Landsbanki Islands hf. and Straumur-Burdaras Investment Bank hf. settlement agreement

3 March 2009

Landsbanki Islands hf ("Landsbanki") and Straumur-Burdaras Investment
Bank hf ("Straumur") have today reached a settlement agreement on
their claims against each other, including money market lines, loans,
derivative positions, bonds and guarantees.

After netting off the respective claims, the net exposure of
Landsbanki to Straumur has been settled with a transfer of assets
from Straumur to Landsbanki. This agreement has no material impact on
Straumur's income statement and no effect on its cash position.
However, the agreement reduces Straumur's gross assets by
approximately EUR 200 million and improves its CAD ratio by nearly
2%. This agreement is consistent with Straumur's medium-term strategy
for reducing its balance sheet and overall risk levels.

For further information, contact
Georg Andersen
Senior Vice President, Head of Corporate Communications
Tel: +354 585 6707
georg@straumur.com