POLARIS AND HSBC RETAIL SERVICES MODIFY RETAIL CREDIT FINANCING RELATIONSHIP
12 August 2005 - Polaris Industries, Inc.

New Agreement Maintains the Income Potential to Polaris While Eliminating All Credit Risk

Polaris Industries Inc. announced today that it has entered into a new multi-year contract with HSBC Bank Nevada, National Association, formerly known as Household Bank (SB), N.A. (''HSBC'') under which HSBC will continue managing the Polaris private label credit card program under the StarCard label.

The Polaris StarCard will continue to make it easy for Polaris dealers to offer their customers a convenient way to purchase Polaris vehicles, parts, garments and accessories. HSBC has aligned with Polaris to develop industry leading consumer credit programs and high impact direct marketing campaigns for acquiring new customers and retaining existing customers.

The terms of the new multi-year agreement, executed on August 10, 2005, became effective as of August 1, 2005. The new agreement provides for income to be paid to Polaris based on a percentage of the volume of retail credit business generated. The previous agreement provided for equal sharing of all income and losses with respect to the retail credit portfolio. The new contract removes all credit and funding risk to Polaris immediately and also eliminates the need for Polaris to maintain a retail credit cash deposit with HSBC, which was $49.8 million at June 30, 2005.

Mike Malone, Vice President--Finance, Chief Financial Officer and Secretary of Polaris, stated, ''We are pleased that we were able to enter into this new agreement with HSBC, a leader in the consumer credit industry. This new structure will allow Polaris to substantially reduce the risk associated with our retail credit program while maintaining the current income potential of the business. In addition, Polaris is no longer required to maintain the retail credit cash deposit on our balance sheet, and those funds will be available to pay down existing borrowings on our bank line of credit arrangement. We expect that this new structure will position Polaris for a strong and stable future in retail financial services as we concentrate on growing our powersports business.''

''Since our relationship began in 2001, we''ve worked closely with Polaris to build a powerful, integrated retail credit program that helps drive vehicle and accessory sales,'' said Richard Klesse, managing director of client relations for HSBC''s retail services business. ''Revising our relationship allows us to focus on providing our proven financing expertise while Polaris focuses on generating additional growth from its powersports business.''

www.polarisindustries.com

More News
  For August 2005
  From Polaris Industries, Inc.
  For Corporate
  Biker247.com Home Page