Íslandsbanki hf. - Company Announcement

Islandsbanki hf. : Covered bond tap issue

Íslandsbanki hf. has concluded an auction of non-indexed covered bonds. The
issue ISLA CB 19 was sold today for an amount of ISK 2.22bn at the nominal yield
of 6.90%.

All offers were accepted and following this latest issue, the total amount
issued in ISLA CB 19 has reached ISK 4.08bn. In total, Íslandsbanki has now
issued covered bonds amounting to ISK 44.79bn since its inaugural issue in
December 2011.

Trading is expected to commence on 30 September 2015 on Nasdaq Iceland. Market
making for all of Íslandsbanki's covered bond issues is in the hands of MP
Straumur.

For further information:

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


[HUG#1954450]