In the press recently, there have been doubts expressed as to whether it was legal to grant Straumur-Burdarás Investment Bank hf. (Straumur) permission to carry out its accounting and prepare its annual financial statements in euros. That being the case, the Bank considers it necessary to make the following comments: According to the Act on Financial Statements, it is the Register of Annual Accounts that grants corporations permission to carry out their accounting in foreign currency. In a letter dated 31 October 2006, Straumur applied to the Register of Annual Accounts for such permission. The request was supported, among other things, with the rationale that Straumur invested substantially in foreign investment instruments and undertakings, and the corresponding debt was in foreign currency. Permission was granted with a letter from the Register of Annual Accounts, dated 5 December 2006. That letter states, among other things, that the Bank meets the requirements set forth in Article 8 of the Act on Financial Statements. On the basis of that permission, Straumur's Board of Directors decided, at a meeting held in December 2006, to carry out its accounting and prepare its annual financial statements in euros effective 1 January 2007. The statements above make it clear that Straumur has complied with statutory law in all respects with regard to its decision to carry out its accounting and prepare its financial statements in euros. Even though there may be divided opinion in the government about the interpretation of the Act on Financial Statements and the administration of the Register of Annual Accounts, Straumur cannot be faulted. The dispute that has arisen is utterly unconnected to the Bank, as the decision by the Register of Annual Accounts is advantageous and will not be revoked. We must therefore request that the government keep Straumur's name out of public discussion of this subject in the future. Further information can be obtained from Jóhanna Vigdís Gudmundsdóttir, Director of Corporate Communications, mobile number 840 9133.