Kaupthing Bank s Results for the First Half of 2007

Net earnings of ISK 46.8 billion (EUR 533 million)

- Shareholders' net earnings increased by 43.8% to ISK 45.8 billion
in 1H
- Return on equity in first half of 32.0% on an annualised basis.
Earnings per share of ISK 62.2 during the first half - compared with
ISK 47.9 in same period of 2006
- Shareholders' net earnings in Q2 up 95.5% to ISK 25.5 billion (EUR
294.7 million)
- Operating income in Q2 increased by 66.8% to ISK 51.8 billion
- Net interest income in Q2 up by 38.0% to ISK 19.8 billion
- Net fee and commission income in Q2 grew by 65.4% to ISK 15.2
billion
- Operating expenses in Q2 rose by 28.5% to ISK 19.0 billion
- Cost/income ratio in Q2 was 36.7%
- Kaupthing Bank booked ISK 4.3 billion profit from the sale of its
subsidiary Eik fasteignafélag hf. during Q2
- Total assets of ISK 4,570.4 billion (EUR 54.3 billion) at the end
of June 2007, increasing by 23.3% at a fixed exchange rate from the
beginning of the year and by 12.7% in ISK

Hreidar Már Sigurdsson, CEO"Kaupthing Bank went from strength to strength during the second
quarter and all the Bank's main offices produced solid results. The
vigorous growth of fee and commission income and net interest income
was a key feature of the second quarter. The increase in deposits at
the Bank is a source of particular satisfaction, and deposits now
represent 46% of loans to customers. We have put considerable effort
into building our businesses in the UK, and we have seen a complete
turnaround at Kaupthing Singer & Friedlander. The performance of all
our main business segments has exceeded our expectations. The Bank's
pipeline is robust and the outlook for the rest of the year is
positive."
Further information
For further information on the results please contact Jónas
Sigurgeirsson, Chief Communications Officer on +354 444 6112 or Ólöf
Hildur Pálsdóttir, Deputy Head of Investor Relations, on +354 444
6569 (ir@kaupthing.net). Information on Kaupthing Bank is also
available on the Bank's website www.kaupthing.com

About Kaupthing Bank
Kaupthing Bank is a northern European bank offering integrated
financial services to companies, institutional investors and
individuals. These services include corporate banking, investment
banking, capital markets services, asset management and comprehensive
wealth management for private banking clients. The Bank operates in
ten countries, including all the Nordic countries, Luxembourg,
Switzerland, the UK and the US. In addition the Bank operates a
retail franchise in Iceland, where it is headquartered.

Kaupthing Bank is currently among the seven largest banks in the
Nordic region in terms of market capitalization. Through sound
organic growth and strategic acquisitions like the UK bank Singer &
Friedlander in 2005 and FIH Erhvervsbank in Denmark in 2004,
Kaupthing Bank has fortified its position to provide outstanding
services to its client base in the UK, the Nordic countries and
elsewhere in northern Europe. The Bank has 2,970 employees and total
assets of EUR 54.3 billion (as of 30 June 2007).