Kaupthing Bank has secured sufficient funds to pay back the large majority of German Kaupthing EDGE deposits

In light of the interview  with Olafur Ragnar Grimsson, President  of
Iceland, in  the  Financial  Times  Deutschland  earlier  today,  the
Resolution Committee of  Kaupthing Bank hf.  would like to  reiterate
the announcement it made at the  creditors' meeting of the Bank  last
week. In addition, the Resolution Committee would like to stress that
payments to depositors will be made out of the funds of the Bank  and
therefore, payments  will  not  require funding  from  the  Icelandic
Government.

The Resolution Committee  is committed  to paying  back all  priority
claims as  quickly  as possible,  and  it has  therefore  since  last
October placed great importance on settling the claims of the  30,000
depositors in  Germany  and  has put  forward  several  proposals  to
achieve this aim. As the Bank has now secured sufficient funds it  is
possible to  pay back  the large  majority of  the German  deposits.
However, EUR 55 million have been seized by DZ Bank and therefore  it
is not possible to pay deposits back in full at this stage. It is the
opinion of the Resolution  Committee that these  funds belong to  the
German Kaupthing EDGE depositors and hence, they will be used to  pay
back depositors as soon as the funds have been released by DZ Bank.

The Bank wishes to start making the payments as quickly as  possible.
A    meeting     between     the     Resolution     Committee     and
Entschädigungseinrichtung, which is a subsidiary of the Bundesverband
deutscher Banken e.  V., is  scheduled today to  discuss this  matter
further. Another press release will be made once the plan is ready.