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.