Landsvirkjun - Company Announcement

Landsvirkjun issues a 7 year bond

Today, Landsvirkjun signed a 7 year private placement amounting to USD 63.2
million. 

The bond was sold at a yield of 4.3 per cent, with annual interest payments and
one principal payment at maturity. The dealer for the transaction is Arctica
Finance hf. 

Alongside the bond issue, Landsvirkjun has reached an agreement with the
Landsbanki resolution committee to terminate an outstanding currency hedging
transaction for USD 3.2 million. This position has been accounted for in the
company's financial accounts from 2007. 

The proceeds will be used for general refinancing purposes and prefunding of
constructions in Northeast Iceland that are expected to begin next year. 



Reykjavik, September 6, 2011

For further information please contact Rafnar Larusson, CFO
at +354 515 9010 or by email: rafnar@lv.is

Attachments:

110906_Press release_Landsvirkjun issues a 7 year bond.pdf