Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Íslandsbanki sells commercial paper

Íslandsbanki  hf. has today sold 6 month commercial paper. The total issuance in
the  series cannot exceed ISK 1.5bn in nominal terms. The auction was structured
so  that bidders submitted bids at predetermined  rate (price), at a simple rate
of 5.95% (price: 97.0642).

Bids  for ISK  1.5bn were accepted.  Prior to  the auction the total outstanding
commercial paper amounted to ISK 7.54bn.

The commercial paper was sold to a broad group of investors. Trading is expected
to commence on 8 May 2014 on the Nasdaq OMX Iceland.

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#1782297]