Statement from the Minister of Finance

In accordance with the rules on capital contributions from the Treasury to savings banks, which were issued on December 17, 2008, the Ministry of Finance has already received applications from Sparisjódur Nordfjardar, Sparisjódur Keflavíkur, Sparisjódur Vestmannaeyja, Sparisjódur Svarfdæla, Sparisjódur Bolungarvíkur, and Byr.

The rules stipulate that the Financial Supervisory Authority and the Central Bank of Iceland shall prepare a statement on such applications. The aim is to expedite the processing of applications, in accordance with the following guiding principles:

• To diversify consumers’ financial services options to the extent possible
• To offer financial services throughout the country
• To streamline savings bank operations
• To safeguard the savings banks’ societal role

At this time, with the planned transfer of SPRON and Sparisjóda-bankinn’s operations to other financial institutions, it can be expected that the difficulties in the Icelandic financial market are coming to a close. The Government is convinced that, once applications from savings banks have been processed and Treasury loans for repurchase agreements finalised, further closures of Icelandic deposit money banks will not be necessary.