Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Covered bond issues

Íslandsbanki hf. has concluded an auction of two CPI-linked covered bonds. The
CPI-linked issue ISLA CBI 20 was tapped for an amount of ISK 380m at a real
yield of 3.25%. A new eleven-year CPI-linked issue, ISLA CBI 26, was sold today
for an amount of ISK 2,360m at a real yield of 3.40%.

Following these latest issues, the total amount issued in ISLA CBI 20 has
reached ISK 3.20bn. In total, Íslandsbanki has now issued covered bonds
amounting to ISK 36.55bn since its inaugural issue in December 2011.

Total appetite for the tap issue amounted to ISK 4.32bn, of which 63% of the
offers were accepted. Trading is expected to commence on 7 May 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 - Guðný Helga Herbertsdóttir, pr@islandsbanki.is and tel:
    +354 844 3678.


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