MILESTONE REPORTS ISK 21.3 BILLION NET PROFIT FOR 2007 RESULTS FOR 2007 ● Net profit amounted to ISK 21.3 billion. ● Total revenues amounted to ISK 56 billion. ● Total assets amounted to ISK 392 billion at year end 2007. ● Annualized return on equity was 48.8%. ● Milestone's equity amounted to ISK 69.5 billion on 31 December 2007. ● The equity ratio of the Group was 18% and the parent company's equity ratio was 73%. ● At the end of the year assets under management within the Group amounted to ISK 379 billion. HIGHLIGHTS OF Q4 2007 ● Loss in fourth quarter amounted to ISK 5.8 billion. ● In the fourth quarter Milestone and subsidiaries acquired a 10.2% stake in the Nordic investment bank Carnegie, making the Milestone Group the largest shareholder in the bank. ● Subsequently, Anders Fällman, CEO of Milestone's Swedish subsidiary Invik, was appointed Chairman of the Board of Directors of Carnegie. ● In December Milestone finalized the acquisition of a 75.9% stake in KIB Bank in Macedonia. IMPORTANT EVENTS AFTER THE CLOSING DATE ● Pending FSA approval, the Board of Directors of Milestone has decided to transfer all Icelandic assets from Milestone to its wholly owned subsidiary Invik. ● The asset allocation effectively positions the Group as a Swedish financial group with Milestone as the only shareholder and Invik as the parent company of all subsidiaries, including eight majority owned financial institutions. KARL WERNERSSON, CHAIRMAN “In spite of challenging market conditions Milestone has stood its ground and is backed by a number of strong, majority owned subsidiaries in financial services. We have been affected by the adverse market trends but the basis for Milestone's operations remains robust. The result of 2007 reaffirms the resilience of Milestone and demonstrates our determination to further establish Milestone as a niche player on the Nordic financial market. By moving the Icelandic operations under the Swedish financial group Invik in 2008, the Group will be in a better position to take advantage of opportunities arising in the Nordic financial services market.” GUDMUNDUR OLASON, CEO “Milestone established a strong foothold in the Nordic countries in 2007 with the acquisition and integration of Invik. Our undivided focus is on growth and increased profitability within insurance, banking and asset management. We have built a flexible structure providing sustainable returns through profitable operations as the annual results for 2007 demonstrate and confirm. Milestone's operations primarily rest on assets outside of Iceland and therefore it's both a rational and a pragmatic step for Milestone to make preparations for future growth that will take place in Sweden and the rest of the Nordic countries. Under the new structure Milestone will be better positioned to manage and balance its investments and mitigate the currency exposure of its operations.” ABOUT MILESTONE Milestone is a Nordic financial group comprising majority owned financial institutions operating within the fields of insurance, banking and asset management. Milestone is monitored by the Icelandic FSA and eight of its subsidiaries are regulated by financial supervisory authorities in respective markets. Milestone's subsidiaries are amongst others the composite insurance companies Moderna and Sjóvá, the banks Banque Invik and Askar Capital as well as the asset management company Invik Funds. Information on Milestone can be found on: www.milestone.is OUTLOOK FOR 2008 Milestone expects investment returns to fluctuate with market trends but the operating companies of the Group are assumed to generate sustainable income and healthy profits from operations. Pending FSA approval, the Board of Directors of Milestone has decided to transfer all Icelandic assets from Milestone to its wholly owned subsidiary Invik. The asset allocation effectively positions the Group as a Swedish financial service group with Milestone as the only shareholder and Invik as the parent company of all subsidiaries, including eight majority owned financial institutions. Several dispositions of private equity investments and real estate investments are planned in the first half of 2008. Overall, the risk profile of the Group in regards to currency management and diversification of assets improved significantly in 2007 and the Group is in a better position to shoulder possible continuing downward market trends in 2008. Despite unfavorable stock market conditions Milestone is comfortable with its holdings in Glitnir Bank and Carnegie and has no intentions to reduce its holdings in the two banks. ADDITIONAL INFORMATION For additional information, visit www.milestone.is www.sjova.is www.invik.se www.askar.is Or contact Gudmundur Olason, CEO Tel: (+354) 414 1800