REVOCABLE PROXY

                          MARION CAPITAL HOLDINGS, INC.
                         SPECIAL MEETING OF SHAREHOLDERS

                            [_________________], 2000


         The  undersigned  hereby  appoints  the  Board of  Directors  of Marion
Capitol Holdings, Inc. ("Marion Capital"),  and its successors,  with full power
of substitution, to act as attorneys and proxies for the undersigned to vote all
shares of common stock of Marion  Capital which the  undersigned  is entitled to
vote at Marion Capital's Special Meeting of Shareholders (the "Meeting"),  to be
held      on      [_______day],      [_____________      __],      2000,      at
[_____________________________________________________________________________],
located at  [____________________________________________]  at  [__:__]  [_].m.,
local  time,  and at any and all  adjournments  and  postponements  thereof,  as
follows:

     The  approval  of an  Agreement  and Plan of Merger by and  between  Marion
     Capital Holdings, Inc. and MutualFirst Financial, Inc., dated June 7, 2000.

                       FOR               AGAINST         ABSTAIN
                       ---                 ---             ---
                      |   |               |   |           |   |
                       ---                 ---             ---

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.

The Board of Directors recommends a vote "FOR" adoption of the Merger Agreement.


THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR ADOPTION OF THE MERGER AGREEMENT.  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.







           THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

         The  shareholder  may revoke  this proxy at any time before it is voted
by: (1) filing with the  Secretary of Marion  Capital at or before the Meeting a
written  notice of  revocation  bearing a later date than this  proxy;  (2) duly
executing a subsequent  proxy  relating to the same shares and  delivering it to
the Secretary of Marion  Capital at or before the Meeting;  or (3) attending the
Meeting and voting in person (although attendance at the Meeting will not in and
of itself  constitute  revocation  of this  proxy).  If this  proxy is  properly
revoked as described above, then the power of the attorneys and proxies shall be
deemed terminated and of no further force and effect.

         The undersigned  acknowledges receipt from Marion Capital, prior to the
execution  of  this  proxy,   of  Notice  of  the  Meeting  and  a  Joint  Proxy
Statement/Prospectus.


        Dated:  ________________________




       --------------------------------     ------------------------------------
       PRINT NAME OF SHAREHOLDER            PRINT NAME OF SHAREHOLDER


       --------------------------------     ------------------------------------
       SIGNATURE OF SHAREHOLDER             SIGNATURE OF SHAREHOLDER


                           Please  sign  exactly as your name  appears  above on
                           this  card.  When  signing  as  attorney,   executor,
                           administrator, trustee, guardian or corporate officer
                           please  give your  full  title.  If  shares  are held
                           jointly, each holder should sign.

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                     PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL THIS PROXY IN
                                    THE ENCLOSED POSTAGE-PAID ENVELOPE
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                                                         YES               NO
I Plan to attend the Marion Capital Holdings, Inc.        _                 _
Special Meeting.                                         |_|               |_|