Íslandsbanki hf. - Company Announcement

Íslandsbanki sells commercial paper

Íslandsbanki  hf.  has  today  offered  3, 5 and  6 month  commercial  paper  to
investors.  Offers of ISK 2.60bn were accepted  but the total appetite  amounted
to ISK 4.78bn.

Nominal  amount sold in series  ISLA 16 0212 was ISK 760m at  the simple rate of
6.25% (price  98.3271), sold in series  ISLA 16 0415 was ISK  720m at the simple
rate  of 6.49% (price 97.1794) and sold in series ISLA 16 0520 was ISK 1,120m at
the simple rate of 6.49% (price 96.5871).

Prior  to the  auction the  total outstanding  commercial paper  amounted to ISK
7.48bn. Trading is expected to commence on 6 November 2015 on Nasdaq Iceland.

For further information:

  * Investor Relations - Guðbjörg Birna Björnsdóttir, ir@islandsbanki.is and
    tel: +354 440 4752.
  * Public Relations - Edda Hermannsdóttir, pr@islandsbanki.is and tel:
    +354 440 4005.


[HUG#1962608]