Moody s places Kaupthing Bank on review following the acquisition of NIBC

Moody's Investors Service has today placed on review for possible
downgrade the Aa3/C ratings of Kaupthing Bank hf ("Kaupthing")
following the announcement that it was to acquire the Dutch bank NIBC
Bank N.V. ("NIBC"). At the same time, Moody's has placed on review
for possible upgrade the Baa1 long term rating of NIBC.

The Bank's ratings for short-term obligations in local and foreign
currencies, P-1, which is the highest rating given by Moody's,
remains unchanged. NIBC's rating for short-term obligations in local
and foreign currencies, P-2, and the rating for financial strength,
C-, were confirmed with a stable outlook.

Moody's decision to place the ratings of Kaupthing on review for
possible downgrade reflects the weaker financial fundamentals of NIBC
and the execution risk involved in the proposed acquisition.
Importantly, Moody's notes that the troublesome sub-prime book would
not be sold to Kaupthing along with the NIBC, but would remain with
the vendor JC Flowers. Furthermore, the rating agency notes that the
two banks are a good strategic fit with complementary products and
that the acquisition of NIBC would further enhance Kaupthing's
geographical reach outside of its home market of Iceland.

Further information:
Gudni Adalsteinsson - Chief Treasurer, + 354 444-6126
Jónas Sigurgeirsson - Chief Communications Officer, +354 444-6112