Bonds issued by Ísafjarðarbær receive observation status

| Source: NASDAQ Iceland hf.

Bonds issued by Ísafjarðarbær (ISA 98 1) have received observation status with reference to an announcement made public by the issuer on May 22, 2014, concerning the early redemption of the bonds and request for their removal from trading.

The decision is based upon article 8.2 in the Rules for Issuers of Financial Instruments on NASDAQ OMX Iceland hf.