1. Iceland Stock Exchange Icelandic Investment Abroad Thordur Fridjonsson, President and CEO of ICEX Sixth Consular Conference - 8 May 2006

2. Topics The Economy –Performance and prospects –Structural improvements –Strong fundamentals Iceland Stock Exchange –ICEX – NOREX Alliance –Size of the Icelandic securities market –Equity market capitalisation in relation to GDP –Exceptional growth - Remarkable price performance –Valuation on the equity market –Acquisitions abroad - International companies –Revenues generated abroad (ICEX 15) –New capital raised in the market –Reasons behind the success

3. Economic Growth – average annual GDP growth- Source: OECD

4. Containing inflation Setting the Funda- mentals EEA established The final phase of liberalising capital flows Incorporation of state owned banks and privatisation From budget deficit to surplus Inflation targeting- Independant Central Bank Final phase of privatisation of state owned banks The Phases of Economic and Financial Development Wave of acquisitions abroad

5. Iceland is doing well in International Comparisons Ranking Standard of living2 Competitiveness4 Creativity7 Low corruption1 Economic freedom5 Quotes:United Nations Human Development Index, Human Development Report 2005 The IMD World Competitiveness Yearbook 2005, IMD Switzerland 2005 The Flight of the Creative Class: The Global Creativity Index, Professor Richard Florida 2005 Transparency International: The International Corruption Perception Index 2005 The Heritage Foundation / Wall Street Journal: Index of Economic Freedom

6. Pension Fund Assets 1984-2005

7. Population over 65 per cent of working population USJapanEuropeIceland 1950128 8 197516122110 200518302513 202530503721 205033705027

8. External Position Per cent of GDP

9. Examples of Foreign Debt in a Few Countries Per cent of GDP Source: Jón Steinsson Mbl. 24.3.2006

10. NOREX Alliance Tallinn Helsinki Stockholm Copenhagen Vilnius Riga ICEX / VMF

11. Size of the Icelandic Securities Market Source: Central Bank of Iceland and ICEX Stocks: Market capitalisation - December 2005 Bonds: Market capitalisation - December 2005 GDP: Nominal 2005

12. Equity Market Capitalisation Per cent of GDP 2005

13. Exceptional Growth on ICEX

14. Top Performer

15. Valuation on the Icelandic Equity Market P/E ratios Source: Landsbanki Islands, Bloomberg

16. Number of Listed Companies & Average Market Value –Delistings mostly due to M&A activities –Companies more liquid and larger than 2-3 years ago * 27.02.2006

17. Acquisitions Abroad by Listed Companies on ICEX Source: Central Bank of Iceland and ICEX

18. Value of Acquisitions by Countries Source: ICEX

19. Revenues Generated Abroad (ICEX-15)

20. Listed Companies Division of Employees Between Iceland and Abroad Source: ICEX

21. New Capital Per cent of Market Value

22. International Investment - 1 Actavis Group:Balkanpharma, Pharmamed, FAKO, Zdravlje, Amide, Alpharmas human generic business, Higia AD, Sindan Alfesca:Labeyrie Group, Lyons Seafoods Atorka Group:Promens, Ilanta, NWF Group Plc. (16%), Romag (11%), Interbulk (23%), AMIAD Filtration System (10,9%) Avion Group:Excel Airways Group, Travel City Holdings Plc., Kosmar Holidays, Star Airlines, Star Europe, Xtra Airways, Aviation Services, Avia Services, Technical & Logistics Services, Shipping & Logistics, Innovate, Farmaleiðir, Faroe Ship, Heri Thomsen, Daalimpex, CTG, Halship, Euro Container Line, Harbor Grace, Dissaco GSS Airfreight NV, Traxx Intercontinental BV, Kirkenes Agency AS Bakkavor Group:Wine & Dine, Katsouris, Geest, Hitchen Foods, Creative Foods, New Primebake, Laurens Patisseries Dagsbrun:P/F Kall, 354 Media Scandinavia A/S, Wyndeham, Press Group Plc. Flaga Group:Sleep Tech, Medcorp.

23. International Investment - 2 FL GROUP:Sterling, Aktiv Kapital, Finnair, Royal Unibrew, Bang & Olufsen, Refresco Holding B.V. Glitnir Bank:Kredittbanken, BN Bank, Norse Securities, Union Group (51%) Icelandic Group: Seachill Ltd, Barogel S.A., Pickenpack–Hussman & Hahn Seafood, Saltur A/S, Dalian Three Star Ltd. Kaupthing Bank:FIH, JP Nordiska, Aragon, Sofi, Norvestia, Singer & Friedlander Kogun: Hands ASA Norway, Specialists in Custom Software Inc. Landsbanki Islands: Heritable Bank, Theather & Greenwood Holdings, Kepler Equities, Merrion Capital Group Ltd. Marel:Carnitech, TVM, CP Food Machinery, Geba, AEW Thurne, Delford Sortaweight Straumur Burdaras Investment Bank: Old Mutual Plc., Finnair Oyj., Cherryforetegen AB, Pricer AB, Polimoon TM:NEMI Forsikring, Invik & Co AB Ossur:Royce Medical Holdings, Innovation Sports Inc., Innovation Medical Products Holdings

24. ICEX-15 – End of April 2006 Market Cap EUR m. % of MV Kaupthing Bank6,76126.1% Glitnir banki hf.3,24612.5% Landsbanki Íslands hf.3,24612.5% Actavis Group hf.2,71710.5% Straumur-Burðarás Fjárfestingabanki hf.2,3449.0% FL GROUP hf.1,5956.1% Bakkavör Group hf.1,0634.1% Mosaic Fashions hf.6992.7% Össur hf.5642.2% Dagsbrún hf.3831.5% Alfesca hf.3071.2% Atorka Group hf.2711.0% Marel hf.2340.9% Kögun hf.1920.7% Flaga Group hf.360.1% ICEX-15 total 23,65891.2% Total MV of listed comp.25,954

25. Reasons Behind the Success Economic reforms during the last 10-15 years Liberalisation Privatisation Entrepreneurship and flexibility ICEX has played an important role Providing capital for expansion and restructuring

26. The Message The economy is fundamentally sound The market is well functioning From local to global Adjustments in wake of exceptional growth

27. Iceland Stock Exchange Laugavegur 182 IS-105 Reykjavik Iceland www.icex.is