direct/ Islandsbanki (IS) - Islandsbanki acquires the brokerage firm Norse

Reykjavik/Oslo - November 24, 2005: Íslandsbanki hf., Reykjavik, has today signed a letter of intent to buy all shares in Norse Securities ASA and Norse Kapitalforvaltning AS, thereby acquiring a foothold in the Norwegian securities brokerage sector. "Entry into the securities market and the brokerage sector has been our stated goal since acquiring KredittBanken in 2004 and BNbank in 2005. Norse has an impressive customer base, strong management and talented staff, and is a key factor in establishing the group´s participation in the Norwegian capital market", commented Bjarni Ármannsson, CEO of Íslandsbanki.

The acquisition of Norse, and the further growth that Íslandsbanki seeks in related fields, will strengthen the bank in the areas of capital markets, structured products, corporate finance and real estate financing. "Creating profitable growth through targeted acquisitions in Norway is in good Íslandsbanki tradition. Íslandsbanki seeks further growth, and we plan to strengthen Norse in key areas, such as corporate finance. This is an area into which Norse aspires to expand, but has found it difficult to do without the strength of a bank as an owner", said Bjarni Ármannsson.

"Over a period of time, we have discussed how we could benefit from having a solid and well-reputed bank as new owners. With Íslandsbanki as our owner, this is now a reality", said Stig A. Rognstad, CEO and owner of Norse, who will stay on as CEO of the company he has led since 1995.

Íslandsbanki plans to maintain Norse as a separate unit, aiming to secure Norse´s core expertise, as Íslandsbanki has been able to do following its other acquisitions in Norway, namely of BNbank and KredittBanken. "Furthermore, we will contribute to growth through cooperation between Norse and Íslandsbanki´s operations in Copenhagen, London, Luxembourg, Oslo and Reykjavik", said Bjarni Ármannsson.

Íslandsbanki has defined Norway and Iceland as home markets, and the bank´s ambitions in the Norwegian market are high. "We will continue to strengthen our position in the Norwegian market. This is an important step on the way, but we will continue to coordinate our operations and look at new opportunities", said Frank O. Reite Head of ISB Norway.

Both sides to the sale have agreed not to disclose the price Íslandsbanki pays for Norse. The acquisition is subject to ordinary conditions, including required regulatory approval and satisfactory due diligence.

Press contacts:
Bjarni Ármannsson, Chief Executive Officer, CEO, Íslandsbanki, mobile +47-47 800 100
e-mail: bjarni.armannsson@isb.is,
Stig A. Rognstad, CEO, Norse, mobil +47-911 88 000, e-mail: stig.rognstad@norse-sec.no,
Bjørn Richard Johansen, International Communication and Public Affairs Director, Íslandsbanki,
e-mail: brj@isbnorway.no, mobile +47-47 800 100

A picure can be downloaded from the following link:
http://hugin.info/133924/R/1022755/161833.jpg

About Islandsbanki:
Islandsbanki (ISB) is a leading Iceland-based financial group that offers universal banking. The bank has an office in Denmark, a branch in London and is the sole owner of two banks in Norway (BNbank and KredittBanken) and one in Luxembourg. The company is listed on the Iceland Stock Exchange. Íslandsbanki has a market capitalization of approximately EUR 2.8 billion. Total assets at the end of September 2005 were EUR 17.7 billion. ISB recently announced record profits of EUR 244 million for the first three quarters of 2005, while ROE for the period was 34%.


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