Merger schedule approved by the boards of directors of Kaupthing and SPRON



The boards of directors of Kaupthing Bank hf. ("Kaupthing") and the
Reykjavik Savings Bank hf. ("SPRON") have agreed on a merger
schedule, according to which Kaupthing will take over SPRON's assets
and liabilities by a merger. The merger will have an insignificant
impact on Kaupthing's total size on a consolidated basis.

Upon the merger, SPRON shareholders will receive a payment which is
equivalent to the market price of shares in SPRON at the close of
trading on 30 June 2008 plus a 15% premium. This equates to payment
of ISK 3.83 for each share in SPRON. The payment will be structured
as follows: 60% will be in the form of shares in Exista hf. and 40%
will be in the form of shares in Kaupthing.

In the opinion of the boards of directors of Kaupthing and SPRON, the
merger will have a positive impact on the operations of both
companies in Iceland. It will improve services and increase the
profitability of operations and value for the companies'
shareholders. The financial market unrest of the past months has
highlighted the need to place greater emphasis on improving operating
efficiency and reining in costs of financial companies. The
integration of Kaupthing and SPRON is a response to the changing
operating environment and will strengthen the operations of both
companies in the Icelandic financial market. Upon merging, emphasis
will be placed on maintaining the special status and market positions
of both companies. The branches of both banks will continue to
operate under their own brand names.

Conditions of the merger, SPRON shareholders' meeting and timing of
the merger

The merger is subject to the approval of a shareholders' meeting in
SPRON and the Icelandic Financial Supervisory Authority. The merger
is also subject to the competition authorities not rejecting it or
imposing conditions which the boards of directors of the companies
consider unacceptable or which would make it inevitable to resubmit
the merger proposal to a SPRON shareholders' meeting. The creditors'
approval of the merger has already been obtained. The SPRON
shareholders' meeting is scheduled for the beginning of August. The
opinion of an external financial company on the payment to be made
for the share capital in SPRON in the merger will be submitted at
that meeting.

The merged company will not assume the operations, assets and
liabilities, or the rights and obligations of SPRON until all the
conditions of the merger have been met.

Payment to SPRON shareholders

Upon the merger, shareholders in SPRON will receive 0.002007864
shares in Kaupthing Bank hf. and 0.305585106 shares in Exista hf. as
payment for each share of a nominal value of ISK 1 in SPRON.  No
payment will be made for SPRON own shares. SPRON shareholders will be
given the option of exchanging the said shares internally, through
Kaupthing's intermediation, free of commission for two weeks after
the settlement of the acquisition price, at the market price current
at that time. The price corresponds to the listed closing price of
Kaupthing and Exista shares on 30 June 2008, or ISK 763 for each
share in Kaupthing and ISK 7.52 for each share in Exista. The payment
to SPRON shareholders is equivalent to ISK 3.83 for each share in
SPRON and will be paid to SPRON shareholders once the conditions of
the merger have been met.

Kaupthing has made an agreement on the acquisition of 832,737,199
Exista shares from SPRON (340,965,708 shares), on the one hand, and
the Kista Investment Company (Kista-fjárfestingarfélag) (491,771,491
shares) on the other, which will be used as payment in the merger,
and the acquisition of these shares is subject to the same conditions
as the merger itself. The price of the shares in this transaction is
based on the above price, i.e. the listed closing price of Exista
shares on 30 June 2008, or ISK 7.52 for each share.

The merged company

There will be no changes to Kaupthing's articles of association
following the merger nor to its listing on the OMX Nordic Exchange in
Iceland or in Stockholm.  No new share capital will be issued by
Kaupthing in connection with this merger. The subsidiaries of SPRON
will become the subsidiaries of the merged company.

Company data as of 31 March 2008

Kaupþing:
Equity  ISK 416.9 billion
Total assets ISK 6,368.4 billion
Number of employees 3,324

SPRON:
Equity ISK 17.8 billion
Total assets ISK 254.7 billion
Number of employees 295


Key dates

- Merger schedule approved by the boards of directors of both
companies on 1 July 2008.
- SPRON's shareholders' meeting is scheduled for the beginning of
August.
- The merged company will assume the operations, assets and
liabilities, as well as the rights and obligations of SPRON once all
of the conditions of the merger have been met.

For further information please contact:
Ingólfur Helgason, CEO of Kaupthing in Iceland, tel. +354  444-6121
Gudmundur Hauksson, CEO of SPRON, tel. +354 550-1200
Jónas Sigurgeirsson, Chief Communications Officer, +354 444 6112 or
ir@kaupthing.com
Jóna Ann Pétursdóttir, Head of Public Relations at SPRON, tel. +354
840-8225 or ir@spron.is


About Kaupthing Bank
Kaupthing Bank is a northern European bank offering integrated
financial services to companies, institutional investors and
individuals. Kaupthing operates in fourteen countries, including all
of the Nordic countries, Luxembourg, Belgium, the United Kingdom and
the Isle of Man, Switzerland, Germany, the United States, the Dubai
International Financial Centre (DIFC) and the Qatar Financial Centre
(QFC). Kaupthing also has a retail banking operation in Iceland with
34 branches across the country. Its headquarters are in Reykjavík.
www.kaupthing.com

About SPRON
SPRON is a financial institution which offers retail and investment
banking services to individuals, businesses and professional
investors in the greater Reykjavik area. SPRON's main subsidiaries
are SPRON Securities, SPRON Factoring, Netbankinn and the Frjálsi
Investment Bank. SPRON operates seven branches in the capital area.

See PDF link to the merger documents below.

Pièces jointes

Merger documents.pdf