- Straumur extends international reach to central and eastern Europe

Straumur (“Straumur” or the “Bank”) has acquired a 50% stake in Wood & Company,
the leading independent investment house in central and eastern Europe (“CEE”),
with the option of acquiring 100% no later than early 2011. The acquisition is
a demonstration of the Bank's determination to build a stronger international
presence, and to increase its fee and commission income by conducting a greater
proportion of client-driven business. 

The purchase is made subject to the approval of the Icelandic Financial
Supervisory Authority and the Czech Central Bank. The sale will be settled in
cash with a significant portion in Straumur stock. The price is not disclosed,
since the financial effects are insignificant. 

Wood & Company is owned by four partners who have all committed to continue to
run the company in partnership with Straumur. 

A major increase in client base and geographic reach
Wood & Company, which has its headquarters in the Czech capital, Prague, and a
presence in Slovakia and Poland, is the largest securities trading company on
the Prague Stock Exchange and a member of the Budapest, Warsaw, Bucharest and
Ljubljana Stock Exchanges, as well as the Wiener Börse and Deutsche Börse. In
2006, it executed trades worth US$24 billion, had a dominant share -
approximately 30% - of the market in Prague, and had a 6.6% market share across
the CE region. It has been awarded the Euromoney Award for Excellence eight
times, including for best local partner, best equity house and best domestic
securities house in The Czech Republic. 

Wood & Company's customers include domestic institutions across the region, as
well as the largest international institutional investors and investment banks
that are seeking access to these markets. In addition to offering securities
brokerage, including a greater breadth of research on CEE companies than any
other local broker, it offers corporate finance services including, for
example, flotation, capital markets' transactions, mergers and acquisitions,
fund raising and corporate advisory. In recent years it has also acted as an
adviser in many privatisations in the region, including those of the Czech
Republic's largest companies. 

Strong benefits for both parties
Through this partnership, Straumur will broaden its geographic base and
increase the proportion of net interest and fee and commission income, in
relation to its gross income. 

Straumur offers a complete range of investment banking services, including
brokerage, corporate finance advisory, and debt finance. Wood & Company
primarily derives its income from equities brokerage services (execution,
electronic trading and research) and commission for corporate finance
activities, which will make a significant addition to Straumur's existing
products and services. In addition, Straumur's clients will benefit from the
distribution power and network afforded by Wood & Company's significant
geographic footprint in CEE. 

Wood & Company will benefit from Straumur's strong balance sheet and integrated
business model, enabling it to build on its excellent growth, and increase the
range of services it offers its clients. 

William Fall, CEO of Straumur, commented:
“Wood & Company is exceptionally well positioned in this market and the
preferred provider of access to central and eastern Europe. This company has
been highly profitable for the past ten years and is a unique player in that
region. The acquisition is in line with our strategy of international growth.
Through this acquisition we will also enhance our fee and commission income
from investment banking services, which is another goal of the company. Coming
on the heels of the recent acquisition of eQ Bank in Finland, Wood & Company
strengthens Straumur's products, services and geographic access. Straumur now
offers greater client geographic access, additional products and services, and
a robust operating platform. These three components are at the core of our
overall strategy.” 

Jan Sýkora, Partner and Chairman of Wood & Company, commented:
“We are delighted to be entering into a partnership with Straumur, which we
believe will add considerable value for the existing customers, shareholders,
and employees of Wood & Company. Having access to an ambitious partner with a
strong balance sheet enables us to accelerate our development. We are very much
looking forward to expanding our geographic and product coverage by working
with Straumur and continuously improving our service to our clients.” 

Notes to Editors

About Straumur
Straumur is Iceland's largest investment bank. The Bank offers a complete range
of integrated investment banking services, including capital markets, corporate
finance, debt finance, and asset management services, and employs the
equivalent of 336 full-time members of staff. 

About Wood & Company
Wood & Company is a leading independent central and eastern European investment
banking house which offers a full range of equities brokerage services,
investment banking and corporate finance services. Its services includes
large-scale privatisations, initial public offerings, capital markets
transactions, mergers and acquisitions, fund raising and corporate advisory to
foreign corporate clients, and domestic issuers and institutions. Wood &
Company, which has its headquarters in Prague and presence in Slovakia and
Poland, has a staff of 70 and is a member of the Prague, Vienna, Frankfurt,
Warsaw, Bucharest, Ljubljana, and Budapest Stock Exchanges. 


For further information, please contact Johanna Vigdis Gudmundsdottir, Director
of Corporate Communications, tel: +354 840 9133, johanna@straumur.net