Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Covered bond issues

Íslandsbanki hf. has concluded an auction of two CPI-linked covered bonds. A new
CPI-linked issue, ISLA CBI 22, was sold today for an amount of ISK 1.080m at a
real yield of 3.00%. The CPI-linked issue ISLA CBI 26 was tapped for an amount
of ISK 2.140m at a real yield of 3.05%.

 Following these latest issues, the total amount issued in ISLA CBI 26 has
reached ISK 6.38bn. In total, Íslandsbanki has now issued covered bonds
amounting to ISK 42.57bn since its inaugural issue in December 2011.

 Total appetite for the issue amounted to ISK 5.9bn, of which 55% of the offers
were accepted. Trading is expected to commence on 4 September 2015 on Nasdaq
Iceland. Market making for all of Íslandsbanki's covered bond issues is in the
hands of MP bank.

 For further information:

Investor Relations - Guðbjörg Birna Björnsdóttir, ir@islandsbanki.is and tel:
+354 440 4752.

Media Relations - Már Másson, mar.masson@islandsbanki.is and tel +354 440 4990. 

[HUG#1948077]