and any director of an advisory board
established by the bank if the person was a director of a predecessor
institution and is designated by the board to participate. Eligible directors
who either terminate board service for any reason after both attaining age 62
and completing at least nine full years of service on the First Northern Savings
Bank board or any predecessor board, or who terminate service before attaining
age 62, but whose age plus full years of service equals or exceeds 70, will be
entitled to a monthly retirement benefit of $1,000 for 180 months or until the
director's death if earlier. If the eligible director dies after benefits have
commenced, but prior to the receipt of 36 monthly payments, the benefit will
continue to the director's beneficiary for the duration of the 36-month period.
Benefits are payable for a maximum of 15 years. This plan is funded through
insurance.

OTHER

See "Executive Compensation" for compensation paid to, and agreements
with, Messrs. Crowley, Sr., Mr. Crowley, Jr. and Meeuwsen as executive officers
of Bank Mutual, Mutual Savings Bank and/or First Northern Savings Bank.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Under the federal securities laws, Bank Mutual's directors, its executive
officers and any person holding more than 10% of the common stock are required
to report their initial ownership of the common stock and any subsequent change
in that ownership to the SEC. Specific due dates for these reports have been
established and Bank Mutual is required to disclose in this Proxy Statement any
failure to file such reports by these dates during the last year. We believe all
of these filing requirements were satisfied during the year ended December 31,
2000. In making these disclosures, Bank Mutual has relied solely on written
representations of its directors and executive officers and copies of the
reports that they have filed with the SEC.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth information concerning the total
compensation of the chief executive officer, the other four most highly
compensated Bank Mutual executive officers, and Mr. Crowley, Sr. for services in
all capacities to Bank Mutual for the last three fiscal years. The information
includes service to, and payments by, Bank Mutual and its subsidiaries.

Messrs. Meeuwsen and Colberg were executive officers of First Northern
prior to its acquisition by Bank Mutual, and became executive officers of Bank
Mutual upon the acquisition as well as continuing as officers of First Northern
Savings Bank. Bank Mutual agreed in the acquisition to continue Mr. Meeuwsen's
employment agreement and replace Mr. Colberg's employment agreement with one
with substantially similar economic terms. Therefore, Bank Mutual is reporting
their compensation for fiscal 2000 as including cash compensation from First
Northern during periods in 2000 prior to the acquisition. Information for prior
years is not presented for Messrs. Meeuwsen and Colberg, as neither Bank Mutual
nor Mutual Savings Bank had any involvement with determining that compensation.
In addition, information is presented for Mr. Crowley, Sr., who is an executive
officer of Mutual Savings Bank and the MHC but not of Bank Mutual, as a
consequence of his service on the Bank Mutual board and the MHC's ownership
position in Bank Mutual.

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LONG-TERM
COMPENSATION
AWARDS ALL
ANNUAL COMPENSATION (1) SECURITIES OTHER
---------------------------- UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITIONS YEAR SALARY($)(2) BONUS($)(3) OPTIONS (#)(4) ($)(5)
---------------------------- ---- ------------ ----------- -------------- ------------

Michael T. Crowley, Jr. 2000 $609,060 (6) -- $ 1,700
Chairman and Chief Executive 1999 $573,556 -- -- $ 1,600
Officer of Bank Mutual; President 1998 $573,556 $16,485 -- $ 1,600
and CEO of Mutual Savings Bank

Michael T. Crowley, Sr. 2000 $254,052 (6) -- $ 1,020
Chairman of Mutual Savings Bank 1999 $238,052 -- -- $ 1,280
and the MHC (7) 1998 $238,052 $ 6,780 -- $ 1,447

Michael D. Meeuwsen 2000 $199,500 $46,000 --(4) $12,750(8)
President and Chief Operating
Officer of Bank Mutual; President
and CEO of First Northern Savings
Bank

Eugene H. Maurer, Jr. 2000 $145,040 $ 5,000 (6) -- $ 1,500
Senior Vice President and 1999 $139,465 -- -- $ 1,435
Secretary of Bank Mutual; Senior 1998 $133,965 $ 4,018 -- $ 1,382
VP and Secretary/Treasurer of
Mutual Savings Bank

Rick B. Colberg 2000 $89,500 $ 18,500 --(4) $12,750(8)
Chief Financial Officer of Bank
Mutual; Senior VP and Treasurer of
First Northern Savings Bank

Marlene M. Scholz 2000 $100,065 $ 5,000 (6) -- $ 1,051
Senior Vice President of Bank 1999 $ 84,065 -- -- $ 865
Mutual; Senior VP-Controller of 1998 $ 80,265 $ 2,407 -- $ 834
Mutual Savings Bank

- -----------------
(1) While each of the named individuals received perquisites or other personal
benefits in the years shown, the value of these benefits is not indicated,
in accordance with Securities and Exchange Commission ("SEC") regulations,
since they did not together exceed the lesser of $50,000 or 10% of the
individual's salary and bonus in any year.
(2) Includes any directors' fees paid to the individual while serving as an
executive officer.
(3) Annual bonus amounts are earned and accrued during the years indicated and
paid at the beginning of the next calendar year.
(4) Messrs. Meeuwsen and Colberg received non-qualified stock option grants
from First Northern prior to its acquisition by Bank Mutual. These options
were "cashed out" as part of Bank Mutual's acquisition of First Northern.
See Note (8). No options or stock appreciation rights have ever been
awarded by Bank Mutual or Mutual Savings Bank.
(5) The following dollar amounts reflect Bank Mutual's or its subsidiaries'
contributions to the Savings Plans on behalf of the named individuals: Mr.
Crowley, Jr., $1,700; Mr. Crowley, Sr., $1,020; Mr. Meeuwsen, $12,750; Mr.
Maurer, $1,500; Mr. Colberg, $12,750; and Ms. Scholz, $1,051.
(6) Under the Mutual Savings Bank incentive program as in effect in 2000,
bonus amounts are not determined until peer group information is
available. Because that information is not yet available, 2000 bonus
information has not yet been determined. The maximum bonus which could be
paid would be 8% of base salary. Mr. Maurer and Ms. Scholz received the
additional discretionary bonuses in the table as a result of extraordinary
duties in 2000 due to the Mutual Savings Bank restructuring; they remain
eligible for plan bonuses.
(7) Mr. Crowley, Sr. is an executive officer of Mutual Savings Bank and the
MHC, but not of Bank Mutual.

-8-
12

(8) First Northern stock options held by Messrs. Meeuwsen and Colberg were
"cashed out" as part of Bank Mutual's acquisition of First Northern. In
that transaction, each First Northern option holder received from First
Northern an amount equal to the sum of the cash difference between the
option stock price and the $15.00 per share cash price offered to First
Northern shareholders. Bank Mutual agreed to an additional payment of 25%
of the cash difference in recognition of the tax effect resulting from the
required conversion into cash. These additional 25% payments, which are
not included in the table, were $275,286 for Mr. Meeuwsen, and $129,710
for Mr. Colberg. Bank Mutual did not award the underlying options or
determine the value of the option spread; therefore, those amounts are not
included here. The options to which these payments related were granted by
First Northern over the course of ten years.

STOCK OPTIONS

Bank Mutual did not have a stock option plan in effect in 2000, and thus
did not grant any stock options. The stock option grants appearing in the table
above represent stock option grants by First Northern prior to its agreement to
be acquired by Bank Mutual and which were cashed out as discussed above. In
addition, Bank Mutual had no outstanding stock options at fiscal year end.
Therefore, no stock option tabular information is included in this proxy
statement. See "Approval of 2001 Plan" regarding the proposed Bank Mutual 2001
Stock Incentive Plan.

DEFINED BENEFIT RETIREMENT PLANS

Mutual Savings Bank maintains a qualified defined benefit pension plan
that covers substantially all employees who are age 21 or over and who have at
least one year of service. Pension benefits are based on the participant's
average annual compensation (salary and bonus) and years of credited service.
Years of credited service in the qualified defined benefit pension plan begin at
date of participation in the plan. Benefits are determined in the form of a ten
year certain and life annuity.

Designated officers of Mutual Savings Bank also participate in a
non-qualified defined benefit pension plan. This non-qualified plan provides
monthly supplemental benefits to participants which will be paid out of the
rabbi trust established for this plan, or unsecured corporate assets. The amount
of the non-qualified plan benefit in the form of a ten year certain and life
annuity is determined as:

o an amount calculated under Mutual Savings Bank's qualified defined
benefit pension plan without regard to the limitations imposed by the
Internal Revenue Code on benefit or compensation amounts and without
regard to certain limitations on years of service; minus

o the pension benefit accrued in the qualified defined benefit pension
plan.

The following table shows the estimated annual benefits payable in ten
year certain and life annuity form for participants retiring on their normal
retirement date at age 65 with various combinations of years of service and
average annual compensation under the qualified defined benefit plan plus, for
those officers eligible to participate, the non-qualified plan. At March 31,
2001, accrued years of service for officers named in the summary compensation
table were: Mr. Crowley, Sr. - 67 years; Mr. Crowley, Jr. - 33 years, Mr. Maurer
- - 18 years, and Ms. Scholz - 19 years. Messrs. Meeuwsen and Colberg are not
eligible to participate in the Mutual Savings Bank Defined Benefit Retirement
Plan as they are not Mutual Savings Bank employees.

-9-

Final Average
Compensation Years of Service(1)
------------ ----------------------------------------------------------------------
15 20 25 30 35 40
-------- --------- -------- -------- -------- ---------

$ 100,000 $ 28,300 $ 37,700 $ 49,700 $ 61,600 $ 73,500 $ 83,600
150,000 44,000 58,600 77,000 95,400 113,800 128,900
200,000 59,600 79,500 104,400 129,300 154,200 174,300
250,000 75,300 100,400 131,800 163,100 194,500 219,600
300,000 91,000 121,300 159,200 197,000 234,800 265,000
350,000 106,700 142,200 186,500 230,800 275,100 310,300
400,000 122,300 163,100 213,900 264,700 315,500 355,700
450,000 138,000 184,000 241,300 298,500 355,800 401,000
500,000 153,700 204,900 268,700 332,400 396,100 446,400
550,000 169,400 225,800 296,000 366,200 436,400 491,700
600,000 185,000 246,700 323,400 400,100 476,800 537,100
650,000 200,700 267,600 350,800 433,900 517,100 582,400
700,000 216,400 288,500 378,200 467,800 557,400 627,800
750,000 232,100 309,400 405,500 501,600 597,700 673,100

- -----------------------------

(1) Years of service in the non-qualified defined benefit pension plan begin
at date of hire. As of December 31, 2000, Mr. Crowley, Sr. has more than
67 years of service with Mutual Savings Bank. The amount of his total
annual accrued benefit as of December 31, 2000 was approximately $324,433.

EMPLOYMENT AND RETIREMENT ARRANGEMENTS

MUTUAL SAVINGS BANK EMPLOYMENT AGREEMENTS. Mutual Savings Bank has
employment agreements with Messrs. Crowley Sr. and Jr. and Maurer, Ms. Scholz,
and certain executive officers of Mutual Savings Bank. The initial terms of the
employment agreements are three years. For Messrs. Crowley, each year the
agreement may be extended so that the agreement remains in effect for a rolling
three years upon agreement of Messrs. Crowley and by affirmative action of
Mutual Savings Bank's board of directors. For the other executives, at the end
of the initial three year term and on each anniversary date thereafter, the
employment term may be extended for an additional year upon agreement of the
executive and by affirmative action taken by Mutual Saving Bank's board. Under
the employment agreements, each executive is entitled to a base salary which is
reviewed annually based upon individual performance and Mutual Saving Bank's
financial results, as well as benefits and perquisites, in accordance with
Mutual Saving Bank's policies.

The initial annual salary amounts for each of the covered executive
officers are as follows: Mr. Crowley, Jr.-$595,000; Mr. Crowley, Sr.-$240,000;
Mr. Maurer-$145,000; and Ms. Scholz-$100,025. These amounts may be changed in
subsequent years, but generally may not be reduced.

The employment agreements can be terminated at the election of the
executive officer or Mutual Savings Bank at the expiration of the term, at any
time for cause, upon the occurrence of certain events specified by federal
statute or regulation, or as a result of the executive officer's retirement,
disability or death. Each employment agreement can also be voluntarily
terminated without cause by the executive officer or Mutual Savings Bank. Each
executive officer may also terminate his or her employment agreement under
certain circumstances following a change in control.

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14

Upon termination of an executive's employment at his or her election at
the expiration of the term of the employment agreements, the executive is
entitled to receive unpaid compensation for the period of employment plus
accrued but unused vacation time. Upon termination of employment at the election
of Mutual Savings Bank at the expiration of the term, the executive is entitled
to receive the same compensation as if he or she had voluntarily terminated at
the end of the term as well as an amount equal to 100% of his or her annual base
salary at the date of termination and certain benefits for a period of twelve
months thereafter.

Upon each executive's death or retirement at age 65, the executive or the
executive's personal representative will receive his or her earned but unpaid
base salary and incentive compensation prorated to the end of the calendar month
in which such termination occurs and compensation for accrued but unused
vacation time. If the executive officer terminates employment voluntarily or is
terminated by Mutual Savings Bank for cause, the executive shall not be entitled
to any compensation or benefits for any period after the date of termination.

If during the term Mutual Savings Bank terminates an executive officer
without cause or the employment agreement is terminated by the executive officer
for cause, the executive would be entitled to receive 100% of base salary at the
time of termination through the end of a severance period. If the termination
occurs within the initial three year term of employment, the severance period
will be through the end of the initial three year term, but not less than one
year, and if the termination shall occur after the initial three year term, the
severance period will be one year. In the case of Messrs. Crowley, the period is
extended to 12 months beyond the current term of employment, but not more than
36 months. Also, the executive would continue to receive certain insurance and
other benefits until twelve months after the end of the term of employment.
Mutual Savings Bank must also pay to each executive an additional lump sum cash
payment in an amount equal to the product of Mutual Savings Bank's annual
aggregate contributions for the benefit of the executive to all qualified
retirement plans in the year preceding termination and the number of years in
the severance period.

Under each employment agreement, the executive officer may also terminate
employment following a change in control of Mutual Savings Bank, as defined in
the agreements, under certain circumstances, including a reduction in
compensation or responsibilities. Upon any such termination as a result of a
change in control, each executive officer has a right to receive payments and
benefits as if a termination by Mutual Savings Bank without cause had occurred.
However, under no circumstances may the aggregate amount of all severance
payments and termination benefits, computed on a present value basis, exceed an
amount which would cause the payments to be characterized as parachute payments
within the meaning of Section 280G(b)(2) of the Internal Revenue Code (the
"Code"). That section generally defines parachute payments to include any
severance payments and termination benefits which, on a present value basis,
equal or exceed three times the executive officer's average annual total
compensation over a five-year period immediately preceding the change in
control.

FIRST NORTHERN EMPLOYMENT AGREEMENTS. First Northern Savings Bank has
employment agreements with Messrs. Meeuwsen and Colberg and several other
executive officers of First Northern Savings Bank.

Mr. Meeuwsen's agreement was entered into in 1990. The initial term of his
agreement was five years; it is automatically extended for an additional year on
the annual anniversary date unless contrary written notice is given by either
First Northern Savings Bank or Mr. Meeuwsen, and has been extended on every
anniversary date. Under his agreement, Mr. Meeuwsen is entitled to a base salary
which is reviewed annually based upon individual performance and the financial
results of First Northern Savings Bank. His annual base salary for 2000 was
$182,000. The agreement also provides that he shall be eligible for incentive
compensation and be entitled to reimbursement of business expenses and other
benefits and perquisites, in accordance with the bank's policies.

The agreement can be terminated at the election of Mr. Meeuwsen or First
Northern Savings Bank at the expiration of the term, at any time for cause, upon
the occurrence of certain events specified by federal statute or regulation, or
as a result of his retirement, disability or death. It can also be voluntarily
terminated without cause by him or First Northern Savings Bank during the term
of the agreement. Mr. Meeuwsen may also terminate his employment agreement under
certain circumstances following a change in control.

Upon termination of Mr. Meeuwsen's employment at his election at the
expiration of his employment agreement, he is entitled to receive unpaid base
salary and incentive compensation for the period of employment and compensation
for accrued but unused vacation time. Upon termination of employment at the
expiration of the

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15

agreement at the election of First Northern Savings Bank, he is entitled to
receive the same compensation as if he had voluntarily terminated at the end of
the term as well as an amount equal to 100% of his annual base salary at the
date of termination and certain benefits for a period of twelve months
thereafter.

Upon Mr. Meeuwsen's death or retirement, he or his personal
representative, as the case may be, shall receive his earned but unpaid base
salary and incentive compensation prorated to the end of the calendar month in
which such termination occurs and compensation for accrued but unused vacation
time. His agreement defines retirement to mean retirement in accordance with and
pursuant to any retirement plan of the bank generally applicable to its
executive officers or in accordance with any arrangements established with his
consent.

If Mr. Meeuwsen terminates employment voluntarily during a term or he is
terminated for cause, as defined in the employment agreement, he shall not be
entitled to any compensation or benefits for any period after the date of
termination. If during the term he is terminated without cause or he terminates
the agreement for cause, he would be entitled to receive 100% of salary at
termination until twelve months after the then-current term, provided that such
compensation may not exceed an amount equal to 60 months of base salary, along
with unpaid base salary and incentive compensation and accrued but unused
vacation time. Mr. Meeuwsen would also continue to receive certain insurance and
other benefits for that period. First Northern Savings Bank must also pay him,
if it terminates him without cause, an additional lump sum cash payment in an
amount equal to the product of First Northern Savings Bank's annual aggregate
contributions for his benefit to all qualified retirement plans in the year
preceding termination and the number of years remaining in his employment
agreement.

Mr. Meeuwsen may also terminate employment following a change in control,
as defined in the agreement, of First Northern Savings Bank or Bank Mutual under
certain circumstances, including a reduction in compensation and benefits or
responsibilities and duties. Upon any such termination as a result of a change
in control, Mr. Meeuwsen has a right under his employment agreement to receive
payments and benefits as if a termination without cause had occurred. Mr.
Meeuwsen agreed not to take any of these benefits in connection with the Bank
Mutual transaction.

The agreement provides that under no circumstances may the aggregate
amount of all severance payments and termination benefits, computed on a present
value basis, exceed an amount which would cause the payments to be characterized
as parachute payments within the meaning of Section 280G(b)(2) of the Code.

Mr. Colberg, along with various other executive officers of First
Northern, had agreements similar to Mr. Meeuwsen's prior to the Bank Mutual
acquisition, although those agreements were generally for a term of three years.
In connection with the Bank Mutual transaction, Mr. Colberg entered into a new
employment agreement with First Northern Savings Bank. The terms of the new
employment agreement are substantially the same as those for Mr. Maurer and Ms.
Scholz described above, with a base salary for 2000 of $88,500 in Mr. Colberg's
case.

OTHER COMPENSATION AGREEMENTS

CROWLEY SR. DEFERRED COMPENSATION AGREEMENT. Mutual Savings Bank has had a
deferred compensation arrangement with Mr. Crowley, Sr. for over 20 years under
which Mutual Savings Bank agreed to defer a portion of Mr. Crowley's
compensation in exchange for compensation payments at the later date. The
precise provisions have been modified from time to time, most recently in a 1998
agreement. To fund this obligation, Mutual Savings Bank purchased a life
insurance policy on the life of Mr. Crowley, Sr. The policy is now fully paid,
and Mutual Savings Bank believes the arrangements are fully funded.

Upon Mr. Crowley, Sr.'s retirement, he will receive a life income in
monthly installments, with a minimum of 240 installments. The monthly
installments will be equal to the amount that would be payable to Mutual Savings
Bank under the life insurance policy if Mutual Savings Bank were to exercise a
settlement option under the policy for monthly life income, with a 240 month
period certain, with payments commencing as of the date of Mr. Crowley's
retirement. If Mr. Crowley were to die before retirement or receipt of 240
monthly payments, the amounts otherwise payable to him will be paid in equal
shares to his two children (including Mr. Crowley, Jr.) or to their survivors.

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16

Under certain circumstances, Mutual Savings Bank may elect to make a lump
sum or other type of payment to Mr. Crowley, Sr. or his heirs. Those payments
would be based upon other forms of payment which may be available under the life
insurance policy.

FIRST NORTHERN SUPPLEMENTAL RETIREMENT AGREEMENTS. First Northern Savings
Bank entered into supplemental retirement agreements with Mr. Meeuwsen and
certain of its other executive officers (including Mr. Colberg). Messrs.
Meeuwsen and Colberg, or their beneficiaries, will receive a total of 180
monthly payments of $10,520 and $2,646 per month, respectively, commencing on
the first day of the month following the earlier of their respective attainment
of age 65 or their death. If the supplemental retirement benefits commence prior
to the executive's attainment of age 65 because of his death, or if the
executive officer requests acceleration of his benefit payments (and the
compensation committee consents to such acceleration), the amount of the monthly
payment will be reduced to reflect a 6% discount rate compounded monthly. These
supplemental retirement agreements are subject to the same parachute payment
limitations that govern employment agreements. Mr. Meeuwsen's supplemental
retirement agreement benefits vested as a result of the Bank Mutual transaction.
Mr. Colberg's benefits were already vested.

OTHER BENEFIT PLANS

EMPLOYEE STOCK OWNERSHIP PLAN. The ESOP is a tax-qualified plan that
covers substantially all salaried employees who have at least one year of
service and have attained age 21. It became effective at the completion of the
Mutual Savings Bank restructuring. Bank Mutual loaned this plan sufficient funds
to purchase up to 8% of the Bank Mutual shares issued to persons other than the
MHC. The ESOP has purchased 60,910 shares in the Mutual Savings Bank
restructuring subscription offering and 830,969 shares on the open market after
the restructuring.

Although contributions to the ESOP are discretionary, beginning in 2001
Bank Mutual intends for there to be employer contributions to the ESOP in each
year which are sufficient to make the required principal and interest payments
on the loan from Bank Mutual. Bank Mutual did not make contributions to the ESOP
in 2000. The loan is for a term of ten years and calls for level annual payments
of principal. Interest payments, at the prime rate, will be made quarterly. The
ESOP initially pledged the shares it purchased as collateral for the loan and
holds them in a suspense account.

The ESOP does not allocate the pledged shares immediately. Instead, it
will release a portion of the pledged shares annually. No shares were released
in 2000. If the ESOP repays its loan as scheduled over a 10-year term, 10% of
the shares will be released annually in 2001 through 2010. The ESOP will
allocate the shares released each year among the accounts of participants in
proportion to their compensation for the year. For example, if a participant's
compensation for a year represents 1% of the total compensation of all
participants for the year, the ESOP would allocate to that participant 1% of the
shares released for the year.

ESOP participants will direct the voting of shares allocated to their
individual accounts. Shares in the suspense account will usually be voted in a
way that mirrors the votes which participants cast for shares in their
individual accounts, although they will be voted as directed by the Bank Mutual
board at the 2001 annual meeting because no shares have yet been allocated to
individual accounts.

RESTORATION PLAN. Mutual Savings Bank also established in 2001 a
"restoration plan" to compensate selected executive officers for any benefits
under the ESOP and the Mutual Savings Bank Savings and Investment Plan which
they are unable to receive because of limitations under the Code on
contributions and benefits. The Code limits the salary deferrals that an
employee may contribute to the Savings Plans and also restricts the amount of
tax-qualified plan benefits that can be received by plan participants.

Commencing in 2001, the restoration plan permits eligible officers (which
includes vice presidents, senior vice presidents or other officers of Mutual
Savings Bank) to defer compensation which they are unable to contribute to the
Savings Plan because of Code limits. In addition, the restoration plan provides
benefits for eligible officers based upon the allocations they would have
received in the ESOP and Savings Plan in the absence of Code limitations. Under
the Code, only the first $170,000 of compensation may be considered in
determining benefits under tax-qualified plans (subject to annual cost-of-living
adjustments).

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17

For example, under the ESOP, only the first $170,000 of earnings are
considered in determining ESOP benefits. Under the restoration plan, an
executive officer would receive an amount equal to the benefit that the officer
would have received under the ESOP in the absence of the compensation limit.
Therefore, if an executive officer had total compensation of $250,000, the
officer would receive an award equal to the average allocation percentage under
the ESOP for the $80,000 of compensation in excess of the Code limit.

The restoration plan initially covers Messrs. Crowley, Sr. and Jr.,
Mr. Maurer, Ms. Scholz and several other persons. However, no benefits were
allocated to any employees under the restoration plan in 2000. The annual
allocations to employees under the restoration plan will not be tax deductible
by the employer or included in the taxable compensation of the employees
receiving the allocations. When benefits are paid to employees following their
termination of employment, the payments will be deductible by the employer and
included in the taxable compensation of the employees receiving those payments.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

COMMITTEE COMPOSITION. Prior to the November 2000 Mutual Savings Bank
Restructuring, the Mutual Savings Bank Finance Committee (n/k/a the
"Compensation Committee") determined salaries, and made other compensation and
plan decisions, relating to Mutual Savings Bank. Thus, compensation decisions
relating to fiscal 2000 were made by the Mutual Savings Bank Finance Committee,
and this report is a report of that committee. For fiscal 2000, the Mutual
Savings Bank Finance Committee consisted of Messrs. Isermann, who died in
January 2001, Mielke and Rolfs.

Going forward, the Bank Mutual board of directors has established a
Compensation Committee. It served to make compensation determinations for 2001,
and expects to continue in that role going forward. The initial members of the
Compensation Committee are identified above under "Election of Directors."

COMPENSATION PHILOSOPHY. In determining compensation, the Committee has
recognized that Mutual Savings Bank must provide its executive officers and key
employees an attractive compensation package in order to attract and retain
talented and highly experienced personnel. The Committee has sought to offer
compensation which it believes is in line with compensation paid by other
similarly situated institutions (including banks, savings banks and savings
associations), so as to be neither unduly generous nor lagging other
institutions.

In making its decisions, the Committee has also noted that, as a mutual
institution, Mutual Savings Bank could not provide stock-based incentive
compensation, as could publicly held institutions. Therefore, the Committee
focused on cash compensation. For 2000, however, because planning for the
possible restructuring had begun, the Committee was mindful that stock-based
compensation might become a possibility in future periods.

BASE SALARY. In determining the base salary of executive officers, the
Committee reviewed, among other things, third party surveys of peer
institutions, the historical compensation of those officers and performance of
Mutual Savings Bank. In that regard, the Committee noted that there was an
acceleration of charges in 1999 relating to the impairment of Mutual Savings'
Banks intangible assets which resulted from a prior acquisition, and the
Committee therefore focused primarily on results before those unusual expense
items.

In making those reviews about Mutual Savings Bank's performance before the
unusual items, the Committee noted that Mutual Savings Bank's profitability in
1999 had decreased modestly as a result of decreased net interest income.
However, the Committee also noted that if the Mutual Savings restructuring were
to proceed, an extraordinary effort would be required of executive officers in
2000. Based upon those results, the Committee determined that the executive
officers should only have a relatively small increase in base salary. Increases
varied from 1% to 4%, except where duties and responsibilities significantly
increased. The Committee also noted that

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18

stock-based incentives would not be available for the year 2000, even if the
restructuring proceeded, although there would be a possibility of cash
incentives.

BONUS/INCENTIVES. For fiscal 2000, cash incentive pay was determined
under the Mutual Savings Bank Management Incentive Compensation Plan. Under that
plan, a set of awards are based on Mutual Savings Bank performance favorably
comparing to the performance of a peer group on selected financial ratios. Also,
loan and deposit growth are compared to budgeted goals. The financial ratios are
constructed to recognize the unique impact of external factors on Mutual Savings
Bank's performance by measuring the relationship of its performance to the peer
group. The plan is designed to require a minimum return on assets before an
incentive award may be paid; at the same time, the plan provides annual goals
which help the bank achieve strategic goals as well as providing a performance
review and measurement system.

Under the incentive plan as in effect during 2000, a bonus of up to 8%
of salary will be determined by the performance of Mutual Savings Bank as
compared to a peer group performance. Mutual Savings Bank's return on equity,
return on assets, net interest margin, non-interest income and non-interest
expense will be compared to the peer group; bonuses may be earned if Mutual
Savings Bank's performance was within or above the average range of those peers.
Because the peer group information for 2000 is not yet available, that portion
of the bonus has not been determined. In addition, a bonus of up to 2% of salary
could be earned if Mutual Savings met its 2000 internal goals on loan growth and
deposit growth. Mutual Savings did not meet those goals in 2000, and therefore
this portion of the bonus was not earned.

CHIEF EXECUTIVE OFFICER COMPENSATION. In addition to the factors
discussed above, when determining the salary of the Chief Executive Officer, the
Committee believed that it was appropriate to begin a transition from base
salary to more incentive-based compensation. Therefore, the Committee only
provided a 3.7% increase in salary to the CEO. The Committee noted, however,
that under the incentive provisions, the Chief Executive Officer would be
eligible to earn a cash incentive bonus of up to 10% of his base salary. The
ultimate bonus number has not yet been determined for fiscal 2000, as a result
of delays in receiving certain third party information. However, the maximum
bonus (if any) will be 8%. In addition, the Committee noted that, if the Mutual
Savings Bank restructuring were to proceed and shareholders approved, the Chief
Executive Officer would be eligible for stock-based compensation going forward.

STOCK-BASED INCENTIVES. Because Mutual Savings Bank was a mutual
institution when 2000 compensation decisions were made, the Committee was not
able to offer the executive officers stock-based compensation such as stock
options or restricted stock grants. Stock option grants to Messrs. Meeuwsen and
Colberg were made under First Northern plans prior to its acquisition by Bank
Mutual.

Going forward, the Committee believes that stock-based compensation can
provide an important incentive to executive officers that also aligns their
interests with those of shareholders, since the value of the compensation will
depend upon the performance of the stock price. The ESOP has been established,
and the 2001 Plan is being submitted to shareholders, to provide certain
stock-based compensation. Because Office of Thrift Supervision ("OTS")
regulations limit the amount and types of stock-based compensation within one
year of Bank Mutual's restructuring, additional or different stock-based
compensation may also be proposed in the future.

SECTION 162(M) LIMITATIONS. Section 162(m) of the Code limits the
deductibility of compensation to certain executive officers of publicly held
companies of over $1 million in any fiscal year. Exceptions are made for, among
other things, performance-based plans approved by shareholders. Mutual Savings
Bank was not subject to Section 162(m) when compensation decisions relating to
fiscal 2000 were made. Going forward, the Committee intends to be mindful of
these limitations. Shareholder approval is being sought, among other reasons,
with respect to the 2001 Plan to qualify for an exception from Section 162(m).

2000 Mutual Savings Bank Finance Committee:

William J. Mielke David J. Rolfs Herbert W. Isermann, Chair (deceased)

-15-

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of the Mutual Savings Bank Finance Committee was an
officer or employee of Mutual Savings Bank or Bank Mutual, nor did they have any
other reportable interlock or transaction. Mr. Lopina, who joined the Bank
Mutual Compensation Committee in December 2000, has an outstanding loan from
First Northern Savings Bank. For a description of Bank Mutual's policies with
respect to loans to officers, directors and employees, and Mr. Lopina's loan,
see "Certain Transactions with Bank Mutual."

PERFORMANCE GRAPH

Set forth below is a line graph comparing the cumulative total
shareholder return on Bank Mutual common stock, based on the market price of the
common stock and assuming reinvestment of cash dividends, with the cumulative
total return of companies on the NASDAQ Stock Market US Index and the SNL Mutual
Holding Company Thrift Index. The graph assumes $100 was invested on November 2,
2000, the first date of Bank Mutual trading, in Bank Mutual common stock and
each of those indices.

Stock/Index 11/02/00 11/30/00 12/31/00
- ----------- -------- -------- --------

Bank Mutual Common Stock $100.00 $ 83.33 $ 93.83
NASDAQ Stock Market (U.S.) $100.00 $ 75.73 $ 71.75
SNL Mutual Holding Company Thrift Index $100.00 $ 102.07 $ 113.45

-16-

APPROVAL OF 2001 PLAN

The information in this Proxy Statement with respect to the proposed
2001 Plan is qualified in its entirety by reference to the text of the Bank
Mutual Corporation 2001 Stock Incentive Plan, which is attached hereto as
Appendix A.

GENERAL

At the annual meeting, Bank Mutual shareholders are asked to approve
the Bank Mutual Corporation 2001 Stock Incentive Plan. The 2001 Plan was adopted
by Bank Mutual's board on February 5, 2001, subject to shareholder approval at
the annual meeting. The 2001 Plan is intended to constitute a stock-based
incentive plan for Bank Mutual, as contemplated in the offering materials for
the restructuring of Mutual Savings Bank in 2000. It includes provisions by
which Bank Mutual may grant directors, executive officers and other officers and
key employees stock options and/or grants of restricted stock under management
recognition provisions. The terms and conditions of any stock incentive plan
adopted within one year of a mutual-to-stock conversion are substantially
limited by regulations of the OTS, and Bank Mutual has drafted the plan to
comply with those OTS regulations. No options or awards have yet been granted
under the 2001 Plan, and will not be granted prior to shareholder approval of
the 2001 Plan.

The 2001 Plan is intended to enhance the operations of Bank Mutual and
its subsidiaries by providing increased incentives for selected officers, key
salaried employees and directors of Bank Mutual. The Bank Mutual board believes
that adoption of the 2001 Plan is desirable because it will promote the
interests of Bank Mutual and its shareholders by strengthening Bank Mutual's
ability to retain and attract key salaried employees and directors, by
encouraging them to maintain their personal interest in Bank Mutual's continued
success and progress, and by providing a means linking personal compensation to
creation of value to shareholders.

The 2001 Plan complies with the regulations of the OTS. However, the
OTS in no way endorses or approves the 2001 Plan. No written or oral
representation shall, or may, be made regarding OTS approval. If any such
representations are made, they should not be relied upon.

THE BANK MUTUAL BOARD OF DIRECTORS HAS ADOPTED THE 2001 PLAN AS
ADVISABLE AND IN THE BEST INTERESTS OF BANK MUTUAL AND ITS SHAREHOLDERS. THE
BOARD UNANIMOUSLY RECOMMENDS THAT BANK MUTUAL SHAREHOLDERS VOTE FOR APPROVAL OF
THE 2001 PLAN.

2001 PLAN

The 2001 Plan provides for the grant of:

- incentive stock options ("ISOs"), intended to qualify within
the meaning of Section 422 of the Code;
- non-qualified stock options ("NSOs"); and
- restricted stock awards under management recognition
provisions.

In this proxy statement, we refer to ISOs and NSOs as "options", and options and
restricted stock grants collectively as "awards".

Under the 2001 Plan, the maximum number of shares of Bank Mutual common
stock that may be issued pursuant to options is 1,114,849, and the maximum
number of shares subject to restricted stock awards is 334,454. As a further
limit required by OTS regulation, Bank Mutual may not purchase for the 2001 Plan
more than 222,970 shares prior to November 1, 2001. That number, when added to
the 891,879 shares purchased by the ESOP, equals 10% of the shares owned by Bank
Mutual shareholders other than the MHC. The total number of shares that may be
issued under the 2001 Plan represents approximately 6.5% of the number of shares
of common stock outstanding and 13% of the shares owned by persons other than
the MHC. The 2001 Plan has a term of ten years.

The 2001 Plan will be administered by a committee designated by the
Bank Mutual board, which initially is the Compensation Committee. The Committee,
in its discretion, will designate the persons to whom awards will be

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made, grant the awards in the form and amount as it determines, and impose such
limitations, restrictions and conditions upon any such award as it deems
appropriate. Key salaried employees and directors of Bank Mutual or any
subsidiary are eligible to receive awards, with the following limits:

- No one person may receive more than 25% of the shares
available for award;
- Non-employee directors may not receive more than 5%
individually, or 30% in the aggregate, of the shares available
for option or award of restricted stock.

Bank Mutual estimates that the number of persons currently eligible to
participate in the 2001 Plan is in the range of 35 to 45, including each of the
executive officers and directors. Bank Mutual cannot determine at this time the
number of awards to be granted in the future to persons named in the Summary
Compensation Table in this Proxy Statement, to all current executive officers as
a group, to all employees as a group or to all directors.

The exercise price of options granted under the 2001 Plan may not be
less than 100% of the fair market value, as defined in the 2001 Plan, of the
shares on the date the option is granted. Unless otherwise determined by the
Committee, 20% of the shares covered by options granted under the 2001 Plan will
become exercisable after one year and an additional 20% in each of the next four
years. Options will have a maximum exercise term of ten years from the date of
grant.

No person may receive an ISO if, at the time of grant, the person owns,
directly or indirectly, more than 10% of the total combined voting power of Bank
Mutual, unless the exercise price is at least 110% of the fair market value of
the shares and the exercise period of such ISO is limited to five years. The
maximum fair market value, determined at time of grant, of shares covered by
ISOs that first become exercisable by any employee in any one calendar year is
limited to $100,000. On March 9, 2001, the fair market value of Bank Mutual
common stock, as defined in the 2001 Plan, was $10.84.

Shares of restricted stock may be issued either alone or in addition to
other awards granted under the 2001 Plan. The Committee will determine the
eligible persons to whom and the times at which grants of restricted stock will
be made, the number of shares to be awarded, the time or times within which such
awards may be subject to forfeiture, and any other terms and conditions of the
awards. Shares of restricted stock will not vest more quickly than provided by
the schedule for options. Grants of restricted stock also may be conditioned
upon the attainment of specified performance goals or other criteria determined
by the Committee, and the provisions of restricted stock awards do not need to
be the same with respect to each recipient.

Each individual receiving a restricted stock award will be issued a
stock certificate in the recipient's name and bearing a legend referring to the
restrictions applicable to the shares. Until the restrictions lapse, a grantee
will not be permitted to transfer or encumber the shares of restricted stock,
but will have all of the other rights of a shareholder, including the right to
vote the shares and the right to receive dividends. All shares still subject to
restriction will be forfeited upon termination of a grantee's service.

In the event of any recapitalization, stock split or reverse split,
stock dividend, merger in which Bank Mutual is the surviving entity, combination
or exchange of shares, or other capital change affecting the Bank Mutual common
stock, appropriate changes in the number and kind of shares available for grant
under the 2001 Plan and in the number, price and kind of shares covered by
outstanding awards shall be made. In the case of an acquisition of Bank Mutual,
the related agreement may provide for conversion of options in an equitable
manner comparable to the consideration received by shareholders.

Special accelerated vesting and exercise rules apply in the event of
death or disability. If an optionee is terminated for cause, all options held by
such optionee shall be deemed terminated and not exercisable.

Payment for shares acquired through the exercise of options issued
under the 2001 Plan may be made either in cash or in shares of Bank Mutual
common stock beneficially owned by the optionee for at least six months prior to
exercise, valued at their fair market value as of the exercise date, or in a
combination thereof.

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Each award under the 2001 Plan will be evidenced by an agreement
containing such terms and conditions as the Committee may establish from time to
time.

TAX CONSEQUENCES

The following is a brief summary of the principal federal income tax
consequences of awards made under the 2001 Plan based upon the applicable
provisions of the Code in effect on the date hereof.

NON-QUALIFIED STOCK OPTIONS. An optionee will not recognize taxable
income at the time an NSO is granted. Upon exercise of an NSO, an optionee will
recognize taxable income in an amount equal to the difference between the
exercise price and the fair market value of the shares at the date of exercise.
The amounts of such difference will be a deductible expense to Bank Mutual for
tax purposes. On a subsequent sale or exchange of shares acquired pursuant to
the exercise of an NSO, the optionee will recognize a taxable gain or loss,
measured by the difference between the amount realized on the disposition and
the tax basis of such shares. The tax basis will, in general, be the amount paid
for the shares plus the amount treated as compensation income at the time the
shares were acquired pursuant to the exercise of the option.

INCENTIVE STOCK OPTIONS. A optionee will not recognize taxable income
at the time an ISO is granted. Further, an optionee will not recognize taxable
income upon exercise of an ISO if the optionee complies with two separate
holding periods: shares acquired upon exercise of an ISO must beheld for at
least two years after the date of grant and for at least one year after the date
of exercise. The difference between the exercise price and the fair market value
of the stock at the date of exercise is, however, a tax preference item. When
the shares of stock received pursuant to the exercise of an ISO are sold or
otherwise disposed of in a taxable transaction, the optionee will recognize a
capital gain or loss, measured by the difference between the exercise price and
the amount realized.

Ordinarily, an employer granting ISOs will not be allowed any business
expense deduction with respect to stock issued upon exercise of an ISO. However,
if all of the requirements for an ISO are met except for the holding period
rules set forth above, the optionee will be required, at the time of the
disposition of the stock, to treat the lesser of the gain realized or the
difference between the exercise price and the fair market value of the stock at
the date of exercise as ordinary income and the excess, if any, as capital gain.
Bank Mutual will be allowed a corresponding business expense deduction to the
extent of the amount of the optionee's ordinary income.

RESTRICTED STOCK. A grantee receiving a restricted stock award will
generally recognize ordinary income in an amount equal to the fair market value
of the stock at the time the stock is no longer subject to forfeiture. While the
restrictions are in effect, the grantee will recognize compensation income equal
to the amount of any dividends received and Bank Mutual will be allowed a
deduction for that amount. A grantee may elect, under Section 83(b) of the Code,
within 30 days of the stock grant, to recognize taxable ordinary income on the
date of grant equal to the fair market value of the shares (determined without
regard to the restrictions) on such date. Bank Mutual will generally be entitled
to a deduction equal to the amount that is taxable as ordinary income to the
grantee in the year that such income is taxable.

CERTAIN TRANSACTIONS WITH BANK MUTUAL

MUTUAL SAVINGS BANK. Mutual Savings Bank has had, and expects to
continue to have, regular business dealings with its officers and directors, as
well as their associates in firms which they serve in various capacities.
Consistent with applicable law, Mutual Savings Bank's policy is that
transactions with its directors and executive officers be on terms that are no
more beneficial to the director or executive officer than Mutual Savings Bank
would provide to unaffiliated third parties. Directors and executive officers,
and their associates, regularly deposit funds with Mutual Savings Bank; the
deposits are on terms and conditions offered to other depositors.

To help prevent any inadvertent violations of its policy, Mutual
Savings Bank discourages lending transactions between Mutual Savings Bank and
its insiders, but loans are occasionally made. Certain of the directors and
executive officers have been indebted to Mutual Savings Bank for loans made in
the ordinary course of business. All such loans have been on substantially the
same terms, including interest rates and collateral, as those

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prevailing at the time for comparable transactions with other persons. These
loans do not involve more than the normal risk of collectability or present
other unfavorable features.

FIRST NORTHERN SAVINGS BANK. Prior to its acquisition by Bank Mutual,
First Northern established somewhat different policies relating to loans to
directors and officers which, consistent with applicable laws and regulations,
permitted certain preferential loan terms to directors and executive officers.
Those policies have continued. The following table sets forth certain data
relating to existing loans with these special terms to directors and executive
officers of Bank Mutual who were formerly First Northern directors or officers
where the aggregate amount of such loans exceeded $60,000 at any time since
January 1, 2000 and the interest rate was below that offered to all other
customers for comparable transactions. (Information for loans with no
preferential terms is not, and need not be, presented.) Management believes that
the loans made to directors, officers and employees do not involve more than the
normal risk of collectability or present other unfavorable features.

INTEREST
ORIGINAL BALANCE RATE DURING COMPARABLE NOTE
NAME AND DATE OF AMOUNT OF AS OF LAST FISCAL RATE FOR OTHER
POSITIONS TYPE LOAN LOAN (1) 12/31/00 YEAR CUSTOMERS
--------- ---- ------- --------- -------- ----------- ---------------

Rick B. Colberg Mortgage 07/20/98 $110,000 $ 98,974 6.25% 6.875%
CFO of Bank Mutual; CFO,
Senior VP and Treasurer of
First Northern Savings

Thomas J. Lopina Mortgage 6/23/93 $110,000 $ 90,087 4.75%(2) 6.25%
Director

Michael D. Meeuwsen Mortgage 02/24/97 $156,000 $104,677 4.75%(2) 7.25%(3)
President of Bank Mutual;
President and CEO of First Second 07/11/91 $100,000 -0- 9.50%(3)
Northern Savings Mortgage

Robert B. Olson Mortgage 7/31/97 $160,000 $130,937 4.75%(2) 7.375%
Director
Second 9/29/98 $100,000(4) $ 62,011 6.875% 6.875%
Mortgage

J. Gus Swoboda Mortgage 4/13/98 $170,000 $148,544 4.75%(2) 6.875%
Director; Chairman of First
Northern Savings Bank Second 1/5/00 $ 60,000 -0- 10.00% 10.00%
Mortgage

- ----------

(1) The largest unpaid balance during 2000 was less than the original amount of
the respective loan.
(2) On January 1, 2000, in accordance with First Northern Savings Bank's
mortgage loan policy for directors, officers and employees, the interest
rate on mortgage loans for officers and directors was 4.75%. The interest
rate for 2001 is 5.50%.
(3) The note interest rate is the prime interest rate.
(4) Line of credit; the amount shown is the maximum.

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REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Bank Mutual board of directors was
constituted upon the effectiveness of the Mutual Savings Bank restructuring. The
Audit Committee oversees and monitors the participation of Bank Mutual's
management and independent auditors throughout the financial reporting process.
No member of the Audit Committee is employed by or has any other material
relationship with Bank Mutual. The members are "independent" as defined in Rule
4200(a)(15) of the NASD listing standards for the Nasdaq Stock Market.

The board of directors has adopted a written charter for the Audit
Committee. A copy of that charter appears as Appendix B to this proxy statement.

In connection with its function to oversee and monitor the financial
reporting process of Bank Mutual, the Audit Committee has done the following:

- reviewed and discussed the audited financial statements for
the fiscal year ended December 31, 2000 with Bank Mutual
management;

- discussed with Ernst & Young LLP, Bank Mutual's independent
auditors, those matters which are required to be discussed by
SAS 61 (Codification of Statements on Auditing Standards, AU
ss.380); and

- received the written disclosures and the letter from Ernst &
Young LLP required by Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees) and has
discussed with Ernst & Young LLP its independence.

Based on the foregoing, the Audit Committee recommended to the board of
directors that those audited financial statements be included in the Bank Mutual
annual report on Form 10-K for the fiscal year ended December 31, 2000.

In addition, the Audit Committee also considered the fees paid to Ernst
& Young LLP for services during 2000. See "Ratification of Independent Auditors"
below. The Committee believes, in view of the substantial transactions which
occurred in 2000, that the provision of the other services is compatible with
maintaining Ernst & Young's independence.

Members of the Audit Committee: William J. Mielke, Chairman Thomas H. Buestrin
Robert B. Olson David J. Rolfs

RATIFICATION OF INDEPENDENT AUDITORS

GENERAL

Bank Mutual shareholders are also being asked to ratify the board of
directors' selection of Ernst & Young LLP as Bank Mutual's independent auditors
for the fiscal year ending December 31, 2001. The firm of Ernst & Young LLP has
audited the books and records of Bank Mutual for 2000; it has served as the
independent accountants for Mutual Savings Bank for more than 20 years. Subject
to shareholder ratification, the board of directors, acting on the
recommendation of the Audit Committee, has appointed the firm of Ernst & Young
LLP as independent auditors to audit the books and accounts of Bank Mutual for
2001. Representatives of Ernst & Young LLP are expected to be present at the
annual meeting to respond to appropriate questions and to make a statement if
they so desire.

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Fees (including reimbursements for out-of-pocket expenses) paid to
Ernst & Young LLP for services in fiscal 2000 were as follows:

Audit Fees $152,000
All Other Fees: $358,965

All other fees include fees for business acquisitions, SEC registration
statements, benefit plan audits and tax and accounting consultations. The Audit
Committee considered the compatibility of non-audit services by Ernst & Young
LLP with the maintenance of Ernst & Young's independence.

RECOMMENDATION OF THE BOARD OF DIRECTORS

The board of directors recommends that shareholders vote FOR the
ratification of the selection of Ernst & Young LLP.

SHAREHOLDER PROPOSALS

Shareholder proposals must be received by the Secretary of Bank Mutual,
Eugene H. Maurer, no later than November 30, 2001 in order to be considered for
inclusion in next year's annual meeting proxy materials pursuant to SEC Rule
14a-8.

Under SEC rules relating to the discretionary voting of proxies at
shareholder meetings, if a proponent of a matter for shareholder consideration
(other than a shareholder proposal) notifies Bank Mutual at least 45 days prior
to the month and day of mailing the prior year's proxy statement, then
management proxies are allowed to use their discretionary voting authority if a
proposal is raised at the annual meeting, without any discussion of the matter
in the proxy statement. Therefore, any such matters must be received by Bank
Mutual by February 11, 2002 in the case of the Bank Mutual 2002 annual meeting
of shareholders. Bank Mutual is not aware of any such proposals for the 2001
annual meeting.

By Order of the Board of Directors

Eugene H. Maurer, Jr.
Senior Vice President and Secretary

Milwaukee, Wisconsin
March 27, 2001

A copy (without exhibits) of Bank Mutual's Annual Report on Form 10-K filed with
the SEC for the year ended December 31, 2000 is attached to this proxy
statement. Bank Mutual will provide an additional copy of the 10-K (without
exhibits) without charge to any record or beneficial owner of Bank Mutual common
stock on the written request of that person directed to: Rick B. Colberg, Chief
Financial Officer, Bank Mutual Corporation, 4949 West Brown Deer Road,
Milwaukee, Wisconsin 53223.

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APPENDIX A
BANK MUTUAL CORPORATION

2001 STOCK INCENTIVE PLAN

I. PURPOSE

1.01 ESTABLISHMENT OF PLAN. The purpose of this Plan is to promote
the growth and development of Bank Mutual Corporation ("Bank Mutual") by
providing increased incentives for key salaried employees and directors of Bank
Mutual and of any present or future Subsidiaries. A "Subsidiary" as used herein
shall mean any corporation in which Bank Mutual or another corporation
qualifying as a Subsidiary within this definition owns 50% or more of the total
combined voting power of all classes of stock. This Plan provides for the
granting of (i) incentive stock options ("ISOs") intended to qualify as such
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code"), (ii) non-qualified stock options
("NSOs"), and (iii) Management Recognition Awards. The three types of benefits
that may be granted under the Plan are collectively referred to as "Awards".

II. SHARES SUBJECT TO OPTION

2.01 AVAILABLE SHARES. A total of not more than 334,454 shares of
Bank Mutual common stock are available for the issuance of Management
Recognition Awards under the Plan and a total of not more than 1,114,849 shares
of Bank Mutual common stock are available for the issuance of other Awards under
the Plan. The shares issued under the Plan must be shares issued and reacquired
by Bank Mutual; provided, however, that such shares may be authorized but
unissued shares if permitted by OTS regulations then in effect. Shares subject
to and not issued under an Award which expires, terminates or is cancelled for
any reason during the term of the Plan shall again become available for the
granting of Awards under the Plan.

2.02 CHANGES IN THE NUMBER OF AVAILABLE SHARES. In the event of any
recapitalization, stock split or reverse split, combination or exchange of
shares, stock dividend, merger in which Bank Mutual is the surviving
corporation, combination or exchange of shares, or other capital change
affecting the common stock of Bank Mutual, the Committee (defined in Section
3.01 hereof) shall make, subject to the approval of the Board of Directors of
Bank Mutual, equitable and appropriate changes in the aggregate number and kind
of shares available for which Awards may be granted under the Plan and in the
number, price and kind of shares covered by Awards granted or to be granted
under the Plan, provided that no changes shall be made in any ISO which would
cause such option to fail to continue to qualify as an incentive stock option
within the meaning of Section 422 of the Code.

III. ADMINISTRATION

3.01 ADMINISTRATION BY THE COMMITTEE. The Plan shall be
administered by a committee designated by the Board of Directors of Bank Mutual
(the "Committee"), and shall initially be the Compensation Committee of the
Board. The Committee shall be constituted to permit the Plan to comply with the
provisions of Rule 16b-3 under the Securities Exchange Act of 1934, as amended
or any successor rule ("Rule 16b-3") and Section 162(m) of the Code. A majority
of the members of the Committee shall constitute a quorum. The approval of such
a quorum, expressed by a vote at a meeting, or the unanimous consent of all
members in writing without a meeting, shall constitute the action of the
Committee and shall be valid and effective for all purposes of the Plan. The
Committee is empowered to adopt such rules, regulations and procedures and take
such other action as it shall deem necessary or proper for the administration of
the Plan. Subject to Section 8.04 hereof, the Committee, in its discretion, may
modify, extend or renew any Award theretofore granted. The Committee shall also
have authority to interpret the Plan, and the decision of the Committee on any
questions concerning the interpretation of the Plan shall be final and
conclusive. The Committee may consult with counsel, who may be counsel for the
Company, and shall not incur any liability for any action taken in good faith in
reliance upon the advice of counsel. The Committee shall have the power, subject
to and within the limits of the express provisions of the Plan:

A-1

(a) to determine from time to time which of the eligible persons
shall be granted Awards under the Plan, the type of Awards,
and time or times when, and the number of shares for which, an
Award or Awards shall be granted to such persons;

(b) to prescribe the other terms and provisions (which need not be
identical) of each Award granted under the Plan to eligible
persons;

(c) to construe and interpret the Plan and Awards granted under
it, and to establish, amend and revoke rules and regulations
for Plan administration. The Committee, in the exercise of
this power, may correct any defect or supply any omission, or
reconcile any inconsistency in the Plan, or in any agreement,
in the manner and to the extent it shall deem necessary or
expedient to make the Plan fully effective. All decisions and
determinations by the Committee in exercising this power shall
be final and binding upon Bank Mutual and the individuals; and

(d) generally, to exercise such powers and to perform such acts as
are deemed necessary or expedient to promote the best
interests of Bank Mutual with respect to the Plan.

IV. ELIGIBILITY FOR AWARDS

4.01 ELIGIBILITY. Key salaried employees and directors of Bank
Mutual or any Subsidiary shall be eligible to receive Awards.

4.02 GRANT OF AWARDS. From among all eligible persons, the
Committee shall determine from time to time those persons to whom Awards shall
be granted, provided that (i) no eligible person shall be eligible to receive an
Award or Awards covering or relating to, in the aggregate, more than 25% of the
shares available for issuance under the Plan and (ii) directors of Bank Mutual
or a Subsidiary who are not also employees of Bank Mutual or any Subsidiary may
not receive more than 5% individually, or 30% in the aggregate, of the option
shares available for issuance under the Plan. No person shall have any right
whatsoever to receive an Award unless so determined by the Committee.

V. OPTION TERMS AND CONDITIONS

5.01 OPTION CONTRACTS. Options granted hereunder shall be evidenced
by option contracts containing such terms and conditions as the Committee shall
establish from time to time consistent with the Plan. Option contracts need not
be identical but each option contract shall, as appropriate, contain language
including the substance of the following provisions:

(a) NUMBER OF SHARES AND PRICE. Each option contract shall state
the number of shares to which it pertains and the option price
therefor. Such price for each ISO or NSO shall be not less
than 100% of the fair market value of the shares on the date
such option is granted. For all purposes of the Plan, fair
market value shall mean average of the high and low sales
prices for the shares in the over-the-counter market on the
valuation date, as reported by NASDAQ (the National
Association of Securities Dealers, Inc. Automatic Quotation
System). In the absence of reported sales on NASDAQ on any
trading date, fair market value shall be the average of the
reported closing bid and asked price for the stock on NASDAQ
on such date. Notwithstanding any other provision in this
Plan, for any eligible employee who, at the time an ISO is
granted, owns (directly and under the attributable rules of
Section 425(d) of the Code) stock possessing more than 10% of
the total combined voting power of Bank Mutual (or any parent
or Subsidiary) the option price under such ISO shall be not
less than 110% of the fair market value of the shares subject
to such ISO and such option, by its terms, shall not be
exercisable after the expiration of five years from the date
such option is granted.

(b) VESTING OF OPTIONS. Options may be exercised only in
accordance with the terms of each option contract. For vesting
purposes, options may not be deemed to have been granted prior
to the

A-2

date of shareholder approval of the Plan. Unless the Committee
determines otherwise at the time of grant, no option shall be
exercisable until the optionee has completed at least the
number of years of continuous service from the date of grant
of each option as follows, and then the same shall be
exercisable for any amount of shares covered by such option up
to the maximum percentage of shares covered thereunder as
follows:

Number of Completed Years of Maximum Percentage of
Continuous Service After Shares Becoming Exercisable
the Date of Grant of Option Under the Option
---------------------------- -------------------------

Less than 1 year Zero
At least 1 but less than 2 20%
At least 2 but less than 3 40%
At least 3 but less than 4 60%
At least 4 but less than 5 80%
At least 5 years 100%

To the extent provided in Article VI, all options then
outstanding shall become immediately exercisable. No
fractional shares shall be issuable on exercise of any option
and if the application of the maximum percentage set forth
above would result in a fractional share, the number of shares
exercisable shall be rounded up to the next full share.
Finally, the maximum fair market value of Bank Mutual stock
(determined at the time of grant) covered by ISOs that first
become exercisable by any optionee in any calendar year is
limited to $100,000.

(c) TERM OF OPTIONS AND RESTRICTION ON EXERCISE. Unless otherwise
determined by the Committee, all rights to exercise an ISO or
NSO shall expire ten years from the date of option grant.
Although Bank Mutual intends to exert its best efforts so that
the shares purchasable upon the exercise of an option will be
registered under, or exempt from the registration requirements
of the federal Securities Act of 1933 and any applicable state
securities law at the time the option becomes exercisable, if
the exercise of an option would otherwise result in the
violation by Bank Mutual of any provision of such Act or of
any state securities law, Bank Mutual may require that such
exercise be deferred until Bank Mutual has taken appropriate
action to avoid any such violation.

(d) NONTRANSFERABILITY. Except as provided in Article VI hereof:

(i) all options granted pursuant to the Plan shall not be
transferable except by will or the laws of descent and
distribution, and shall be exercisable during the optionee's
lifetime only by the optionee or by his/her guardian or legal
representative; and

(ii) no options or any privileges pertaining thereto or under
the Plan shall be transferred, assigned, pledged or
hypothecated in any way, whether by operation of law or
otherwise, nor be subject to execution, attachment or similar
process.

(e) METHOD OF EXERCISE AND PAYMENT OF PURCHASE PRICE. Subject to
(c) above, an option may be exercised, as to all or part of
the shares covered by the option, by the optionee delivering
to the Committee at its principal business office on any
business day, a written notice specifying the number of shares
the optionee desires to purchase. The option price shall be
paid in full in cash or, in the discretion of the Committee in
shares of stock of Bank Mutual which have been beneficially
owned by the optionee for at least six months prior to the
time of exercise, valued at their fair market value determined
as of the date of exercise, or in a combination thereof.

5.02 RIGHTS AS SHAREHOLDER. An optionee shall not be deemed the
holder of any shares covered by an option until such shares are fully paid and
issued to him/her after exercise of such option.

A-3

VI. TERMINATION OF SERVICE

6.01 DEATH. In the event of the death of an optionee while in the
service of Bank Mutual or its Subsidiaries, the options then held by such
optionee, whether or not otherwise exercisable at the time of such death, may be
exercised, by the estate of the optionee or by a person who acquired the right
to exercise such options by bequest or inheritance from such optionee, within
one year after the date of such death, but not later than the date on which the
options would otherwise expire. Any options or portions thereof not so exercised
shall terminate.

6.02 DISABILITY. If the service of an optionee is terminated by
reason of disability (in case of an ISO, as defined in Section 105(d)(4) of the
Code and in case of an NSO, as determined by the Committee), the options then
held by such optionee may be exercised, whether or not otherwise exercisable at
the time of such termination, within one year after such termination, but not
later than the date on which the options would otherwise expire. Any options or
portions thereof not so exercised shall terminate.

6.03 OTHER TERMINATION. If the service of an optionee is terminated
for any reason other than such death or disability, options then held by such
optionee to the extent that the same are exercisable on the date of such
termination may be exercised at any time within one year thereafter (provided
that any ISO exercised more than three months after the optionee's termination
of employment will not be eligible for tax treatment as an ISO and instead will
be treated as an NSO), but not later than the date on which the options would
otherwise expire. However, notwithstanding any other provision of the Plan, if
the service of an optionee is terminated for cause, as determined by the
Committee, all options then held by such optionee shall be deemed terminated and
not exercisable by such optionee.

6.04 TRANSFERS AND LEAVES. A change in employment from Bank Mutual
to a Subsidiary, or vice versa, shall not constitute termination of employment
for purposes of the Plan. The Committee may determine that for purposes of the
Plan, an optionee who is on leave of absence (but in the case of ISOs, only to
the extent that employment is not determined to be interrupted thereby for
purposes of Section 422 of the Code) will still be considered as in the
continuous employment of Bank Mutual or a Subsidiary.

VII. MANAGEMENT RECOGNITION AWARDS

7.01 ADMINISTRATION. Management recognition awards may be issued
either alone or in addition to other Awards granted under the Plan. The
Committee shall determine the eligible persons to whom and the time or times at
which management recognition awards will be granted, the number of shares to be
awarded, the time or times within which such Awards may be subject to forfeiture
and any other terms and conditions of the Awards. The Committee may condition
the grant of Management Recognition Awards upon the attainment of specified
performance goals or such other factors or criteria as the Committee shall
determine. The provisions of the Awards need not be the same with respect to
each recipient.

7.02 AWARDS AND CERTIFICATES. Each individual receiving a
Management Recognition Award shall be issued a certificate in respect of such
shares. Such certificate shall be registered in the name of such individual and
shall bear an appropriate legend referring to the terms, conditions, and
restrictions applicable to such Award, substantially in the following form:

"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions (including
forfeiture) of the Bank Mutual Corporation 2001 Stock Incentive Plan
and an agreement identifying the restrictions applicable to the shares.
Copies of such Plan and agreement are on file at the corporate office
of Bank Mutual."

The Committee may require that the certificates evidencing such shares
be held in custody by Bank Mutual until the restrictions thereon shall have
lapsed and that, as a condition of any Award, the grantee shall have delivered a
stock power, endorsed in blank, relating to the stock covered by such Award.

7.03 TERMS AND CONDITIONS. Management Recognition Awards shall be
subject to the following terms and conditions:

A-4

(a) Until the applicable restrictions lapse, the grantee shall not
be permitted to sell, assign, transfer, pledge or otherwise
encumber the shares.

(b) The grantee shall have, with respect to the shares covered by
the Award, all of the rights of a stockholder of Bank Mutual,
including the right to vote the shares and the right to
receive any cash dividends. Unless otherwise determined by the
Committee, cash dividends shall be automatically paid in cash
and dividends payable in stock shall be paid in the form of
additional restricted stock.

(c) Except to the extent otherwise provided in the applicable
agreement and (d) below, all shares still subject to
restriction shall be forfeited by the grantee upon termination
of a grantee's service for any reason.

(d) The restrictions applicable to any Management Recognition
Award may lapse no more quickly and in no greater percentage
than options are allowed to vest under Section 5.01(b) above.

(e) If and when the applicable restrictions lapse, unlegended
certificates for such shares shall be delivered to the
grantee.

(f) Each Award shall be confirmed by, and be subject to the terms
of, an agreement identifying the restrictions applicable to
the shares.

(g) The aggregate amount of all shares of Bank Mutual common stock
obtained by any Bank Mutual tax-qualified employee stock
benefit plan in Mutual Savings Bank's restructuring completed
November 1, 2000 or within one year following the
restructuring, together with the number of shares of Bank
Mutual common stock available for issuance as Management
Recognition Awards under the Plan, shall not exceed 1,114,849
shares.

VIII. MISCELLANEOUS

8.01 TERM OF PLAN AND EFFECTIVE DATE. Awards may be granted under
this Plan at any time up until the expiration of ten years following the
Effective Date of the Plan; on which date the plan shall expire, except as to
outstanding options, which options shall remain in effect until they have been
exercised or have expired. The Effective Date of the Plan shall be February 5,
2001, the date of its adoption by the Board of Directors of Bank Mutual,
subject, however, to approval by the shareholders of Bank Mutual within a period
of twelve months after such adoption. Notwithstanding any other provision
hereof, no options granted hereunder shall be exercisable and no restriction
with respect to any Award shall lapse, until a date at least one year after such
shareholder approval has been obtained.

8.02 NO EMPLOYMENT OR RETENTION AGREEMENT INTENDED. The grant of an
Award hereunder shall not be deemed to imply the right to continued service in
any capacity by Bank Mutual or a Subsidiary and shall not constitute an
employment agreement or retention agreement of any kind.

8.03 SEPARATE PLAN. This Plan is separate and independent from any
other stock incentive plan or similar plan of Bank Mutual.

8.04 AMENDMENT OR DISCONTINUANCE. The Board of Directors of Bank
Mutual may amend or discontinue this Plan at any time, but may not, without the
consent of the optionee to whom an option has been granted, make any alteration
in such option which would adversely affect the same, or be made without
shareholder approval if such approval would be required in order to comply with
Rule 16b-3, the Code or the applicable regulations of the OTS.

8.05 LIABILITY. No member of the Board of Directors, or the
Committee, or the officers or employees of Bank Mutual shall be personally
liable for any action, omission or determination made in good faith in
connection with the Plan.

A-5

8.06 GOVERNMENT AND OTHER REGULATIONS. The obligations of Bank
Mutual to sell and deliver shares of stock under this Plan shall be subject to
all applicable laws, rules and regulations and the obtaining of all such
approvals by the governmental agencies as may be deemed necessary or desirable
by the Board of Directors of Bank Mutual, including (without limitation) the
satisfaction of all applicable federal, state and local tax withholding
requirements.

8.07 WITHHOLDING TAXES. All distributions under the Plan shall be
subject to any required withholding taxes and other withholdings and, in case of
distributions in Bank Mutual common stock, the participant or other recipient
may, as a condition precedent to the delivery of said common stock, be required
to pay to his/her participating employer the excess if any, of the amount of
required withholding if any, from distributions in cash under the Plan. The
required withholding may be paid in full or in the discretion of the Committee,
in shares of stock of Bank Mutual, valued at its fair market value as of the
date the withholding obligation arises, or in a combination thereof. Any such
request or election (to satisfy a withholding obligation using shares) by an
individual who is subject to the provisions of Section 16 of the Securities
Exchange Act of 1934 shall be made in accordance with the rules and regulations
of the Securities and Exchange Commission promulgated thereunder. No
distribution under the Plan shall be made in fractional shares of Bank Mutual's
common stock but the proportional market value thereof shall be paid in cash.

8.08 GOVERNING LAW. This Plan and any option contracts extended
pursuant hereto shall be interpreted and enforced in accordance with the laws of
the State of Wisconsin.

A-6

APPENDIX B

BANK MUTUAL CORPORATION
AUDIT COMMITTEE CHARTER

The Audit Committee of the Bank Mutual Board of Directors shall have
the authority, duties and responsibilities specified below. As used in this
Charter, "Bank Mutual" refers to Bank Mutual Corporation, and the "Company"
refers to Bank Mutual together with its direct and indirect subsidiaries.

AUTHORITY

The Audit Committee is authorized to review the financial statements
prepared by management and the annual audit of Bank Mutual, and to review any
other activity of the Company in connection therewith that they deem
appropriate. All Company employees are directed to cooperate as required by
members of the Committee. The Committee may retain persons having special
competence, such as counsel, auditors or other advisors, if and as necessary to
assist the Committee in fulfilling its responsibilities.

RESPONSIBILITIES

The Audit Committee shall coordinate communication among directors who
are not members of the Committee, the independent accountants and management as
their duties relate to financial accounting, reporting and controls. The
Committee shall assist the Board in fulfilling its fiduciary responsibilities as
to Bank Mutual's accounting policies and reporting practices, and the
sufficiency of auditing relating thereto. The Committee is to be the Board's
principal agent in assuring the independence of the independent accountants, the
integrity of management, and the adequacy of disclosures to shareholders.
However, the independent accountants are ultimately responsible to the entire
Board, and the opportunity for the independent accountants to meet with the
entire Board as needed or desired, or the Board as a whole to take appropriate
action, is not restricted.

In fulfilling these responsibilities, the Audit Committee shall:

1. Confirm that management and the independent accountants are
aware that the accountants and the Committee may communicate
with each other at any time.

2. Review with management and independent accountants the
Company's general policies and procedures, both for financial
and regulatory purposes, to reasonably assure the adequacy of
the Company's internal accounting and financial reporting
controls.

3. Have familiarity with the accounting and reporting principles
and practices which are applied by Bank Mutual in preparing
its financial statements and its subsidiaries' regulatory
reports, as well as its established standards of corporate
conduct and performance, and deviations therefrom.

4. Review the scope and general extent of the independent
accountants' audit examination, including their engagement
letter. The auditors' fees are to be arranged with management,
and annually summarized for Committee review. The Committee's
review should entail an understanding from the independent
accountants of the factors considered in determining the audit
scope.

5. Review the scope of authority of the Company's internal audit
staff, and review the staff's performance of internal audit
duties.

B-1

6. Consider and review the independence of the independent
accountants, including any written disclosures required from
them and the scope and extent of nonaudit services which may
be provided by the independent accountants in relation to the
objectivity needed from them in the audit.

7. Review with management and the independent accountants, upon
completion of their audit, the financial results for the year.

8. Provide any reports or summaries which may be required for the
annual report to shareholders and/or Form 10-K, and review
(either together as a committee or by individual members)
proposed Company quarterly and annual disclosures.

9. Evaluate the cooperation received by the independent
accountants during their audit examination, including their
access to all requested records, data and information. Inquire
of the independent accountants whether there have been any
disagreements with management which if not satisfactorily
resolved would have caused them to issue a nonstandard report
on the financial statements.

10. Discuss with the independent accountants the quality of the
Company's financial and accounting personnel, and any relevant
recommendations which the independent accountants may have,
including those in their "letter of comments and
recommendations."

11. Review the written responses of Bank Mutual's management to
the independent accountants' comment letter.

12. Discuss with management the scope and quality of internal
accounting and financial reporting controls in effect. Also,
obtain management comments on the responsiveness of the
independent accountants to Bank Mutual's needs.

13. Recommend to the Board of Directors the retention or
nonretention of the independent accountants, and the basis for
any recommendations.

14. Conduct an appropriate review of related party transactions
with Bank Mutual on an ongoing basis and review potential
conflict of interest situations or questions where
appropriate.

15. Review periodically, in accordance with SEC and NASDAQ
requirements, and recommend to the Board of Directors any
appropriate extensions or changes in the duties of the
Committee and/or changes to this Charter.

16. Update the Board of Directors, through minutes and
presentations as may be necessary or appropriate, of
significant developments in the course of performing the above
duties.

It is not the intention of this Charter that the Committee have the
duty to plan or conduct audits or to determine that the financial statements are
complete and accurate and are in accordance with generally accepted accounting
principles. Those matters are the responsibility of management and the
independent auditors. It is also not the duty of the Audit Committee to conduct
investigations, to resolve disagreements, if any, between management and the
independent auditor or to assure compliance with laws and regulations.

ADMINISTRATIVE MATTERS

MEMBERSHIP

The Audit Committee shall consist of three or more directors. The
Committee members shall meet the independence and experience requirements of the
Nasdaq Stock Market. One of the members shall be appointed as the Committee's
Chairman by the Board of Directors or, alternatively, by the Committee members.

B-2

MEETINGS

The Audit Committee is to meet at least twice per year, and as many
other times as that Committee deems necessary. At least one meeting shall occur
shortly after the completion of the audit process to provide Bank Mutual's
independent auditors the opportunity to meet with the Committee and review the
audit process and results. The Chairman may call a meeting at any time he or she
believes is necessary or appropriate.

ATTENDANCE

At least a majority of the members of the Audit Committee are to be
present at all meetings. As necessary or desirable, the Chairman may request
that members of management and/or representatives of the independent accountants
be present at meetings.

MINUTES

The Committee shall arrange for the preparation of minutes of each
meeting, and make them available to be sent to all Committee members and
directors who are not members of the Committee. If Bank Mutual's corporate
Secretary has not taken the minutes, they should be sent to him or her for
inclusion in the minute books.

B-3
35
REVOCABLE PROXY
BANK MUTUAL CORPORATION

[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE

ANNUAL MEETING OF SHAREHOLDERS
MAY 8, 2001

The undersigned hereby appoints Michael T. Crowley, Jr., Rick B. Colberg
and Eugene H. Maurer, Jr., and each of them, with full power of substitution, to
act as attorneys and proxies for the undesigned to vote all shares of common
stock of Bank Mutual Corporation which the undersigned is entitled to vote at
the annual meeting of shareholders (the "Meeting") to be held at the Four
Points Sheraton Milwaukee North Hotel, 8900 N. Kildeer Court, Milwaukee,
Wisconsin on Tuesday, May 8, 2001, at 10:00 a.m., and at any and all
adjournments and postponements thereof.

1. The election of the following nominees as director for terms as follows
(except as marked to the contrary below):

For With- For All
All hold Except

[ ] [ ] [ ]

MICHAEL T. CROWLEY, SR., RAYMOND W. DWYER, JR., J. GUS SWOBODA
(terms expire in 2004)

MICHAEL D. MEEUWSEN
(term expires in 2003)

MARK C. HERR, THOMAS J. LOPINA, JR., ROBERT B. OLSON
(terms expire in 2002)

INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write the nominee's name(s) in the space provided below.

2. Approval of the Bank Mutual Corporation 2001 Stock Incentive Plan.

For Against Abstain

[ ] [ ] [ ]

3. The ratification of the appointment of Ernst & Young LLP as auditors for
the Company for fiscal 2001.

For Against Abstain

[ ] [ ] [ ]

I/WE PLAN TO ATTEND THE MEETING. [ ]

In their discretion, the proxies are authorized to vote on any other
business that may properly come before the Meeting or any adjournment or
postponement thereof.

THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE PROPOSALS AND THE NOMINEES LISTED ABOVE. IF ANY
OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY THOSE
NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME THE BOARD OF
DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.

The Board of Directors recommends a vote "FOR" the proposals and the
election of the nominees listed above.

Please be sure to sign and date this Proxy in the box below.

Date ___________________________

________________________________
Shareholder sign above

________________________________
Co-holder (if any) sign above

- --------------------------------------------------------------------------------

DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED.

BANK MUTUAL CORPORATION

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

Should the above signed be present and choose to vote at the Meeting or at
any adjournments or postponements thereof, and after notification to the
Secretary of Bank Mutual at the Meeting of the shareholder's decision to
terminate this proxy, then the power of such attorneys or proxies shall be
deemed terminated and of no further force and effect. This proxy may also be
revoked by filing a written notice of revocation with the Secretary of Bank
Mutual or by duly executing a proxy bearing a later date.

The above signed acknowledges receipt from Bank Mutual, prior to the
execution of the proxy, of a notice of annual meeting of shareholders, a proxy
statement and an annual report to shareholders.

Please sign exactly as your name(s) appear(s) on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.

PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE.

HAS YOUR ADDRESS CHANGED?

_______________________________________