Islandsbanki hf




As Agent Bank, please be advised of the following rate determined on: 29-Nov-2007

Issue               : Islandsbanki hf - Series 186
                      USD 75,000,000.00 Step UP Callable FRN Due 02-Mar-2015
ISIN Number         : XS0213269094
Common Code/        : 21326909
144A ISIN
Issue Nomin     USD : 75,000,000.00
Period              : 03-Dec-2007 to 03-Mar-2008          Payment Date 03-Mar-2008
Number of Days      : 91
Rate                : 5.52375
Denomination USD    : 1,000.00                    75,000,000.00

Amount Payable
per Denomination    : 13.96             1,047,210.94

Bank of New York
Rate Fix Desk                           Telephone 44 1202 689580
Institutional Trust Services  Facsimille          44 1202 689601



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