Lánamál ríkisins - Company Announcement

Capital contributions from the Treasury to the Housing Financing Fund and the savings banks

It has been established that the Housing Financing Fund (HFF) will require a
capital injection from the Treasury to strengthen its capital position. An
assessment of the Fund's financial need is underway. Also in progress is the
financial restructuring of the savings banks. It is expected that their
financial need will be in line with previous estimates. The authorities aim to
complete these tasks by the end of the current calendar year. 

The financing will be carried out in a manner comparable to that used for other
financial institutions in 2009. This will not affect the previously announced
schedule for issuance of benchmark Treasury bonds in 2010.