Arion Bank hf. - Company Announcement

Arion Bank will prepay $237 million of notes

On 7 December Arion Bank will prepay $237,120,000 of notes in addition to
accrued interest. The notes amounted to $747,481,000 when they were issued at
the beginning of the year. 

This is in addition to the payment made in May of $252,697,000. Following these
payments $257,664,000 remain outstanding on these notes. The notes are held by
Kaupthing and were issued as part of the arrangements for the liberalization of
capital controls in Iceland. 

The prepayment is in accordance with the terms and conditions of the notes,
which state that Arion Bank shall make a prepayment in the event of any further
issuance by the Bank, such as the one that took place on 1 December 2016 when
the Bank issued €300 million in senior unsecured bonds. 

For further information please contact Haraldur Gudni Eidsson of Arion Bank's
Communications division at haraldur.eidsson@arionbanki.is, or tel. +354 444
7108.