Islandsbanki hf. : Íslandsbanki sells commercial paper

| Source: Íslandsbanki hf.
Íslandsbanki hf. has today sold 5 and 6 month commercial paper. The total
issuance in each series cannot exceed ISK 1.5bn in nominal terms. The auction
was structured so that bidders submitted bids at predetermined rates (prices).
The 5 month commercial paper was sold at a simple rate of 5.90% (price:
97.3670) and the 6 month commercial paper at a simple rate of 5.95% (price:

Bids  for ISK 260 million were accepted for the 5 month commercial paper and ISK
460 million  for the  6 month commercial  paper. Prior  to the auction the total
outstanding commercial paper amounted to ISK 6.92bn.

The commercial paper was sold to a broad group of investors. Trading is expected
to commence on 17 July 2014 on the Nasdaq OMX Iceland.

For further information:

  * Investor Relations - Tinna Molphy, and tel:
    +354 440 3187.
  * Media Relations - Dögg Hjaltalín, and tel:
    +354 440 3925.