Íslandsbanki hf. - Company Announcement

Islandsbanki hf. sells commercial paper

Íslandsbanki  hf. has today offered 3 and 6 month commercial paper to investors.
Offers  of  ISK  2,560m were  accepted  but  the  total appetite amounted to ISK
5,580m.

Nominal  amount sold in series ISLA 16 0815 was ISK 1,900m at the simple rate of
6.39% and  the nominal  amount sold  in series  ISLA 16 1124 was ISK 660m at the
simple rate of 6.45%.

Prior  to the  auction the  total outstanding  commercial paper  amounted to ISK
10.6bn. Trading  is expected to  commence on 20 May  2016 on Nasdaq Iceland when
ISK 2,560m of ISLA 16 0520 is on maturity.

For further information:

  * Investor Relations - Tinna Molphy, ir@islandsbanki.is and tel: +354
    440 3187.
  * Public Relations - Edda Hermannsdóttir, pr@islandsbanki.is and tel:
    +354 440 4005.


[HUG#2012415]