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EXHIBIT 99.1

PRESS RELEASE:

                JACOBS FINANCIAL GROUP APPROVES RECAPITALIZATION

Charleston,  West Virginia,  October 26, 2009. Jacobs Financial Group, Inc. (OTC
Bulletin  Board:  JFGI),  today  announced that the Corporation has received the
approval  of the  holders of a majority  of its  outstanding  shares of Series B
Preferred Stock ("Series B Shares") to implement a proposed  recapitalization of
the   Series   B   Preferred   (the   "Recapitalization").   Pursuant   to   the
Recapitalization, participating Series B Shareholders will exchange their Series
B Shares for  shares of a new  series of  preferred  stock to be  designated  as
Series C Preferred Stock. The purpose of the  Recapitalization  is to strengthen
the balance sheet of the Corporation. This will be accomplished by replacing the
participating  Series B  Shares,  which are  classified  as a  liability  of the
Corporation  for  financial  statement  purposes  based upon the Series B Shares
becoming redeemable at the end of 2010, with Series C Shares (which are expected
to be classified as permanent equity).  The Recapitalization is expected to take
place effective on or about October 30, 2009.

The  terms  of the  Recapitalization  and  the  Series  C  Preferred  Stock  are
anticipated to include the following:

o        As an inducement to the Series B  Shareholders  to  participate  in the
         Recapitalization,  each participating Series B Shareholder will receive
         for each Series B Share one Series C Share,  plus 2000 shares of Common
         Stock of the Corporation.

o        The  Series  C  Shares  will  have the  same  priority  in the  capital
         structure of the Corporation as the Series B Shares, will have the same
         $1000 per share issue  price,  will have the same 8% dividend  rate and
         will carryover the accrued but unpaid dividends previously  accumulated
         on the Series B Shares exchanged therefor.

o        The Series C Shares will be convertible into shares of the common stock
         of the Corporation at the option of the holders thereof at a conversion
         price of $0.10  per  share,  which  contrasts  to the  $1.00  per share
         conversion price of the Series B Shares.

o        The Series C  Shareholders  will have no right of  redemption,  but the
         Corporation  will have the  option to redeem  the  Series C Shares at a
         price that  equals the sum of the issue  price,  plus all  accrued  but
         unpaid dividends.


Announcing  the   Recapitalization,   John  M.  Jacobs,  the  president  of  the
Corporation, said, "We have made a lot of progress this year, including securing
reinsurance for our subsidiary,  First Surety Corporation from Lloyds of London,
and issuing over 200 coal  reclamation  surety  bonds  totaling in excess of $35
million.  The overhang of our Series B Shares as a debt-like preferred stock has
been a concern for us. This  Recapitalization  will benefit the  Corporation and
will  benefit,  and  has  found  the  support  of,  over  60%  of our  Series  B
Shareholders.  This group includes some of the most loyal  supporters of what we
are working to accomplish - bringing cost  efficient and  environmentally  sound
coal reclamation surety bonding programs to the coal industry."

Jacobs Finanical Group is a Charleston,  West Virginia-based holding company for
First Surety  Corporation,  a West Virginia  domiciled  surety,  Triangle Surety
Agency,  an insurance agency that specializes in coal reclamation  surety bonds,
and Jacobs & Company, a registered investment advisor