Landsbankinn hf. - Other information disclosed according to the rules of the Exchange

Landsbankinn hf. : Landsbankinn concludes market-making agreements for covered bonds

Landsbankinn  hf.  has  signed  market-making  agreements  with  Arion bank hf.,
Islandsbanki  hf. and Kvika hf. regarding  covered bonds issued by Landsbankinn.
The  covered  bonds  are  listed  on  NASDAQ  Iceland  and  the  market  makers'
obligations  in accordance with the agreement will become effective on 4 October
2017.

Prior  to market opening each business day, the market makers will place bid and
ask  orders for covered bonds issued by Landsbankinn. The minimum nominal amount
of  orders  in  benchmark  series,  and  series  previously defined as benchmark
series,  shall be ISK 80m or ISK 60m if the size of the series is lower than ISK
10bn. Benchmark  series are LBANK  CB 21, LBANK CBI  24 and LBANK CBI 28. Series
previously  defined as  benchmark series  are LBANK  CB 19 and LBANK CBI 22. The
minimum nominal amount of orders in other series is ISK 20m.

Individual  market makers  are released  from their  obligations on a particular
trading  day once  the trading  volume (specified  as "AUTO") of that particular
market  maker  totals  ISK  500m for  all  series  of  covered  bonds  issued by
Landsbankinn.

The  maximum spread between bid and ask orders is determined by time to maturity
on a given day, in accordance with the following table:

+---------------------------------+
| Time to maturity  Maximum spread|
+---------------------------------+
|   0 - 6 months     Unspecified  |
|                                 |
|6 months - 2 years     0.20%     |
|                                 |
|   2 - 4 years         0.30%     |
|                                 |
|   4 - 6 years         0.35%     |
|                                 |
|   6 - 9 years         0.60%     |
|                                 |
|   9 - 12 years        0.70%     |
|                                 |
|  12 - 18 years        1.00%     |
|                                 |
|18 years or longer     1.15%     |
+---------------------------------+


Inflation-linked  series that are prohibited from further issuance, according to
the  Central Bank  of Iceland's  rule no.  492/2001 on indexation of savings and
loans,  as subsequently amended, are  exempt from the aforementioned obligations
on maximum spread.

In  conjunction with the market-making agreements, Landsbankinn will provide the
market  makers with  bond lending  facilities under  which each market maker can
borrow  up to  320m in each  benchmark series,  and series previously defined as
benchmark series, and 80m in other series.


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