Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : MP bank market maker for covered bond ISLA CBI 20

Íslandsbanki  hf. has selected MP  bank as market maker  for the Bank's ISLA CBI
20 covered bond.  The market maker is obligated to submit bid and ask offers for
at  least ISK 20m nominal  value, each day  before the market  opens. The market
maker  is required  to renew  its bid  and ask  offers within 15 minutes of them
being accepted. These are valid only within the trading day.  The maximum spread
between the market maker's bid and ask prices can be no higher than 0.8%.

If  trading in one business day reaches  ISK 60m nominal value, the market maker
may cease to present bids/offers until the next business day.

The market making is effective as of Monday 23 June 2014.

For further information:

  * Investor Relations - Tinna Molphy, tinna.molphy@islandsbanki.is and tel:
    +354 440 3187
  * Media Relations - Dögg Hjaltalín, dogg.hjaltalin@islandsbanki.is and tel:
    +354 440 3925


[HUG#1798092]