Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Íslandsbanki sells commercial paper

Íslandsbanki  hf.  has  today  offered  3, 5 and  6 month  commercial  paper  to
investors.  The total issuance in each series cannot exceed ISK 1.5bn in nominal
terms.  Offers of  ISK 360m were  accepted. Nominal  amount sold  in series ISLA
15 1106 was  ISK 180m at  the simple  rate of  6.05% (price 98.5916) and sold in
series ISLA 16 0212 was ISK 180m at the simple rate of 6.25% (price 96.9207).

Prior  to the  auction the  total outstanding  commercial paper  amounted to ISK
3.0bn. Total appetite for the issue amounted to ISK 980m. Trading is expected to
commence  on 13 August 2015 on Nasdaq Iceland, shortnames; ISLA 15 1106 and ISLA
16 0212.

For further information:

  * Investor Relations - Guðbjörg Birna Björnsdóttir, ir@islandsbanki.is and
    tel: +354 440 4752.
  * Media Relations - Edda Hermannsdóttir, pr@islandsbanki.is and tel:
    +354 440 4005.


[HUG#1944215]