On Wednesday, 10 December at 14:00 the Central Bank of Iceland on behalf of the Treasury will conduct an auction of non-indexed Treasury Notes. This is a new series of Treasury Notes, RIKB 10 1210, with an annual coupon of 13.75% and a final maturity date on December 10, 2010. The Central Bank reserves the right to accept all of the submitted bids, part of them or reject all of them. Only primary dealers in Treasury securities are authorised to submit bids in this auction. They also submit bids on behalf of investors. The minimum amount of each bid is 1 m.kr. nominal value. The auction will be structured as a Dutch auction, which means that all accepted bids will be offered to primary dealers at the same price. The lowest accepted price will determine the selling price. In other respects, reference is made to the Terms of Invitation to Tender, which accompany this press release. The payment and settlement date is Friday, December 12, 2008, that is the same date as the redemption date of RIKB 08 1212. For this auction, the Central Bank requests bids for the following series: Series RIKB 10 1210 Maturity date Dec. 10, 2010 Outstanding amount 0 m.kr. Time to maturity 2.0 years After the results of the auction are available, the Central Bank will offer primary dealers the equivalent of 10% of the nominal value sold in the auction, at the price of accepted bids, until 14:00 on the settlement date of the auction. Each primary dealer that has submitted an accepted bid in the auction has the right to purchase an amount proportional to its total purchase. The payment and settlement date for these transactions is one day after the transaction date (T+1). Further information can be obtained from Bjorgvin Sighvatsson, International and Market Department, Central Bank of Iceland, at +354 569 9633.