Net after-tax profit ISK 3.3 billion Return on equity (ROE) 11.5% Highlights from the year 2007: • Pre-tax profit of ISK 3.3 billion • Return on equity after-tax was 11.5% • Net interest income amounted to ISK 9.2 billion • Core earnings ISK 4.9 billion and pre-tax ROE 17.1% • Customer deposits 53% of loans to customers • Customer deposits increased by 51% from year end 2006 • Total assets amounted to ISK 224.2 billion at year end 2007, an increase of 22% from year end 2006 • Loans to customers amounted to ISK 161.6 million, an increase of 26% from year end 2006 • A solid loan portfolio - 60% of loan portfolio are loans to individuals and 80% of the portfolio are mortages • Equity at year end amounted to ISK 27.8 billion • The bank's capital adequacy ratio was 13.4% at year end. Tier 1 capital was 19.9% • Strong funding position - no refinancing of larger loans until september 2009 • SPRON converted into a public limited company and listed on OMX Nordic Exchange in October 2007 • 19.4% share in Icebank sold in November 2007 • Office opened in Berlin, Germany Gudmundur Hauksson CEO: “With a profit of ISK 3.3 billion the results for 2007 are satisfactory given the difficult circumstances in the financial markets. The Group's core business has improved and both interest and commission income have increased year on year. Customer deposits have increased by 51% and both SPRON´s commercial banking unit and Netbankinn, a wholly owned subsidiary, are financed entirely through deposits from customers. For the Group as a whole customer deposits represent 53% of loans to customers. The Group's liquidity position is strong and only one long-term loan will mature during the year, amounting to EUR 20 million, which we have already financed. The CAD ratio is 13.4% and a decrease in market value of our strategic holding in Exista has an insignificant effect on the ratio. During 2008 our focus is on streamlining the business after significant growth in recent years as well as decreasing costs and improving efficiency. We are therefore in a strong position to meet the adverse circumstances in the financial markets and take advantage of opportunities that may arise.”