Meeting announcement Shareholders’ meeting

(This is a translation from the Icelandic announcement)

A shareholders’ meeting of Arion Bank hf., Id. No. 581008-0150, will be held at the Bank’s headquarters at Borgartun 19, 105 Reykjavik, at 16.00 Icelandic time on 5 September 2018. The meeting will be conducted in Icelandic, but translation services into English will be available.

Agenda:

Proposal to pay dividend to the Bank’s shareholders
Changes to the Board of Directors

Election of one new member to the Board of Directors to serve until the Bank’s next Annual General Meeting

The election of two members to serve on the Nomination Committee
Proposal on the remuneration to the members of the Nomination Committee
Proposal to amend the Articles of Association
It is proposed that the temporary provision of the Articles of Association which contains exemptions from certain provisions of the Articles on the time-frame for summoning of shareholders’ meetings will be erased. According to the provision, it became null and void when the Bank’s shares were admitted to trading on Nasdaq Iceland.
It is proposed that Addendum no 1 to the Articles of Association will be erased from the Articles of Association. The Addendum was added to the Articles of Association following a shareholders’ meeting held on 12 February 2018 and contains authorization for the Bank to purchase a certain amount of its own shares. The authorization was exercised in February 2018.

Other business

Explanatory notes to agenda items No 2 and 3:

Changes to the Board of Directors
The Board of Directors of Arion Bank has decided that an election of one new member to the Board of Directors shall take place at the shareholders’ meeting. The new member of the Board of Directors shall serve until the next Annual General Meeting and replace a member of the Board of Directors who resigned from his duty as a member of the Board of Directors before the end of his electoral period, cf. paragraph 2 of Article 64 of the Act No 2/1995 respecting Public Limited Companies. Individuals who intend to stand for election as a member of the Board of Directors must give notice of their candidacy in writing to the Board of Directors no later than five days prior to the commencement of the shareholders’ meeting, in accordance with the Articles of Association of the Bank. Notifications must be sent to shareholders@arionbanki.is by 16:00 Icelandic time on 31 August 2018. Notifications from candidates will be published on the Bank’s website www.arionbanki.is/gm no later than two days before the shareholders’ meeting and will be made available at the Bank’s headquarters from the same time.

The election of two members to serve on the Nomination Committee:
In accordance with the Bank’s Articles of Association and the Rules of Procedure for the Nomination Committee, the shareholders shall vote two of the three members of the Nomination Committee. The third member of the Nomination Committee shall be the chairman of the Board of Directors or another member of the Board of Directors appointed by the Board.

The individuals who intend to stand for election as members of the Nomination Committee must give notice of their candidacy in writing no later than five days prior to the commencement of the shareholders’ meeting. Notifications must be sent to shareholders@arionbanki.is by 16:00 Icelandic time on 31 August 2018. The applicable arrangement for voting of Board members in the Articles of Association shall apply to the voting of Committee Members. Notifications from candidates will be published on the Bank’s website www.arionbanki.is/gm no later than two days before the shareholders’ meeting and will be made available at the Bank’s headquarters from the same time.

General Information:
The final agenda, meeting announcement, proposals and other documents for the shareholders’ meeting can be found on the Bank’s website, www.arionbanki.is/gm, no later than 15 August 2018 and will be accessible at the Bank’s headquarters from the same time. An English translation of the meeting material will be accessible to shareholders at the Bank´s headquarters as well as on the Bank’s website www.arionbanki.is/gm. Should there be discrepancy between the English and the Icelandic version, the latter prevails.

Each shareholder is entitled to have a specific matter dealt with at the meeting if he so requests in writing or by electronic means no later than ten days prior to the shareholders’ meeting, no later than 16:00 Icelandic time, 26 August 2018. A rationale or a draft resolution shall be enclosed with such a request. The request shall be sent to the Board of Directors by an email to shareholders@arionbanki.is.

Each share of the Bank carries one vote except treasury shares. Notice is also drawn to a restriction of voting rights of certain shareholders of the Bank according to FME´s decisions dated 22 September 2017, see also communication by Arion Bank on the issue on 22 June 2018 on Nasdaq Iceland and Sweden.

Shareholders who do not intend to attend the shareholders’ meeting in person can vote on items on the agenda electronically. More detailed information on the electronical voting can be found on the Bank’s website www.arionbanki.is/gm. Special attention is drawn to the fact that it may take up to five working days to receive a password. Therefore shareholders are urged to apply for a password in a timely manner.

Shareholders may authorize a representative to attend shareholders’ meetings on their behalf and vote on their behalf. The representative shall submit a written or electronic dated power of attorney at the beginning of the meeting. A form of a power of attorney will be available on the Bank’s website.

Shareholders or the representatives of shareholders are asked to present themselves when arriving to the meeting (please bring ID).

Notice to holders of Swedish Depository Receipts (“SDRs”):
Holders of SDRs who wish to attend or vote by proxy at the shareholders’ meeting must:

be registered in the register kept by Euroclear Sweden AB (“Euroclear”) by 5:00 p.m. (CET) on 31 August 2018;
notify Skandinaviska Enskilda Banken AB (publ) (“SEB”) of their intention to attend the shareholders’ meeting no later than 12:00 noon (CET) on 31 August 2018; or
send an original signed proxy form to SEB so as to arrive at SEB no later than 12:00 noon (CET) on 31 August 2018.

Please note that requirement I. above must be fulfilled when the SDR holder chooses to attend the shareholders’ meeting as well as when the SDR holders chooses to vote by using the proxy form.

Requirement I: SDRs are only registered in the name of the SDR holder in the register kept by Euroclear. SDR holders registered in the name of a nominee must have their SDRs registered in their own names in the register at Euroclear to be entitled to attend and/or vote (by an authorized attorney or in person or by proxy form) at the shareholders’ meeting. SDR holders who hold the SDRs through a nominee must therefore request their nominee to make a temporary owner registration (so-called voting-right registration) in good time before the voting record date August 31, 2018 if they wish to attend and/or vote.

Requirement II: SDR holders who are directly registered in the register at Euroclear, or whose SDRs have been voting-right registered by 5:00 p.m. (CET) on 31 August 2018 and who wish to attend (by an authorized attorney or in person) at the shareholders’ meeting must notify SEB of their intention to attend the shareholders’ meeting no later than 31 August 2018 at 12:00 noon (CET).

Notice of the intention to attend the shareholders’ meeting should be made to SEB, by mailing to the address; SEB, Issuer Agent Department, AB3, SE-106 40 Stockholm, by e-mailing issuedepartment@seb.se, by phone +46-8-763 55 60 or by faxing +46-8-763 62 50. Please state your name, phone number, personal number and quantity.

Requirement III: SDR holders, who wish to instruct SEB to vote by proxy form, must send their original signed proxy forms by post or courier so as to arrive at SEB, Issuer Agent Department, AB3, SE-106 40 Stockholm, no later than 12:00 noon (CET) on 31 August 2018. Proxy forms will be available on the Bank’s website www.arionbanki.is/gm.

Temporarily restriction on transferring SDRs to shares
Due to the differences in record dates of shares and SDRs certain restrictions on transfers will take place. During the period from end of business on 29 August up to and including 7 September 2018 a conversion to or from SDRs and shares in Arion Bank hf. will not be permitted.

More detailed information regarding the meeting is available on the Bank’s website www.arionbanki.is/gm.

Reykjavik 14 August 2018
The Board of Directors of Arion Bank hf.

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Proposals to a Shareholders’ meeting of Arion Bank hf. to be held 5 September 2018

A shareholders’ meeting of Arion Bank hf. will be held at the Bank’s headquarters at Borgartun 19, 105 Reykjavik, at 16:00 Icelandic time on 5 September 2018. At the day of the announcement of the shareholders’ meeting there are 1.559.017.588 outstanding shares in the Bank with voting rights.

Agenda:

Proposal to pay dividend to the Bank’s shareholders
Changes to the Board of Directors

Election of one new member of the Board of Directors to serve until the Bank’s next annual general meeting

The election of two members to serve on the Nomination Committee
Proposal on the remuneration to the members of the Nomination Committee
Proposal to amend the Bank’s Articles of Association
Other business

Proposals of the Board of Directors

Item no 1, proposal to pay dividend to the Bank’s shareholders

The Board of Directors proposes that a dividend of 10,000,000,000.00 ISK will be paid to the Bank’s shareholders. The dividend will be equal to 5 ISK per share.

If approved by shareholders, the Bank’s shares traded on and after 6 September 2018 (Ex-date) will be ex-dividended.

The right to a dividend will be paid to shareholders registered in the Bank’s shareholders registry at the end of 7 September 2018 (Record date).

The payment date of the dividend will be 28 September 2018.

Explanatory note
At the Annual General Meeting of Arion Bank hf. 2018 the shareholders agreed that no dividend would be paid for the time being but noted that Arion Bank’s Board of Directors had the authority to propose that the Bank pay dividend or other disbursement of equity at an extraordinary shareholders’ meeting at a later stage, prior to the Annual Meeting of Arion Bank hf. 2019. Arion Bank’s CET1 ratio was at 23.1% on 30 June 2018. Dividend of ISK 10 bn. lowers the Arion Bank’s CET1 ratio to 21.8%, which is well above capital requirements.

Item no 4, proposal on the remuneration to the members of the Nomination Committee

It is proposed that members of the Nomination Committee, including the chairman of the Committee, will receive ISK 150.000 for each Committee meeting attended, up to maximum of ISK 150.000 in case of more than one meeting a month and maximum of ISK 900.000 per calendar year.

Explanatory note

The Annual General Meeting shall decide the remuneration of the Nomination Committee according to the Committee´s Rules of Procedure. As Nomination Committee had not been established at the time of the Annual General Meeting in March 2018 a decision on the remuneration was not taken.

Item no 5, proposals to amend the Bank’s Articles of Association

Proposals:

It is proposed that the Temporary provision of the Bank’s Articles of Association will be erased from the Articles of Association.

Explanatory note

The Temporary provision contains exemptions from provisions of the Bank’s Articles of Associations regarding the time-frame for summoning of shareholders´ meetings. According to the provision it became null and void when the Bank’s shares were admitted to trading on Nasdaq Iceland. It is therefore proposed that the Temporary provision will be erased from the Bank’s Articles of Association.

It is proposed that Addendum no 1 to the Bank’s Articles of Association will be erased from the Articles of Association.

Explanatory note

The Addendum was added to the Bank’s Articles of Association following a shareholders’ meeting held on 12 February 2018 and contains authorization for the Bank to purchase a certain amount of its own shares. The authorization was exercised in February 2018.

Explanatory notes to agenda items No 2 and 3

Changes to the Board of Directors of Arion Bank - Election of one new Board Director

The Board of Directors of Arion Bank has decided that an election of one new member to the Board of Directors shall take place at the shareholders’ meeting. The new member of the Board of Directors shall serve until the next annual general meeting and replace a member of the Board of Directors who resigned from his duty as a member of the Board of Directors before the end of his electoral period, cf. paragraph 2 of Article 64 of the Act No 2/1995 respecting Public Limited Companies. Individuals who intend to stand for election as a member of the Board of Directors must give notice of their candidacy in writing to the Board of Directors no later than five days prior to the commencement of the shareholders’ meeting, in accordance with the Bank’s Articles of Association. Notifications must be sent to shareholders@arionbanki.is by 16:00 Icelandic time on 31 August 2018. Notifications from candidates will be published on the Bank’s website www.arionbanki.is/gm no later than two days before the shareholders’ meeting and will be made available at the Bank’s headquarters from the same time.

The election of two members to serve on the Nomination Committee

In accordance with the Bank’s Articles of Association and the Rules of Procedure for the Nomination Committee, the shareholders shall vote two of the three members of the Nomination Committee. The third member of the Nomination Committee shall be the chairman of the Board of Directors or another member of the Board of Directors appointed by the Board.

Meeting announcement Shareholders’ meeting – Arion Bank hf.