Icebank's expansion strategy pays dividends: Total assets more than doubled over the year - Net interest income increased by 66% from last year Icebank's business activities in the third quarter were characterised by strong growth, as the Bank continued to strengthen its position, particularly in business with other financial institutions. Even though the third quarter returned only ISK 65 million in profit after taxes, profit after taxes in the first nine months amounted to ISK 4,263 million, and return on equity was 47.3%. This year, the Bank is for the first time publishing quarterly statements that have been reviewed by the Bank's auditors; however, the comparison figures for last year are unaudited. The statements are prepared in accordance with International Financial Reporting Standards (IFRS). Third quarter of 2007 • Profit after taxes amounted to ISK 65 million in the third quarter, as compared to ISK 2,399 million in the second quarter. • Earnings per share fell as compared to the second quarter, from ISK 2.10 to ISK 0.06. • Total assets grew by more than ISK 80 billion over the quarter, or 68.7%. The growth is primarily a result of increased lending and claims against financial institutions, as well as derivatives contracts with customers. • Personnel grew by 10% over the third quarter, with 88 positions in the Bank at the end of the quarter. First nine months of 2007 • Profit amounted to ISK 4,263 million after taxes in the first nine months of the year, as compared to ISK 6,195 million in the preceding year. • Net interest income increased by 66% between years, while profit from the Bank's securities portfolio fell by just short of 50%. The biggest factor was the fluctuation in the value of the Bank's holdings in Exista. • Earnings per share amounted to ISK 4.22, as compared to ISK 9.43 for the corresponding period last year. • Return on equity was 47.3%, as compared to 94.9% in 2006. • The cost-income ratio was 14.2%, compared to 7.1% for the corresponding period of 2006. • The interest rate margin increased from 1.9% last year to the current level of 2.0%. • The Bank's staff has grown in size by 26% over the year, to 88 employees at the end of the period. The increase is spread over all the Bank's divisions. Finnur Sveinbjörnsson, CEO: “Icebank has markedly strengthened its position in its business with financial institutions over the quarter, building on its experience of the last 20 years as a service and central bank for the savings banks. This is manifested in the rapid growth in the Bank's total assets, which passed the ISK 200 billion mark at the end of the quarter, having more than doubled since the start of the year. It is primarily the interest-bearing assets that are growing, and for this reason the Bank's net interest income has grown substantially. Curremtly, net interest income is almost twice the amount of the Bank's entire operating cost. This is unique among Icelandic financial institutions, and even overseas. This places the Bank in a better position to meet any adverse winds in the securities markets, as in fact was the case in the third quarter. The Bank recently announced its acquisition of Behrens Corporate Finance as well as its first steps in opening the ownership of the Bank. We are looking forward to an exciting time of continued growth.” For further information, please contact: Finnur Sveinbjörnsson, CEO, finnur@icebank.is, tel. +354 540 4000. Hafdís Karlsdóttir, Managing Director, Operations, hafdis@icebank.is, tel. 354 540 4000. The financial statements in their entirety can be accessed at www.icebank.is.