Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Íslandsbanki sells commercial paper

Íslandsbanki  hf.  has  today  sold  5 and  6 month  commercial paper. The total
issuance  in each series  cannot exceed ISK  1.5bn in nominal terms. The auction
was  structured so that bidders submitted  bids at predetermined rates (prices).
The  5 month commercial paper at a simple rate of 6.00% (price: 97.5134) and the
6 month commercial paper at a simple rate of 6.05% (price: 97.0005).

Bids for ISK 1.4bn were accepted for the 5 month commercial paper and ISK 1.3bn
for  the 6 month  commercial paper.  Prior to  the auction the total outstanding
commercial paper amounted to ISK 6.85bn.

The commercial paper was sold to a broad group of investors. Trading is expected
to commence on 20 March 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#1768686]