- Kaupthing Bank and NIBC determine not to proceed with the announced acquisition

| Source: Kaupþing banki hf. Kaupþing banki hf. 

Due to the current instability in the financial markets Kaupthing Bank and NIBC
have determined not to proceed with the announced acquisition of NIBC by
Kaupthing Bank. Relevant regulatory submissions have been withdrawn and the
share purchase agreement has been terminated. 

In light of this development, the proposed rights issue in Kaupthing Bank in
the first quarter of 2008 has also been cancelled. 

Further information:
Hreidar Már Sigurdsson, Group CEO, tel. + 354 444 6105.
Jónas Sigurgeirsson, Chief Communications Officer, tel. + 354 444 6112.