Landsbanki Islands hf. (Landsbanki) signs market making agreement with Kaupthing bank hf. (Kaupthing)

Landsbanki announced today that it has signed a market-making
agreement with Kaupthing, whereby Kaupthing will act as market maker
for shares issued by Landsbanki. This means that Kaupthing will
submit daily bid/ask offers for shares in Landsbanki through OMX
Nordic Exchange Iceland before the market opens each day on offers
that will only be valid within that day. The purpose of the agreement
is to facilitate trading and improve liquidity in Landsbanki's shares
on the OMX Nordic Exchange Iceland and to promote efficient and
transparent price formation.

The terms of the market making agreement are as follows:

- Kaupthing will submit daily bid and offer quotes for shares in
Landsbanki for a minimum of 1,000,000 shares at a price determined by
Kaupthing.
- Maximum bid/ask spread shall not exceed 1.0% and the deviation from
the last transaction price shall not exceed 3.0%
- The maximum obligated total trades per day is ISK 400,000,000
market value
- The agreement is effective as of 21 January 2008.

For further information:
Jónas Sigurgeirsson, Chief Communication Officer, tel 354-444-6112 or
ir@kaupthing.com

About Kaupthing Bank
Kaupthing Bank offers comprehensive commercial and investment banking
services to individuals, companies and institutional investors. The
Bank is a leading player in all the main areas of the Icelandic
financial market, and in addition to Iceland, the Bank's key markets
are Denmark and the United Kingdom. The Bank focuses on the growth
and development of its international activities and aims to be one of
the leading investment banks in northern Europe.

Kaupthing Bank operates in thirteen countries with its headquarters
located in Reykjavík. The Bank's main subsidiaries are FIH
Erhvervsbank in Denmark, Kaupthing Singer & Friedlander in the United
Kingdom, Kaupthing Bank Sverige, Kaupthing Bank Luxembourg, Kaupthing
Bank in Finland, Norvestia Oyj in Finland, Kaupthing New York,
Kaupthing Switzerland, Kaupthing Bank Belgium and Kaupthing
Bank Norge in Norway. The Bank also has activities in Isle of
Man, the United Arab Emirates (Dubai) and Qatar. As of 30 September
2007 the number of full-time equivalent positions was 3,190 at
Kaupthing Bank and its subsidiaries. www.kaupthing.com