Arion Bank hf. - Company Announcement

Arion Bank hf. covered bond tap issue

On Friday Arion Bank hf. concluded the sale of two inflation-linked covered
bonds listed on the Nasdaq Iceland. 

The inflation linked issue ARION CBI 21 was tapped for an amount of ISK
600,000,000 at a yield of 3.31% and the inflation linked issue ARION CBI 29 was
tapped for an amount of ISK 3,120,000,000 at a yield of 3.45%. 

Bond series are indexed to the CPI and have been admitted to trading on Nasdaq
Iceland. According to Arion Bank´s issuance schedule the next inflation linked
auction is in September. 

Covered bonds are used to finance Arion Bank‘s retail mortgage business. Arion
Bank currently offers inflation linked retail mortgages at 3.90% fixed interest
rate for five years and 3.85% variable interest rate. 



For further information please contact Haraldur Guðni Eiðsson of Arion Bank´s
Communications division, haraldur.eidsson@arionbanki.is, or tel. +354 444 7108.