Íbúðalánasjóður - Company Announcement

Organisational changes at the Housing Financing Fund (HFF) – New organisational chart

The Board of Directors approved a new organisational chart for HFF in its
meeting earlier this morning, Wednesday 25th of May 2016. After the
organisational changes, the operation of the HFF will be under two income
departments: Finance and Corporate, and one support department: Operations. The
Director of Finance will be Sigurður Jón Björnsson and the Director of
Corporate will be Guðrún Soffía Guðmundsdóttir. The position of the Director of
Operations will be advertised. 

The goal of the organisational changes is to adjust the HFF to a new
operational surrounding, increase its profitability and make it better equipped
to take care of its social role and increase its ability to serve its customers
and the public. The HFF´s role in the market for mortgage loans has changed the
last years as can be seen by the fact that during the years 2013 – 2015 only
about 10% of new mortgage loans were issued by HFF. The HFF´s share of mortgage
loans outside the capital area and to lower income families is on the other
hand higher. 

The organisational changes will have a positive effect on the operation of the
HFF and it is estimated that these changes will lead to operational costs being
around ISK 324 million lower when they have fully taken affect in 2017. They
will be in addition to other arrangements that have been introduced to increase
the profitability of the HFF as for instance the sales of properties, including
the sale of The Klettur Property Management ehf, reduction of operational costs
and increased yield of its liquid assets. As a result of all these measures
HFF´s long term forecasts predict that the HFF will show a positive balance and
that the Icelandic government will not have to subsidize HFF´s equity.