EKF 11% Enhanced Yield Securities Linked TO The Claymore Yieldstream 20

 

UPDATED CALCULATION OF REGISTRATION FEE

 

 

Filed pursuant to Rule 424(b)(3)

Registration Statement No. 333-140456

Subject to completion dated April 16, 2008.

 

PRELIMINARY PRICING SUPPLEMENT NO. 199 dated [ • ]

to Prospectus Supplement and Prospectus dated February 5, 2007

relating to the Eksportfinans ASA U.S. Medium-Term Note Program

 

 

100% Principal Protected Commodity-Linked Notes due [ • ]

 

This document is a pricing supplement. This pricing supplement provides specific pricing information in connection with this issuance of notes. Prospective investors should read this pricing supplement together with the prospectus supplement and prospectus dated February 5, 2007 for a description of the specific terms and conditions of the particular issuance of notes. This pricing supplement amends and supersedes the accompanying prospectus supplement and prospectus to the extent that the information provided in this pricing supplement is different from the terms set forth in the prospectus supplement or the prospectus.

 

 

For a detailed description of the terms of the notes, see “Summary Information” beginning on page P-1 and “Specific Terms of the Notes” beginning on page P-15. Defined terms used in this cover page are defined in “Specific Terms of the Notes”.

 

Investing in the notes involves risks. See “Risk Factors” beginning on page P-9.

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these notes or passed upon the adequacy or accuracy of this pricing supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.

 

Capitalized terms used in this pricing supplement without definition have the meanings given to them in the prospectus supplement and accompanying prospectus.

 

 

 

Wachovia Securities

 

 

SUMMARY INFORMATION

 

This summary includes questions and answers that highlight selected information from this pricing supplement and the accompanying prospectus supplement and prospectus to help you understand the 100% Principal Protected Commodity-Linked Notes, due [ • ], which we refer to as the notes . You should carefully read this pricing supplement and the accompanying prospectus supplement and prospectus to fully understand the terms of the notes as well as the tax and other considerations that are important to you in making a decision about whether to invest in the notes. You should carefully review the sections entitled “Risk Factors” in this pricing supplement and the accompanying prospectus supplement and prospectus, which highlight certain risks associated with an investment in the notes, to determine whether an investment in the notes is appropriate for you. Defined terms used in this section and not defined herein are defined in “Specific Terms of the Notes”.

 

Unless otherwise mentioned or unless the context requires otherwise, all references in this pricing supplement to “Eksportfinans”, “we”, “us” and “our” or similar references mean Eksportfinans ASA and its subsidiaries.

 

What are the notes?

 

The notes offered by this pricing supplement will be issued by Eksportfinans and will mature on [ • ], a date that is approximately five years following the original issue date (to be determined on the trade date). The maturity payment amount will be linked to the performance of the basket, which is in turn based on the performance of the basket components. The notes will not bear interest and no other payments will be made until maturity.

 

Each basket component will represent 1/6 of the basket. The basket components are set forth below:

 

 

The weighting of each basket component is fixed and will not change during the term of the notes. Similarly, the basket components will not change, except as described under “Specific Terms of the Notes — Adjustments to the Basket Components” on page P-19.

 

As discussed in the accompanying prospectus supplement, the notes are debt securities and are part of a series of debt securities entitled “Medium-Term Notes” that Eksportfinans may issue from time to time. The notes will rank equally with all other unsecured and unsubordinated debt of Eksportfinans. For more details, see “Specific Terms of the Notes” beginning on page P-15.

 

Each note will have a principal amount of $1,000.00. Each note will be offered at an initial public offering price of $1,000.00. You may transfer only whole notes. Eksportfinans will issue the notes in the form of a global certificate, which will be held by The Depository Trust Company, also known as DTC, or its nominee. Direct and indirect participants in DTC will record your ownership of the notes.

 

Are the notes principal protected?

 

The notes are fully principal protected and we will pay a minimum of 100.00% of the principal amount of your notes at maturity, subject to our ability to pay our obligations.

 

What will I receive upon maturity of the notes?

 

On the maturity date, for each note you own, you will receive a cash payment equal to the maturity payment amount. The maturity payment amount to which you will be entitled depends on the basket return (as defined below).

The maturity payment amount will equal the sum of the principal amount of the note and the basket performance amount, if any.

 

Determination of the basket performance amount

 

The basket performance amount per note will be determined by the calculation agent and will equal the greater of (i) $0.00; or (ii) the product of the principal amount of $1,000.00, the basket return and a participation rate of between 100.00% and 105.00% (to be determined on the trade date).

 

Determination of the basket return

 

The basket return per note will be determined by the calculation agent and will equal:

 

$1,000.00 x		(		final basket level−initial basket level initial basket level		)

 

The initial basket level is 1,000.00.

 

The final basket level will be determined by the calculation agent and will equal the closing level of the basket on the valuation date. The closing level of the basket will be calculated based on the weighted levels of the basket components (as shown in the table below), and will equal the sum of the products of (i) the component multiplier of each basket component and (ii) the closing price of the basket component on the valuation date.

 

 

The participation rate will equal between 100.00% and 105.00% (to be determined on the trade date).

 

The component multiplier with respect to each basket component will equal the quotient of (i) the basket weight of each basket component multiplied by the initial basket level, divided by (ii) the closing price of each basket component on the trade date.

 

The closing price for each basket component on any given date will be determined by the calculation agent by reference to its official closing price or cash settlement price for that basket component on the relevant exchange or market, as follows:

 

 

 

An exchange means:

 

(a) with respect to the component commodities, the primary organized exchange or quotation system for trading any component commodity and any successor to any exchange or quotation system or any substitute exchange or quotation system to which trading in any component commodity has temporarily relocated (provided that the calculation agent has determined that there is comparable liquidity relative to the component commodity on the substitute exchange or quotation system as on the original exchange), and

 

(b) with respect to the component indices, the primary organized exchange or quotation system for trading derivative instruments related to the component indices and any successor to any exchange or quotation system or any substitute exchange or quotation system to which trading in the commodity and related derivative instruments underlying the component indices has temporarily relocated (provided that the calculation agent has determined that there is comparable liquidity relative to the commodities underlying the component indices on such substitute exchange or quotation system as on the original exchange).

 

A related exchange means each exchange or quotation system on which futures or options contracts relating to the component indices are traded, any successor to such exchange or quotation system or any substitute exchange or quotation system to which any such trading has temporarily relocated (provided that the calculation agent has determined that there is comparable liquidity relative to the futures or options contracts relating to the component indices on such temporary substitute exchange or quotation system as on the original related exchange).

 

The valuation date , with respect to each basket component, means the tenth business day before the maturity date. However, if that day occurs on a day that is a disrupted day or that is not a trading day with respect to one or both basket components, then the valuation date for the affected basket component or basket components will be postponed until the next succeeding trading day that is not a disrupted day for those basket components; provided that in no event will the valuation date with respect to either basket component be postponed by more than ten trading days. The determination of the closing price for either basket component with respect to which the valuation date is a trading day and is not a disrupted date will not be postponed for the purpose of calculating the maturity payment amount. If the valuation date is postponed to the last possible day but that day is a disrupted day, that date will nevertheless be the valuation date. If the valuation date is postponed, then the maturity date of the notes will be postponed by an equal number of trading days.

 

A business day means a day that is a Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in New York City generally are authorized or obligated by law, regulation or executive order to close.

 

A trading day means any day on which each exchange is scheduled to be open for its respective regular trading sessions.

 

Hypothetical Examples

 

Set forth below are three hypothetical examples of the calculation of the maturity payment amount. These examples assume a hypothetical participation rate of 102.50%. The actual participation rate will be determined on the trade date.

 

Example 1 —

 

The hypothetical basket return is 50.00%, reflecting a 50.00% increase in the value of the basket:

 

Basket performance amount (per note) is the greater of:

 

(i) $0.00, or

 

(ii) ($1,000.00 x 50.00% x 102.50%) = $512.50.

Maturity payment amount = $1,000.00 + $512.50 = $1,512.50.

 

Since the hypothetical basket return is greater than zero, the basket performance amount would equal $512.50 and the maturity payment amount would be greater than the principal amount of your note.

 

Example 2 —

 

The hypothetical basket return is 10.00%, reflecting a 10.00% increase in the value of the basket:

 

Basket performance amount (per note) is the greater of:

 

(i) $0.00, or

 

(ii) ($1,000.00 x 10.00% x 102.50%) = $102.50.

 

Maturity payment amount = $1,000.00 + $102.50 = $1,102.50.

 

Since the hypothetical basket return is greater than zero, the basket performance amount would equal $102.50 and the maturity payment amount would be greater than the principal amount of your note.

 

Example 3 —

 

The hypothetical basket return is 0.00%, reflecting no change in the value of the basket:

 

Basket performance amount (per note) is the greater of:

 

(i) $0.00, or

 

(ii) ($1,000.00 x 0.00% x 102.50%) = $0.00.

 

Maturity payment amount = $1,000.00 + $0.00 = $1,000.00.

 

Since the hypothetical basket return is less than zero, the basket performance amount would equal $0.00 and the maturity payment amount would equal the principal amount of your note.

 

Example 4 —

 

The hypothetical basket return is −10.00%, reflecting a 10.00% decrease in the value of the basket:

 

Basket performance amount (per note) is the greater of:

 

(i) $0.00, or

 

(ii) ($1,000.00 x −10.00% x 102.50%) = −$102.50.

 

Maturity payment amount = $1,000.00 + $0.00 = $1,000.00.

 

Since the hypothetical basket return is less than zero, the basket performance amount would equal $0.00 and the maturity payment amount would equal the principal amount of your note.

HYPOTHETICAL RETURNS

 

The following table illustrates, for a range of hypothetical average commodity appreciations representing equivalent percentage changes in the value of the basket:

 

 

The figures below are for purposes of illustration only. The actual maturity payment amount and the resulting total and pre-tax annualized rate of return will depend on the actual final basket level determined by the calculation agent as described in this pricing supplement.

 

 

 

 

The following graph sets forth the hypothetical return at maturity for a range of hypothetical final basket levels (as a percentage of the initial basket level).

 

Return Profile of Notes vs. the Basket*

 

 

* Based on a participation rate of 102.50%.

 

Who should or should not consider an investment in the notes?

 

We have designed the notes for investors who are willing to hold the notes to maturity; who seek exposure to commodities generally and to the basket components in particular, and who believe that the value of the basket components will increase over the term of the notes; who are capable of understanding the specific risks related to the complexities of the notes and the underlying basket components. The notes are designed for investors who are also unwilling to make an investment that is exposed to downside performance risk of the basket and who seek to protect their investment by receiving at least 100.00% of the principal amount of their investment at maturity.

 

The notes are not designed for, and may not be a suitable investment for, investors who are unable or unwilling to hold the notes to maturity; who require an investment that yields regular returns; who believe that the value of the basket components are likely to decrease or remain unchanged over the term of the notes; who are not capable of understanding the specific risks related to the complexities of the note and the underlying basket components; or who seek exposure to both the full upside performance and the full downside performance risk of the basket components. This may not be a suitable investment for investors who prefer the lower risk of fixed income investments with comparable maturities issued by companies with comparable credit ratings.

 

What will I receive if I sell the notes prior to maturity?

 

The market value of the notes may fluctuate during the term of the notes. Several factors and their interrelationship will influence the market value of the notes, including the levels of the component indices

and the prices of coal, copper and WTI crude oil, the time remaining to the maturity date, interest rates and the volatility of the basket components. The notes are 100.00% principal protected only if held to maturity. If you sell your notes before maturity, you may have to sell them at a discount and you will not have principal protection. Depending on the impact of these factors, you may receive less than the principal amount in any sale of your notes before the maturity date of the notes and less than what you would have received had you held the notes until maturity. For more details, see “Risk Factors — Many factors affect the market value of the notes”.

 

Who publishes the component indices and what do the component indices measure?

 

The Baltic Panamax Index.   The Baltic Panamax Index ( BPI ) is a measure of the cost to ship dry-bulk cargo on Panamax vessels and is calculated from the weighted, average rates on major routes, both voyage and timecharter, as assessed by a panel of brokers. Ships classified as Panamax are of the maximum dimensions that will fit through the locks of the Panama Canal. The Baltic Panamax Index is also a sub-index of the Baltic Dry Index, which is a leading indicator of the global dry cargo freight market, designed to measure changes in the cost of transporting dry bulk material such as grain, coal, iron ore and industrial metals by sea. The Baltic Exchange is the publisher of the Baltic Dry Index.

 

The Baltic Panamax Index is determined, calculated and maintained by the Baltic Exchange without regard to the notes. You should be aware that an investment in the notes does not entitle you to any ownership interest in any of the commodities included in the Baltic Panamax Index. For a detailed discussion of the Baltic Panamax Index, see “The Basket — Baltic Panamax Index” beginning on page P-23.

 

The S&P GSCI Livestock Excess Return Index.   The S&P GSCI Livestock Excess Return Index measures the excess returns that are potentially available through an unleveraged investment in the livestock commodities futures contracts of the S&P Goldman Sachs Commodity Index (the S&P GSCI). The S&P GSCI Livestock Excess Return Index is a sub-index of the S&P Goldman Sachs Commodity Index Excess Return Index (the S&P GSCI Excess Return Index) that relates only to the livestock commodities futures contracts. The S&P GSCI Excess Return Index is one of the major indices of the S&P GSCI. The S&P GSCI Livestock Excess Return Index is calculated, published and disseminated by Standard & Poor’s, a division of The McGraw-Hill Companies ( S&P or Standard & Poor’s ).

 

The S&P GSCI Livestock Excess Return Index is determined, calculated and maintained by S&P without regard to the notes. You should be aware that an investment in the notes does not entitle you to any ownership interest in any of the livestock commodities included in the GSCI Livestock Index. For a detailed discussion of the S&P GSCI Livestock Excess Return Index, see “The Basket — S&P GSCI Livestock Excess Return Index” beginning on page P-26.

 

The S&P GSCI Agriculture Excess Return Index.   The S&P GSCI Agriculture Excess Return Index measures the excess returns that are potentially available through an unleveraged investment in the agricultural commodities futures contracts of the S&P Goldman Sachs Commodity Index (the S&P GSCI). The S&P GSCI Agriculture Excess Return Index is a sub-index of the S&P Goldman Sachs Commodity Index Excess Return Index (the S&P GSCI Excess Return Index) that relates only to the agricultural commodities futures contracts. The S&P GSCI Excess Return Index is one of the major indexes of the S&P GSCI. The S&P GSCI Agriculture Excess Return Index is calculated, published and disseminated by Standard & Poor’s.

 

The S&P GSCI Agriculture Excess Return Index is determined, calculated and maintained by S&P without regard to the notes. You should be aware that an investment in the notes does not entitle you to any ownership interest in any of the agricultural commodities included in the GSCI Agriculture Index. For a detailed discussion of the S&P GSCI Agriculture Excess Return Index, see “The Basket — S&P GSCI Agriculture Excess Return Index” beginning on page P-26.

 

How are the closing prices for the basket components determined?

 

The closing prices for the component indices are determined by reference to the closing levels published by the applicable Index Sponsors at the regular weekday close of trading. The closing price for coal is determined by reference to the official closing price in the issue of Argus/McCloskey’s Coal Price Index Report, as described under “Specific Terms of the Notes — Closing Price” on page P-16. The closing prices of the other component

commodities are determined by reference to the official closing price or cash settlement price on the NYMEX or the LME, as applicable, as described under “Specific Terms of the Notes — Closing Price” on page P-16. The NYMEX is the world’s largest physical commodities futures exchange and a leading trading forum for energy and precious metals. The NYMEX trades a variety of commodity products, including future contracts for WTI crude oil. The LME was established in 1877 and is the principal non-ferrous metals exchange in the world on which contracts for copper, among other metals, are traded. The LME operates as a principals’ market and is, therefore, more closely analogous to over-the-counter physical commodity markets than futures markets. Twice daily during London trading hours a “fixing” occurs which provides reference prices for that day’s trading.

 

How have the basket components performed historically?

 

You can find a table with the published high and low levels in the interbank market of each of the basket components as well as the basket component prices at the end of each calendar quarter from calendar year 2004 to present in the section entitled “The Basket” beginning on page P-23 of this pricing supplement. We have provided this historical information to help you evaluate the behavior of the basket components in the recent past; however, past performance of the basket components does not indicate how they will perform in the future.

 

What about taxes?

 

The notes will be treated as debt instruments subject to special rules governing contingent payment debt obligations for United States federal income tax purposes. If you are a U.S. individual or taxable entity, you generally will be required to pay taxes on ordinary income from the notes over their term based on the comparable yield for the notes, even though you will not receive any payments from us until maturity. This comparable yield is determined solely to calculate the amount on which you will be taxed prior to maturity and is neither a prediction nor a guarantee of what the actual yield will be. In addition, any gain you may recognize on the sale or maturity of the notes will be taxed as ordinary interest income. If you are a secondary purchaser of the notes, the tax consequences to you may be different.

 

For further discussion, see “Taxation in the United States” below and in the accompanying prospectus supplement and prospectus.

 

Will the notes be listed on a stock exchange?

 

The notes will not be listed or displayed on any securities exchange or any electronic communications network. There can be no assurance that a liquid trading market will develop for the notes. Accordingly, if you sell your notes prior to maturity, you may have to sell them at a substantial loss. You should review the section entitled “Risk Factors — There may not be an active trading market for the notes” in this pricing supplement.

 

Are there any risks associated with my investment?

 

Yes, an investment in the notes is subject to significant risks. We urge you to read the detailed explanation of risks in “Risk Factors” beginning on page P-9.

RISK FACTORS

 

An investment in the notes is subject to the risks described below, as well as the risks described under “Risk Factors — Risks relating to index linked notes or notes linked to certain assets” in the accompanying prospectus supplement. Your notes are a riskier investment than ordinary debt securities. Also, your notes are not equivalent to investing directly in the components which comprise the basket to which the notes are linked. You should carefully consider whether the notes are suited to your particular circumstances.

 

The notes are intended to be held to maturity. Your principal is protected only if you hold your notes to maturity

 

You will receive at least 100.00% of the principal amount of your notes if you hold your notes to maturity, subject to our ability to pay our obligations. If you sell your notes in the secondary market before maturity, you will not receive principal protection on the notes you sell.

 

You will not receive interest payments on the notes

 

You will not receive any periodic interest payments on the notes or any interest payment at maturity. At maturity, you may not receive any return in excess of the principal amount of your notes.

 

Your yield on the notes may be lower than the yield on a standard senior debt security of comparable maturity

 

The yield that you will receive on your notes, which could be zero, may be less than the return you could earn on other investments. Even if your yield is positive, your yield may be less than the yield you would earn if you bought a standard senior non-callable debt security with the same maturity date. Your investment may not reflect the full opportunity cost to you when you take into account factors that affect the time value of money. In addition, no interest will be paid during the term of your notes.

 

If the basket return is less than or equal to zero, the maturity payment amount for each note will be limited to the principal amount of the note. This will be true even if the value of the basket, as measured by the basket return, on some date or dates before the valuation date is greater than the value of the basket on the trade date, because the maturity payment amount will be calculated only on the basis of the basket return on the valuation date (or as otherwise determined by the calculation agent, in the case of a market disruption event). You should, therefore, be prepared to realize no return at maturity over the principal amount of your notes.

 

Owning the notes is not the same as having rights in exchange-traded futures contracts on the basket components

 

You will not have rights that holders of the exchange-traded futures on the basket components may have. Even if the value of the basket components increases during the term of the notes, the market value of the notes may not increase by the same amount. It is also possible for the value of the basket components to increase while the market value of the notes declines.

 

Your return is limited and will not reflect the return of owning the component commodities or the commodities underlying the component indices

 

The return on your notes will not reflect the return you would realize if you actually owned and held an interest in the component commodities or the component indices for a similar period. Even if the basket level increases during the term of the notes, the market value of the notes may not increase by the same amount. It is also possible for the basket level to increase while the market value of the notes declines.

 

There may not be an active trading market for the notes

 

The notes will not be listed or displayed on any securities exchange or any electronic communications network. There can be no assurance that a liquid trading market will develop for the notes. The development of a trading market for the notes will depend on our financial performance and other factors, such as the increase, if any,

in the value of the basket. Even if a secondary market for the notes develops, it may not provide significant liquidity and transaction costs in any secondary market could be high. As a result, the difference between bid and asked prices for the notes in any secondary market could be substantial. If you sell your notes before maturity, you may have to do so at a discount from the initial public offering price, and, as a result, you may suffer substantial losses.

 

Wachovia Capital Markets, LLC and its broker-dealer affiliates currently intend to make a market for the notes, although they are not required to do so and may stop any such market-making activities at any time. As market makers, trading of the notes may cause Wachovia Capital Markets, LLC or its broker-dealer affiliates to have long or short positions in the notes. The supply and demand for the notes, including inventory positions of market makers, may affect the secondary market for the notes.

 

Many factors affect the market value of the notes

 

The market value of the notes will be affected by factors that interrelate in complex ways. It is important for you to understand that the effect of one factor may offset the increase in the market value of the notes caused by another factor and that the effect of one factor may compound the decrease in the market value of the notes caused by another factor. For example, a change in the volatility of the basket components’ markets may offset some or all of any increase in the market value of the notes attributable to another factor, such as an increase in the prices of the basket components. In addition, a change in interest rates may offset other factors that would otherwise change the prices of the basket components and, therefore, may change the market value of the notes.

 

We expect that the market value of the notes will depend substantially on the amount, if any, by which the value of the basket increases during the term of the notes. If you choose to sell your notes when the level of the basket, based on then current prices of the basket components, is greater than zero, you may receive substantially less than the amount that would be payable at maturity based on this increase because of the expectation that the level of the basket will continue to fluctuate until the valuation date. We believe that other factors that may influence the value of the notes include:

 

 

Regulation of the commodity markets is extensive and constantly changing; future regulatory developments are impossible to predict and may significantly and adversely affect the level of the notes

 

Regulation of the commodity markets is extensive and constantly changing; future regulatory developments are impossible to predict and may significantly and adversely affect the level of the notes. The levels of the basket components will depend on the trading prices of, for example, precious metals futures, agricultural commodities futures, livestock commodities futures and freight commodities futures in the commodities market. Futures contracts and options on futures contracts, including those relating to precious metals, agricultural commodities, livestock commodities and freight commodities are subject to extensive statutes, regulations and margin requirements. The Commodities Futures Trading Commission and exchanges are authorized to take extraordinary actions

in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily limits and the suspension of trading. These limits could adversely affect the market price of the precious metals, agricultural commodities, livestock commodities and dry bulk commodities futures contracts and forward contracts. The regulation of commodity transactions in the United States is subject to ongoing modification by government and judicial action. In addition, various national governments have expressed concern regarding the disruptive effects of speculative trading in the commodity markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on the value of the notes is impossible to predict, but could be substantial and adverse to holders of the notes.

 

There are specific risks associated with the component commodities

 

Coal.   The price of coal is affected by the global demand for and supply of coal. Due to the importance of coal in the generation of electricity and the production of iron and steel, the electric and steel industries account for a significant percentage of coal demand. Nuclear power, natural gas, hydro-electric power, wind and solar power and crude oil can be used as substitutes for coal, and the availability and price of each of these alternative energy sources also affects demand for coal. Government regulations regarding air pollution affect the demand for coal, and, specifically, the demand for specific types of coal, by limiting the amount of sulfur dioxide which may be emitted during the use of coal. Other factors that affect the price of coal include weather patterns, discoveries of new coal deposits, labor and equipment costs, environmental, health and safety and other government regulations, including the regulation of mines, government subsidies and tax incentives, and transportation disruptions.

 

Copper.   The price of copper is primarily affected by the global demand for, and supply of, copper. Demand for copper is significantly influenced by the level of global industrial economic activity. Industrial sectors which are particularly important include the electrical and construction sectors. In recent years demand has been supported by strong consumption from newly industrializing countries, which continue to be in a copper-intensive period of economic growth as they develop their infrastructure. An additional, but highly volatile, component of demand is adjustments to inventory in response to changes in economic activity and/or pricing levels.

 

Apart from the United States, Canada and Australia, the majority of copper concentrate supply (the raw material) comes from countries that have experienced political instability and upheaval and, as a result, copper supply has been affected by strikes, financial problems and terrorist activity in recent years.

 

WTI Crude Oil.   Oil prices are highly volatile. They are affected by numerous factors in addition to economic activity. These include political events, weather, labor activity, and, especially, direct government intervention such as embargos, and supply disruptions in major producing or consuming regions such as the Middle East, the United States, Latin America and Russia. Such events tend to affect oil prices worldwide, regardless of the location of the event. The outcome of meetings of the Organization of Petroleum Exporting Countries can particularly affect world oil supply and oil prices. Oil prices could also be affected by any decision by the Organization of Petroleum Exporting Countries to quote oil prices in a currency other than U.S. dollars (such as euro), which could decrease liquidity in the applicable futures contract, and thereby affect the value of such futures contract. Market expectations about these events and speculative activity also cause prices to fluctuate. Due to the recent rapid appreciation in energy prices, there is a significant possibility that a negative correction will occur and decrease oil prices, thereby adversely affecting the value of the basket.

 

Furthermore, a significant proportion of world oil production capacity is controlled by a small number of producers, and such producers have in the recent past implemented curtailments of output and trade. Such efforts at supply curtailment (or the cessation thereof) could affect the value of the applicable futures contract. Oil’s major end-use as a refined product is as a transport fuel, industrial fuel and in-home heating fuel. Potential for substitution exists in most areas, although considerations including relative cost often limit substitution levels. However, the development of a substitute product or transport fuel could adversely affect the value of the applicable futures contract.

 

In the event of sudden disruptions in the supplies of oil, such as those caused by war, accidents, weather or acts of terrorism, prices of oil futures contracts and, consequently, the value of the basket, could become extremely volatile and unpredictable. Also, sudden and dramatic declines in futures contract prices may occur, for example, upon a cessation of hostilities that may exist in countries producing oil, the discovery of significant additional

sources or reserves of oil, the introduction of new or previously withheld supplies into the market (e.g., oil from Iraq) or the introduction of substitute products or commodities. Any such declines could have a significant adverse effect on the value of the basket and on the value of the notes. In addition, the price of oil has on occasion been subject to very rapid and significant short-term changes due to speculative activities which, if such activities result in a price decrease, may cause the value of the notes to decrease. Such volatility could lead some investors in oil futures contracts to withdraw from the applicable futures markets, which could adversely affect the liquidity of such markets and could adversely affect the value of the basket and, correspondingly, the value of the notes.

 

Risks relating to trading of commodities on the LME

 

The closing price of copper will be determined by reference to the U.S. dollar settlement prices of contracts traded on the LME. The LME is a principals’ market which operates in a manner more closely analogous to the over-the-counter physical commodity markets than regulated futures markets, and certain features of U.S. futures markets are not present in the context of LME trading. For example, there are no daily price limits on the LME, which would otherwise restrict the extent of daily fluctuations in the prices of LME contracts. In a declining market, therefore, it is possible that prices would continue to decline without limitation within a trading day or over a period of trading days. In addition, depending on the underlying commodity, a contract may be entered into on the LME calling for daily delivery from one day to three months following the date of such contract and for monthly delivery from the seventh month following the date of such contract up to 63 months following the date of such contract, in contrast to trading on futures exchanges, which call for delivery in stated delivery months. As a result, there may be a greater risk of a concentration of positions in LME contracts on particular delivery dates, which in turn could cause temporary aberrations in the prices of LME contracts for certain delivery dates. If such aberrations occur on the valuation date, the U.S. dollar settlement prices used to determine the closing price of copper, and consequently the maturity payment amount, could be adversely affected.

 

There are specific risks associated with the Baltic Dry Index

 

The Baltic Dry Index is designed to measure changes in the cost of transporting dry bulk material by sea. The dry cargo freight market is sensitive to a variety of external variables, the most important of which include fleet supply, commodity demand, seasonal pressures and fuel prices.

 

Contract pricing in the commodities markets will affect the performance amounts of the S&P GSCI Indices

 

As the contracts that underlie the S&P GSCI come to expiration, they are replaced by contracts that have a later expiration. Thus, for example, a contract purchased and held in August may specify a December expiration. As time passes, the December contract is replaced by a contract for delivery in February. This is accomplished by selling the December contract and purchasing the February contract. This process is referred to as “rolling”. If the market for these contracts (putting aside other considerations) is in “backwardation,” which describes a situation where the prices are lower in the distant delivery months than in the nearest delivery months, the sale of the December contract will take place at a price that is higher than the price at which that contract was originally purchased in August, thereby creating the “roll yield”. While many of the contracts included in the S&P GSCI have historically exhibited consistent periods of backwardation, backwardation will most likely not exist at all times. Moreover, certain of the commodities included in the S&P GSCI have historically been “contango” markets. Contango markets are markets in which the prices of contracts are higher in the distant delivery months than in the nearer delivery months. Contango in the commodity markets could result in negative “roll yields,” which could adversely affect the levels of the GSCI Agriculture and the GSCI Livestock indices and accordingly, because of the formula used, decrease the maturity payment amount on your notes. Therefore, it could be the case that the levels of the S&P GSCI Agricultural Index — Excess Return and S&P GSCI Livestock Index — Excess Return, relative to the actual price of the underlying commodities, will be adversely affected by negative roll yields.

We and our affiliates have no affiliation with S&P, the Baltic Exchange, Argus/McCloskey, the NYMEX or the LME and are not responsible for their public disclosure of information

 

We and our affiliates are not affiliated with S&P, the Baltic Exchange, Argus/McCloskey, the NYMEX or the LME in any way (except, in the case of the component indices, for licensing arrangements discussed below under “The S&P GSCI Indices”) and have no ability to control or predict its actions, including any errors in or discontinuation of disclosure regarding any of their methods or policies relating to the calculation of the component indices or the determination of the closing prices of the component commodities, as applicable. Argus/McCloskey, the NYMEX and the LME are not under any obligation to continue to determine the closing prices for any of the component commodities. If S&P or the Baltic Exchange discontinues or suspends the calculation of a component index or Argus/McCloskey, the NYMEX or the LME discontinue or materially change the method of determining the closing prices for any of the basket commodities, it may become difficult to determine the market value of the notes or the maturity payment amount. The calculation agent may designate a successor index or successor provider of closing prices selected in its sole discretion. If the calculation agent determines in its sole discretion that no successor index comparable to the component index or comparable provider of closing prices, as applicable, exists, the amount you receive at maturity will be determined by the calculation agent in its sole discretion. See “Specific Terms of the Notes — Market Disruption Event” on page P-17 and “Specific Terms of the Notes — Adjustments to the Basket Components” on page P-19.

 

Each note is an unsecured debt obligation of Eksportfinans only and is not an obligation of S&P, the Baltic Exchange, the NYMEX or the LME. None of the money you pay for your notes will go to S&P, the Baltic Exchange, the NYMEX or the LME. Since none of S&P, the Baltic Exchange, the NYMEX or the LME is involved in the offer of the notes in any way, none of them have any obligation to consider your interest as an owner of notes in taking any actions that might affect the value of your notes, and they may take actions that will adversely affect the market value of the notes.

 

We have derived the information about S&P, the Baltic Exchange, the NYMEX, the LME and the basket components in this pricing supplement from publicly available information, without independent verification. Neither we nor any of our affiliates assumes any responsibility for the adequacy or accuracy of the information about the basket components or S&P, the Baltic Exchange, the NYMEX or the LME contained in this pricing supplement. You, as an investor in the notes, should make your own investigation into the basket components, S&P, the Baltic Exchange, the NYMEX and the LME.

 

Historical prices of the basket components should not be taken as indications of the future prices of the basket components during the term of the notes

 

The value of the basket components will be influenced by complex and interrelated political, economic, financial and other factors. As a result, it is impossible to predict whether the value of the basket components will appreciate or depreciate over the term of the notes.

 

The basket is not a recognized market index and may not accurately reflect global market performance

 

The basket is not a recognized market index. The basket was created solely for purposes of the offering of the notes and will be calculated solely during the term of the notes. The level of the basket and, therefore, the basket return, however, will not be published during the term of the notes. The basket does not reflect the performance of all major securities or commodities markets, and may not reflect actual global market performance.

 

Hedging transactions may affect the return on the notes

 

As described below under “Use of Proceeds and Hedging” on page P-42, we through one or more hedging counterparties may hedge our obligations under the notes by purchasing the basket components, futures or options on the basket components or other derivative instruments with returns linked or related to changes in the performance of the basket components, and our hedging counterparties may adjust these hedges by, among other things, purchasing or selling the basket components, futures, options or other derivative instruments with returns linked to the basket components at any time. Although they are not expected to, any of these hedging activities may adversely affect the values of the basket components and the basket return. It is possible that our hedging

counterparties could receive substantial returns from these hedging activities while the market value of the notes declines. The inclusion of commissions and projected profits from hedging in the initial public offering price is likely to adversely affect secondary market prices for the notes.

 

Assuming no change in market conditions or any other relevant factors, the price, if any, at which Wachovia Capital Markets, LLC is willing to purchase the notes in secondary market transactions will likely be lower than the initial public offering price, since the initial public offering price included, and secondary market prices are likely to exclude, commissions paid with respect to the notes, as well as the projected profit included in the cost of hedging our obligations under the notes. In addition, any such prices may differ from values determined by pricing models used by Wachovia Capital Markets, LLC, as a result of dealer discounts, mark-ups or other transactions.

 

The calculation agent may postpone the determination of the basket return and the maturity date if a market disruption event occurs on the valuation date

 

The determination of the basket return may be postponed if the calculation agent determines that a market disruption event has occurred or is continuing on the valuation date with respect to one or both basket components. If a postponement occurs, then for each basket component with respect to which a market disruption event has occurred or is continuing, the calculation agent will use the closing price on the next succeeding trading day on which no market disruption event occurs or is continuing with respect to that basket component for the calculation of the basket return; provided that in no event will the valuation date with respect to any basket component be postponed by more than ten trading days. As a result, the maturity date for the notes would be postponed. You will not be entitled to compensation from us or the calculation agent for any loss suffered because of a market disruption event or any resulting delay in payment. See “Specific Terms of the Notes — Market Disruption Event” beginning on page P-17.

 

Potential conflicts of interest could arise

 

Wachovia Capital Markets, LLC and its affiliates may engage in trading activities related to the basket components that are not for the account of holders of the notes or on their behalf. These trading activities may present a conflict between the holders’ interest in the notes and the interests we and our affiliates will have in their proprietary accounts, in facilitating transactions, including options and other derivatives transactions, for their customers and in account under their management. These trading activities, if they influence the value of the basket components, could be adverse to the interests of the holders of the notes.

 

U.S. taxpayers will be required to pay taxes on the notes each year

 

The notes will be treated as debt instruments subject to special rules governing contingent payment debt obligations for United States federal income tax purposes. If you are a U.S. individual or taxable entity, you generally will be required to pay taxes on ordinary income over the term of the notes based on the comparable yield for the notes, even though you will not receive any payments from us until maturity. This comparable yield is determined solely to calculate the amounts you will be taxed on prior to maturity and is neither a prediction nor a guarantee of what the actual yield will be. Any gain you may recognize on the sale or maturity of the notes will be ordinary interest income. Any loss you may recognize upon the sale of the notes will be ordinary loss to the extent of the interest you included as income in the current or previous taxable years in respect of the notes, and thereafter will be capital loss. If you hold your notes until maturity and the maturity payment is less than the projected payment at maturity, the difference will first reduce interest that would otherwise accrue in respect of the notes in such taxable year, and any remainder will be ordinary loss to the extent of the interest you previously accrued as income in respect of the notes, and thereafter will be capital loss. If you are a secondary purchaser of the notes, the tax consequences to you may be different. You should consult your tax advisor about your own tax situation.

 

For further discussion, see “Taxation in the United States” below and in the accompanying prospectus supplement and prospectus.

SPECIFIC TERMS OF THE NOTES

 

 

                                                 initial basket level  

 

                                                             initial basket level

 

 

 

 

 

 

 

 

The notes are not renewable notes, index linked notes or amortizing notes, each as described in the prospectus supplement. The notes are zero coupon notes and, as such, do not pay interest. In addition, there is no optional redemption or extension of maturity in connection with the notes.

 

Capitalized terms used in this pricing supplement without definition have the meanings given to them in the accompanying prospectus supplement and prospectus.

ADDITIONAL INFORMATION

 

Calculation agent

 

We have initially appointed Wachovia Bank, N.A. as calculation agent. Unless there is manifest error, these determinations by the calculation agent shall be final and binding on us and the holders of the notes.

 

THE BASKET

 

The basket is an equally-weighted basket of the following six commodities and commodity indices: coal, copper, WTI Crude Oil, the Baltic Panamax Index, the S&P GSCI Agriculture Excess Return Index and the S&P GSCI Livestock Excess Return Index. We have obtained all information on the basket components and the basket component values from public sources, without independent verification.

 

The Baltic Panamax Index

 

The Baltic Panamax Index ( BPI ) is a measure of the cost to ship dry-bulk cargo on Panamax vessels and is calculated from the weighted, average rates on major routes, both voyage and timecharter, as assessed by a panel of brokers. Ships classified as Panamax are of the maximum dimensions that will fit through the locks of the Panama Canal.

 

The Baltic Panamax Index is one of the four sib-indices of the Baltic Dry Index ( BDI ). The Baltic Dry Index was developed by the Baltic Exchange and is calculated, maintained and published by the Baltic Exchange and is a leading indicator of the global dry cargo freight market, designed to measure changes in the cost of transporting dry bulk material such as grain, coal, iron ore and industrial metals by sea. The BDI is an equally-weighted composite index of four sub-indices devoted to different sizes of dry bulk carriers (Baltic Capesize Index, Baltic Panamax Index, Baltic Supramax Index and Baltic Handysize Index), which together cover approximately 30 shipping routes measured on a timecharter ($/day) or voyage ($/tonne) basis. The BDI was first published on November 1, 1999 as the successor to the Baltic Freight Index which commenced publication on January 4, 1985. You can obtain the level of the Baltic Dry Index on the Bloomberg website at http://quote.bloomberg.com/apps/quote?ticker=bdiy&exch=IND&x=15&y=11. The Bloomberg website is being provided for reference purposes only. The level of the BDI will be determined for purposes of this pricing supplement based on the prices published by the Baltic Exchange, the publisher of the BDI.

 

The Baltic Exchange is a global marketplace of shipbrokers, ship owners and charterers, based in London, England. The Baltic Exchange provides freight indices and route assessments and also operates as a maker of markets in freight derivatives, specifically a type of forward contract known as forward freight agreements ( FFA s) that are traded over the counter. The Freight Indices and Futures Committee ( FIFC ) at the Baltic Exchange is responsible for production of the BDI and other freight indices published by the Baltic Exchange, utilizing the professional assessments made by a panel of reporting shipbrokers on the prevailing open market levels. In compiling any of the sub-indices, the FIFC selects the component routes and determines their weightings with a goal of producing a weighted basket of routes which is as representative as possible of the world’s principal bulk cargo trades for that sub-index. The daily level of the sub-index is based on the average assessment made by all reporting panellists of the current market rate with respect to each route included in the sub-index and the applicable weighting for such route. The publication of the BDI and other freight indices of the Baltic Exchange is governed by the following rules.

 

Publication.   The component sub-indices of the BDI and the BDI will normally be published by the Baltic Exchange at approximately 1 p.m. London time on each business day. The Baltic Exchange may delay or cancel publication of the indices and routes if considered necessary or desirable. The Baltic Exchange provides route and index data only if it is fully satisfied that sufficient assessments from an adequate quorum of its reporting panelists have been received. If there are not sufficient panelists able or willing to report their assessments on any route or index then the Baltic Exchange has the right not to report on that day or any subsequent days until an adequate quorum has been assembled.

 

The Panel.   The Baltic Exchange appoints a panel of shipbroker companies from its members. The Baltic Exchange may change the number of panelists and the composition of the panel at any time but aims to have panels

consisting of at least seven panelists per index. As of July 2007, the number of panelists on each of the four sub-indices of the BDI ranges from 12 to 22.

 

The Routes.   The Baltic Exchange has the right to decide which routes are to be included and may alter the composition of the routes from time to time. Since September 2002, all panelists’ returns have been included in establishing the average assessment on dry routes. Prior to that date, both the highest and lowest returns were excluded.

 

Weightings.   The Baltic Exchange from time to time decides the weighting applied to any route for the purpose of ascertaining its contribution to an index.

 

Weighting Factors.   For the purpose of calculating the indices, the average rate for each route will be multiplied by the weighting factor for that route. The weighting factor for each route is ascertained by the Baltic Exchange and may be adjusted by the Baltic Exchange to take account of alterations to routes or route weightings.

 

Alterations to the Indices.   No more than one route will be removed from an index at any one time. If a route is removed, one or more routes may be substituted for it.

 

The weighting of an existing route will not be altered by more than an amount equal to 25% of its existing weighting or 2.5% of the index at the date of the decision to make the alteration, whichever is the larger. No such limitation will apply to routes that are removed from or added to an index.

 

Any one alteration to an index will not result in an adjustment of more than 5% in the regional or commodity composition of a given index. The meaning of “region” and “commodity” for this purpose will be in the absolute discretion of the Baltic Exchange.

 

When an alteration is made, a revised set of weighting factors will be applied to the routes, so that the new index will have the same level as the old index at the date of the alteration. The dry cargo freight market is sensitive to a variety of external variables, the most important of which include the following:

 

 

The notes are not sponsored, endorsed, sold or promoted by The Baltic Exchange. The Baltic Exchange makes no representation or warranty, express or implied, to the owners of the notes or any member of the public regarding the advisability of investing in the notes. The Baltic Exchange will not accept any liability for any loss incurred in any way whatsoever by any person who seeks to rely on the information contained herein.

 

Historical closing levels of the Baltic Panamax Index

 

The following table sets forth the published high and low closing levels of the Baltic Panamax Index as well as closing levels of the Baltic Panamax Index at the end of each quarter from January 1, 2004 through March 31, 2008 and the period from April 1, 2008 through April 14, 2008. On April 14, 2008, the closing level of the Baltic Panamax Index was 8,079.00. This historical data on the Baltic Panamax Index is not indicative of the future levels of the Baltic Panamax Index or what the market value of the notes may be. Any historical upward or downward trend in the

level of the Baltic Panamax Index during any period set forth below is not any indication that the level of the Baltic Panamax Index is more or less likely to increase or decrease at any time during the term of the notes.

 

 

The S&P GSCI Indices

 

The following is a description of both the S&P GSCI Agriculture Excess Return Index and the S&P GSCI Livestock Excess Return Index. We have obtained all information regarding the S&P GSCI Agriculture Excess Return Index and the S&P GSCI Livestock Excess Return Index contained in this pricing supplement, including their make-up, method of calculation and changes in their components, from publicly available information. That information reflects the policies of, and is subject to change by, S&P. Standard & Poor’s has no obligation to continue to publish, and may discontinue publication of, the S&P GSCI Agriculture Excess Return Index and the S&P GSCI Livestock Excess Return Index at any time. We make no representation or warranty as to the accuracy or completeness of such information. You, as an investor in the notes, should make your own investigations into the S&P GSCI Agriculture Excess Return Index and the S&P GSCI Livestock Excess Return Index and S&P.

 

The GSCI Agriculture and the GSCI Livestock are two Component Commodities. Each of the Indices is a constituent of the larger S&P Goldman Sachs Commodity Index (“GSCI”). The GSCI and the Indices are published by Standard & Poor’s, a division of The McGraw-Hill Companies (“S&P”) and are determined, composed and calculated by S&P without regard to the notes.

 

The Indices reflect the excess returns that are potentially available through an unleveraged investment in the futures contracts relating to the various components of the GSCI. Since the GSCI is the parent index of the Indices, the methodology for compiling the GSCI relates as well to the methodology of compiling the Indices.

 

The GSCI is a proprietary index that Goldman, Sachs & Co. (“Goldman, Sachs”) developed. Effective February 8, 2007, The Goldman Sachs Group, Inc. (“GS Group”) completed a transaction with S&P by which GS Group sold to S&P all of the rights of Goldman, Sachs in the GSCI and all related indices, as well as certain intellectual property related to the GSCI. According to publicly available information, as of that date, Goldman, Sachs no longer owned the Indices and is no longer responsible for the calculation, publication or administration of the Indices, or for any changes to the methodology. As a result, all decisions with respect to the Indices will be made, and the related actions will be taken, solely by S&P. Goldman, Sachs will have no control over any matters related to the Indices.

 

The S&P GSCI Agriculture Index Excess Return was formerly known as the GSCI Agriculture Index Excess Return. The S&P GSCI Livestock Index Excess Return was formerly known as the GSCI Livestock Index Excess Return.

The S&P GSCI Agriculture Excess Return Index

 

The S&P GSCI Agriculture Excess Return Index reflects the excess returns that are potentially available through an unleveraged investment in the agricultural commodities futures contracts of the S&P GSCI. The GSCI Agriculture Index is a sub-index of the S&P GSCI Excess Return Index, and that index is a sub-index of the S&P GSCI. The GSCI Agriculture Index is comprised solely of those agricultural commodities futures contracts included in the S&P GSCI Excess Return Index. For a description of how contracts are selected for the S&P GSCI and a discussion of the S&P GSCI in general, see below under “— The S&P GSCI Excess Return Index and the S&P GSCI”.

 

Value of the GSCI Agriculture Excess Return Index

 

The value of the GSCI Agriculture Index on any given day is calculated in the same manner as the S&P GSCI Excess Return Index (described below) except that (i) the daily contract reference prices, the contract production weight ( CPW ) and roll weights used in performing such calculations are limited to those of the S&P GSCI agricultural commodities included in the GSCI Agriculture Index; and (ii) the GSCI Agriculture Index has a separate normalizing constant.

 

The commodities included in the GSCI Agriculture Index and their weightings on April 14, 2008 are:

 

 

The S&P GSCI Livestock Excess Return Index

 

The S&P GSCI Livestock Excess Return Index reflects the excess returns that are potentially available through an unleveraged investment in the livestock commodities futures contracts of the S&P GSCI. The S&P GSCI Livestock Excess Return Index is a sub-index of the S&P GSCI Excess Return Index, and that index is a sub-index of the S&P GSCI. The S&P GSCI Livestock Excess Return Index is comprised solely of those livestock commodities futures contracts included in the S&P GSCI Excess Return Index. For a description of how contracts are selected for the S&P GSCI and a discussion of the S&P GSCI in general, see below under “— The S&P GSCI Excess Return Index and the S&P GSCI”.

 

Value of the GSCI Livestock Excess Return Index

 

The value of the GSCI Livestock Excess Return Index on any given day is calculated in the same manner as the S&P GSCI Excess Return Index (described below) except that (i) the daily contract reference prices, the contract production weight ( CPW ) and roll weights used in performing such calculations are limited to those of the S&P GSCI Livestock commodities included in the GSCI Livestock Index; and (ii) the GSCI Livestock Index has a separate normalizing constant.

The commodities included in the GSCI Livestock Index and their weightings on April 14, 2008 are:

 

 

The Components of the S&P GSCI Indices

 

The components of the S&P GSCI Indices and their relative weightings, among other matters, may change during the term of the notes. The roll weight of each commodity reflects the fact that the positions in contracts must be liquidated or rolled forward into more distant contract expirations as they approach expiration. If actual positions in the relevant markets were rolled forward, the roll would likely need to take place over a period of days. Since the GSCI Agriculture and the GSCI Livestock indices are designed to replicate the performance of actual investments in the underlying contracts, the rolling process incorporated in the GSCI Agriculture and the GSCI Livestock indices also takes place over a period of days at the beginning of each month (referred to as the roll period). On each day of the roll period, the “roll weights” of the first nearby contract expirations on a particular commodity and the more distant contract expiration into which it is rolled are adjusted, so that the hypothetical position in the contract on the commodity that is included in either the GSCI Agriculture Index or GSCI Livestock Index is gradually shifted from the first nearby contract expiration to the more distant contract expiration.

 

The simplest way to think of the process is as rolling from one basket of nearby futures (the first nearby basket) to a basket of futures contracts that are further from expiration (the second nearby basket). The GSCI Agriculture Index or the GSCI Livestock Index is calculated as though these rolls occur at the end of each day during the roll period at the daily settlement prices. The portfolio is shifted from the first to the second nearby baskets at a rate of 20% per day for the five days of the roll period. Until just before the end of the first day of the roll period, the entire S&P GSCI portfolio consists of the first nearby basket of commodity futures. At the end of the first day of the roll period, the portfolio is adjusted so that 20% of the contracts held are in the second nearby basket (i.e., a basket of future contracts that are further from maturity), with 80% remaining in the first nearby basket.

 

The roll process continues on the second, third and fourth days of the roll period, with relative weights of first to second nearby baskets of 60%/40%, 40%/60%, and 20%/80%. At the end of the fifth day of the roll period, the last of the old first nearby basket is exchanged, completing the roll and leaving the entire portfolio in what we have been calling the second nearby basket. At this time, this former second nearby basket becomes the new first nearby basket, and a new second nearby basket is formed (with futures maturities further in the future) for use in the next month’s roll.

 

The last key point to be made about the roll process is to specify exactly what the 80%/20% or other relative splits between nearby baskets mean. The roll percentages refer to contracts or quantities, not value. Taking the first day of the roll as an example, just before the roll takes place at the end of the day, the S&P GSCI consists of the first nearby basket. That portfolio, constructed the night before and held throughout the first day of the roll period, has a dollar value. For the roll, that dollar value is distributed across the first and second nearby baskets such that the number of contracts or the quantity of the first nearby basket is 80% of the total and the quantity held of the second nearby basket is 20% of the total.

 

The dollar value held of each nearby basket can then be calculated from those quantity weights by multiplying them by the prices of the futures contracts contained in each basket. As the baskets contain futures with different maturities for some of the commodities, the prices are generally close but not exactly the same. Hence, the percentage of the portfolio value (i.e., dollar weight) held in each basket is generally close to, but not exactly equal to, the 80%/20% or other relative splits specified for the quantities. The world-production weighting of the S&P GSCI is accomplished by keeping the quantity weights of the individual commodities within each basket proportional to world production weights, which are averages of historical production levels and are generally updated every year.

The S&P GSCI Excess Return Index and the S&P GSCI

 

The S&P GSCI Excess Return Index, originally established in May 1991 by The Goldman Sachs Group, Inc. and subsequently purchased by Standard & Poor’s in early 2007, reflects the excess returns that are potentially available through an unleveraged investment in the contracts composing the S&P GSCI. The S&P GSCI is a proprietary index that S&P calculates. The value of the S&P GSCI, on any given day, reflects

 

 

Each of these components is described below.

 

The S&P GSCI is an index on a production weighted basket of principal non-financial commodities (i.e., physical commodities) that satisfy specified criteria. The S&P GSCI is designed to be a measure of the performance over time of the markets for these commodities. The only commodities represented in the S&P GSCI are those physical commodities on which active and liquid contracts are traded on trading facilities in major industrialized countries. The commodities included in the S&P GSCI are weighted, on a production basis, to reflect the relative significance (in the view of S&P, in consultation with the Policy Committee, as described below) of such commodities to the world economy. The fluctuations in the value of the S&P GSCI are intended generally to correlate with changes in the prices of such physical commodities in global markets. The S&P GSCI was established in 1991 and has been normalized so that its hypothetical level on January 2, 1970 was 100. Futures contracts on the S&P GSCI, and options on such futures contracts, are currently listed for trading on the Chicago Mercantile Exchange.

 

Set forth below is a summary of the composition of and the methodology used to calculate the S&P GSCI as of the date of this Pricing Supplement. The methodology for determining the composition and weighting of the S&P GSCI and for calculating its value is subject to modification in a manner consistent with the purposes of the S&P GSCI, as described below. Standard & Poor’s makes the official calculations of the S&P GSCI. At present, this calculation is performed continuously and is reported on Reuters page GSCI (or any successor or replacement page) and is updated on Reuters at least once every three minutes during business hours on each day on which the offices of Standard & Poor’s in New York City are open for business, which we refer to as a S&P GSCI Business Day for the purposes of this description. The settlement price for the S&P GSCI Excess Return Index is also reported on Reuters page GSCI (or any successor or replacement page) at the end of each S&P GSCI Business Day.

 

Standard & Poor’s, and certain of its affiliates, will trade the contracts composing the S&P GSCI or any of its sub-indexes, as well as the underlying commodities and other derivative instruments thereon, for their proprietary accounts and other accounts under their management. There may be conflicts of interest between you and Standard & Poor’s. See “Risk Factors — Potential conflicts of interest could arise” on page P-14.

 

In light of the rapid development of electronic trading platforms and the potential for significant shifts in liquidity between traditional exchanges and such platforms, S&P has undertaken a review of both the procedures for determining the contracts to be included in the S&P GSCI and the procedures for evaluating available liquidity on an intra-year basis in order to provide S&P GSCI market participants with efficient access to new sources of liquidity and the potential for more efficient trading. In particular, S&P, in consultation with the Policy Committee described below, is examining the conditions under which an instrument traded on an electronic platform, rather than a traditional futures contract traded on a traditional futures exchange, should be permitted to be included in the S&P GSCI and how the composition of the S&P GSCI should respond to rapid shifts in liquidity between such instruments and contracts currently included in the S&P GSCI. Any changes made to the S&P GSCI composition or methodology as a result of this examination will be announced by S&P and provided in a written statement to any investor upon request to the calculation agent.

Composition of the S&P GSCI

 

In order to be included in the S&P GSCI, a contract must satisfy the following eligibility criteria:

 

 

 

The commodity must be the subject of a contract that:

 

 

 

The price of the relevant contract that is used as a reference or benchmark by market participants (referred to as the daily contract reference price ) generally must have been available on a continuous basis for at least two years prior to the proposed date of inclusion in the S&P GSCI. In appropriate circumstances, however, S&P, in consultation with the Policy Committee, may determine that a shorter time period is sufficient or that historical daily contract reference prices for such contract may be derived from daily contract reference prices for a similar or related contract. The daily contract reference price may be (but is not required to be) the settlement price or other similar price published by the relevant trading facility for purposes of margining transactions or for other purposes.

 

At and after the time a contract is included in the S&P GSCI, the daily contract reference price for such contract must be published between 10:00 A.M. and 4:00 P.M., New York City time, on each business day relating to such contract by the trading facility on or through which it is traded and must generally be available to all members of, or participants in, such facility (and, if S&P is not such a member or participant, to S&P) on the same day from the trading facility or through a recognized third-party data vendor. Such publication must include, at all times, daily contract reference prices for at least one expiration or settlement date that is five months or more from the date the determination is made, as well as for all expiration or settlement dates during such five-month period.

 

For a contract to be eligible for inclusion in the S&P GSCI, volume data with respect to such contract must be available for at least the three months immediately preceding the date on which the determination is made.

 

A contract that is:

 

 

 

In the event that two or more contracts on the same commodity satisfy the eligibility criteria,

 

 

The contracts currently included in the S&P GSCI are all futures contracts traded on the NYMEX, the LME, the IntercontinentalExchange ( ICE ) Futures U.S. (ICE-US), ICE Futures Europe (ICE-UK), (IPE), the Chicago Mercantile Exchange (CME), the Chicago Board of Trade (CBT), the Kansas City Board of Trade (KBT) and the Commodities Exchange Inc. (CMX).

The futures contracts currently included in the S&P GSCI, their percentage dollar weights ( PDW ), their market symbols, the exchanges on which they are traded and their contract production weights for 2008 are:

 

 

 

 

The quantity of each of the contracts included in the S&P GSCI is determined on the basis of a five-year average (referred to as the “world production average”) of the production quantity of the underlying commodity as published by the United Nations Statistical Yearbook, the Industrial Commodity Statistics Yearbook and other official sources. However, if a commodity is primarily a regional commodity, based on its production, use, pricing, transportation or other factors, S&P, in consultation with the Policy Committee, may calculate the weight of such commodity based on regional, rather than world, production data. At present, natural gas is the only commodity the weights of which are calculated on the basis of regional production data, with the relevant region defined as North America.

 

The five-year moving average is updated annually for each commodity included in the S&P GSCI, based on the most recent five-year period (ending approximately two years prior to the date of calculation and moving backwards) for which complete data for all commodities is available. The contract production weights, or CPWs, used in calculating the GSCI are derived from world or regional production averages, as applicable, of the relevant commodities, and are calculated based on the total quantity traded for the relevant contract and the world or regional production average, as applicable, of the underlying commodity. However, if the volume of trading in the relevant contract, as a multiple of the production levels of the commodity, is below specified thresholds, the CPW of the contract is reduced until the threshold is satisfied. This is designed to ensure that trading in each such contract is sufficiently liquid relative to the production of the commodity.

In addition, S&P performs this calculation on a monthly basis and, if the multiple of any contract is below the prescribed threshold, the composition of the S&P GSCI is reevaluated, based on the criteria and weighting procedure described above. This procedure is undertaken to allow the S&P GSCI to shift from contracts that have lost substantial liquidity into more liquid contracts, during the course of a given year. As a result, it is possible that the composition or weighting of the S&P GSCI will change on one or more of these monthly evaluation dates. In addition, regardless of whether any changes have occurred during the year, S&P reevaluates the composition of the S&P GSCI, in consultation with the Policy Committee, at the conclusion of each year, based on the above criteria. Other commodities that satisfy such criteria, if any, will be added to the S&P GSCI. Commodities included in the S&P GSCI which no longer satisfy such criteria, if any, will be deleted.

 

Standard & Poor’s, in consultation with the Policy Committee, also determines whether modifications in the selection criteria or the methodology for determining the composition and weights of and for calculating the S&P GSCI are necessary or appropriate in order to assure that the S&P GSCI represents a measure of commodity market performance. Standard & Poor’s has the discretion to make any such modifications, in consultation with the Policy Committee. Upon request, S&P will disclose to any investor any such modifications that are made. Requests should be directed to the calculation agent at the following address: 55 Water Street, New York, NY 10041.

 

Contract expirations

 

Because the S&P GSCI comprises actively traded contracts with scheduled expirations, it can only be calculated by reference to the prices of contracts for specified expiration, delivery or settlement periods, referred to as “contract expirations”. The contract expirations included in the S&P GSCI for each commodity during a given year are designated by S&P, in consultation with the Policy Committee, provided that each such contract must be an “active contract”. An “active contract” for this purpose is a liquid, actively traded contract expiration, as defined or identified by the relevant trading facility or, if no such definition or identification is provided by the relevant trading facility, as defined by standard custom and practice in the industry.

 

If a trading facility deletes one or more contract expirations, the S&P GSCI will be calculated during the remainder of the year in which such deletion occurs on the basis of the remaining contract expirations designated by S&P. If a trading facility ceases trading in all contract expirations relating to a particular contract, S&P may designate a replacement contract on the commodity. The replacement contract must satisfy the eligibility criteria for inclusion in the S&P GSCI. To the extent practicable, the replacement will be effected during the next monthly review of the composition of the S&P GSCI. If that timing is not practicable, S&P will determine the date of the replacement and will consider a number of factors, including the differences between the existing contract and the replacement contract with respect to contractual specifications and contract expirations.

 

Value of the S&P GSCI

 

The value of the S&P GSCI on any given day is equal to the total dollar weight of the S&P GSCI divided by a normalizing constant that assures the continuity of the S&P GSCI over time. The total dollar weight of the S&P GSCI is the sum of the dollar weights of each of the underlying commodities. The dollar weight of each such commodity on any given day is equal to:

 

 

The daily contract reference price used in calculating the dollar weight of each commodity on any given day is the most recent daily contract reference price made available by the relevant trading facility, except that the daily contract reference price for the most recent prior day will be used if the exchange is closed or otherwise fails to publish a daily contract reference price on that day. In addition, if the trading facility fails to make a daily contract reference price available or publishes a daily contract reference price that, in the reasonable judgment of S&P, reflects manifest error, the relevant calculation will be delayed until the price is made available or corrected; provided that, if the price is not made available or corrected by 4:00 P.M. New York City time, S&P may, if it deems

such action to be appropriate under the circumstances, determine the appropriate daily contract reference price for the applicable futures contract in its reasonable judgment for purposes of the relevant S&P GSCI calculation.

 

Contract daily return

 

The contract daily return on any given day is equal to the sum, for each of the commodities included in the S&P GSCI, of the applicable daily contract reference price on the relevant contract multiplied by the appropriate CPW and the appropriate “roll weight”, divided by the total dollar weight of the S&P GSCI on the preceding day, minus one.

 

The world-production weighting of the S&P GSCI is accomplished by keeping the quantity weights of the individual commodities within each basket proportional to world production weights, which are averages of historical production levels and are generally updated every year.

 

If on any day during a roll period any of the following conditions exists, the portion of the roll that would have taken place on that day is deferred until the next day on which such conditions do not exist:

 

 

If any of these conditions exist throughout the roll period, the roll with respect to the affected contract will be effected in its entirety on the next day on which such conditions no longer exist.

 

Valuation of the S&P GSCI Excess Return Index

 

The value of the S&P GSCI Excess Return Index on any S&P GSCI business day is equal to the product of (i) the value of the S&P GSCI on the immediately preceding S&P GSCI business day, multiplied by (ii) one plus the contract daily return on the S&P GSCI business day on which the calculation is made. The value of the S&P GSCI has been normalized so that its hypothetical level on January 2, 1970 was 100.

 

As discussed above under “— Value of the GSCI Agriculture Excess Return Index” and “— Value of the GSCI Livestock Excess Return Index”, the GSCI Agriculture Index and the GSCI Livestock Index are a sub-indices of the S&P GSCI Excess Return Index and are constructed and valued in the same way as the S&P GSCI Excess Return Index, except that they are specifically limited to the futures relating to either the agricultural commodities in the S&P GSCI or the livestock commodities in the S&P GSCI, respectively. The performance of the S&P GSCI Excess Return Index as a whole will not affect the return of your notes.

 

Historical closing levels of the GSCI Agriculture Excess Return Index

 

Since its inception, the GSCI Agriculture Index has experienced significant fluctuations. Any historical upward or downward trend in the closing level of the GSCI Agriculture Index during any period shown below is not an indication that the closing level of the GSCI Agriculture Index is more or less likely to increase or decrease at any time during the term of the notes. The historical levels of the GSCI Agriculture Index do not give an indication of future performance of the GSCI Agriculture Index. We cannot make any assurance that the future performance of the GSCI Agriculture Index will result in holders of the notes receiving a positive total return on their investment.

 

We obtained the closing levels of the GSCI Agriculture Index listed below from Bloomberg Financial Markets without independent verification. Bloomberg Financial Markets only provides closing levels for the GSCI Agriculture Index as a value rounded to the second decimal place rather than reporting the full four decimal

number. The actual level of the GSCI Agriculture Index at or near maturity of the notes may bear little relation to the historical levels shown below.

 

The following table sets forth the published high and low closing levels of the GSCI Agriculture Index as well as closing levels of the GSCI Agriculture Index at the end of each quarter from January 1, 2004 through March 31, 2008 and the period from April 1, 2008 through April 14, 2008. On April 14, 2008, the closing level of the GSCI Agriculture Index was 89.768. This historical data on the GSCI Agriculture Index is not indicative of the future levels of the GSCI Agriculture Index or what the market value of the notes may be. Any historical upward or downward trend in the level of the GSCI Agriculture Index during any period set forth below is not any indication that the level of the GSCI Agriculture Index is more or less likely to increase or decrease at any time during the term of the notes.

 

 

Historical closing levels of the GSCI Livestock Excess Return Index

 

Since its inception, the GSCI Livestock Index has experienced significant fluctuations. Any historical upward or downward trend in the closing level of the GSCI Livestock Index during any period shown below is not an indication that the closing level of the GSCI Livestock Index is more or less likely to increase or decrease at any time during the term of the notes. The historical levels of the GSCI Livestock Index do not give an indication of future performance of the GSCI Livestock Index. We cannot make any assurance that the future performance of the GSCI Livestock Index will result in holders of the notes receiving a positive total return on their investment.

 

We obtained the closing levels of the GSCI Livestock Index listed below from Bloomberg Financial Markets without independent verification. Bloomberg Financial Markets only provides closing levels for the GSCI Livestock Index as a value rounded to the second decimal place rather than reporting the full four decimal number. The actual level of the GSCI Livestock Index at or near maturity of the notes may bear little relation to the historical levels shown below.

The following table sets forth the published high and low closing levels of the GSCI Livestock Index as well as closing levels of the GSCI Livestock Index at the end of each quarter from January 1, 2004 through March 31, 2008 and the period from April 1, 2008 through April 14, 2008. On April 14, 2008, the closing level of the GSCI Livestock Index was 285.866. This historical data on the GSCI Livestock Index is not indicative of the future levels of the GSCI Livestock Index or what the market value of the notes may be. Any historical upward or downward trend in the level of the GSCI Livestock Index during any period set forth below is not any indication that the level of the GSCI Livestock Index is more or less likely to increase or decrease at any time during the term of the notes.

 

 

License agreement

 

We expect to into a non-exclusive license agreement with Standard & Poor’s, a division of The McGraw-Hill Companies ( S&P or Standard & Poor’s ), which allows us and our affiliates, in exchange for a fee, to use the component index in connection with the issuance of certain securities, including the notes. We are not affiliated with Standard & Poor’s; the only relationship between Standard & Poor’s and us is the licensing of the use of the component index and trademarks relating to the component index.

 

Standard & Poor’s is under no obligation to continue the calculation and dissemination of the component index. The notes are not sponsored, endorsed, sold or promoted by Standard & Poor’s. No inference should be drawn from the information contained in this pricing supplement that Standard & Poor’s makes any representation or warranty, implied or express, to us, any holder of the notes or any member of the public regarding the advisability of investing in securities generally or in the notes in particular or the ability of the component index to track general commodity market performance.

 

Standard & Poor’s determines, composes and calculates the component index without regard to the notes. Standard & Poor’s has no obligation to take into account your interest, or that of anyone else having an interest, in the notes in determining, composing or calculating the component index. Standard & Poor’s is not responsible for, and has not participated in the determination of, the terms, prices or amount of the notes and will not be responsible for, or participate in, any determination or calculation regarding the principal amount of the notes payable at maturity. Standard & Poor’s has no obligation or liability in connection with the administration, marketing or trading of the notes.

 

Standard & Poor’s disclaims all responsibility for any errors or omissions in the calculation and dissemination of the component index or the manner in which the component index is applied in determining the initial basket level or the final basket level or any amount payable upon maturity of the notes.

 

Standard & Poor’s ^® , S&P ^® , and S&P GSCI ^® are trademarks of The McGraw-Hill Companies, Inc. These marks have been licensed for use by Eksportfinans. The notes are not sponsored, endorsed, sold or promoted by

Standard & Poor’s and Standard & Poor’s makes no representation regarding the advisability of investing in the notes.

 

The notes are not sponsored, endorsed, sold or promoted by S&P. Standard & Poor’s makes no representation or warranty, express or implied, to the owners of the notes or any member of the public regarding the advisability of investing in securities generally or in the notes particularly or the ability of the S&P GSCI Excess Return Index to track general commodity market performance. Standard & Poor’s only relationship to us is the licensing of the GSCI Agriculture and the GSCI Livestock indices, which is determined, composed and calculated by S&P without regard to us or the notes. Standard & Poor’s has no obligation to take the needs of us or the owners of the notes into consideration in determining, composing or calculating the GSCI Agriculture and the GSCI Livestock indices. Standard & Poor’s is not responsible for and has not participated in the determination of the timing of, prices at, or quantities of the notes to be issued or in the determination or calculation of the equation by which the notes are to be converted into cash. Standard & Poor’s has no obligation or liability in connection with the administration, marketing or trading of the notes.

 

STANDARD & POOR’S DOES NOT GUARANTEE THE QUALITY, ACCURACY AND/OR THE COMPLETENESS OF THE S&P GSCI EXCESS RETURN INDEX OR ANY DATA INCLUDED THEREIN AND STANDARD & POOR’S SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. STANDARD & POOR’S MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY US, OWNERS OF THE NOTES, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE S&P GSCI EXCESS RETURN INDEX OR ANY DATA INCLUDED THEREIN. STANDARD & POOR’S MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE S&P GSCI EXCESS RETURN INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL STANDARD & POOR’S HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

 

The component commodities

 

The commodities markets

 

The closing prices of the component commodities are determined by reference to the official cash settlement prices of futures and forwards contracts traded on the NYMEX and the LME. The following discussion of the operation of the exchanges or markets on which the component commodities trade is based on publicly available information and is provided for informational purposes only. You should make your own investigation into the component commodities and the NYMEX and LME to determine whether the notes are a suitable investment for you.

 

The NYMEX

 

The NYMEX, located in New York City, is the world’s largest physical commodities futures exchange and a leading trading forum for energy and precious metals. NYMEX began commodities trading in 1872, organized as the Butter and Cheese Exchange of New York, and has since traded a variety of commodity products. The establishment of energy futures on the NYMEX occurred in 1978, with the introduction of heating oil futures contracts. NYMEX opened trading in leaded gasoline futures in 1981, followed by the crude oil futures contract in 1983 and unleaded gasoline futures in 1984.

 

The LME

 

The LME was established in 1877 and is the principal non-ferrous metal exchange in the world on which contracts for delivery of copper, among other metals, are traded. In contrast to U.S. futures exchanges, the LME operates as a principals’ market for the trading of forward contracts, and is therefore more closely analogous to over-the-counter physical commodity markets than futures markets. As a result, members of the LME trade with each other as principals and not as agents for customers, although such members may enter into offsetting “back-to-

back” contracts with their customers. In addition, while futures exchanges permit trading to be conducted in contracts for monthly delivery in stated delivery months, historically LME contracts used to be established for daily delivery (referred to as a “prompt date”) from one day to three months following the date of contract, the average amount of time it took a ship to sail from certain Commonwealth countries to London. Currently, LME contracts may be established for monthly delivery from the seventh month following the date of such contract up to 63, 27 and 15 months forward (depending on the commodity underlying the contract). Further, because it is a principals’ forward market, there are no price limits applicable to LME contracts, and prices could decline without limitation over a period of time. Trading is conducted on the basis of warrants that cover physical material held in listed warehouses.

 

The LME is not a cash cleared market. Both inter-office and floor trading are cleared and guaranteed by a system run by the London Clearing House, whose role is to act as a central counterparty to trades executed between clearing members and thereby reduce risk and settlement costs. The LME is subject to regulation by the Financial Services Authority in the United Kingdom.

 

The bulk of trading on the LME is transacted through inter-office dealing which allows the LME to operate as a 24- hour market. Trading on the floor takes place in two sessions daily, from 11:45 a.m. to 1:15 p.m. and from 3:10 p.m. to 4:35 p.m., London time. The two sessions are each broken down into two rings made up of five minutes’ trading in each contract. After the second ring of the first session the official prices for the day are announced. In addition to the ring trading and telephone markets, an official exchange operated electronic trading platform is available. Contracts may be settled by offset or delivery and can be cleared in U.S. dollars, pounds sterling, Japanese yen and euros.

 

Copper has traded on the LME since its establishment. The copper contract was upgraded to high grade copper in November 1981 and again to today’s Grade-A contract which began trading in June 1986. The LME share (by weight) of world terminal market trading is over 90% of all copper.

 

Copper

 

The closing price of copper is determined by reference to the official U.S. dollar settlement price per ton of copper Grade A on the LME for cash delivery. The price of copper is primarily affected by the global demand for and supply of copper.

 

Demand for copper is significantly influenced by the level of global industrial economic activity. Industrial sectors which are particularly important include the electrical and construction sectors. In recent years demand has been supported by strong consumption from newly industrializing countries, which continue to be in a copper-intensive period of economic growth as they develop their infrastructure. An additional, but highly volatile, component of demand is adjustments to inventory in response to changes in economic activity and/or pricing levels.

 

Apart from the United States, Canada and Australia, the majority of copper concentrate supply (the raw material) comes from outside the Organization for Economic Cooperation and Development countries. Chile is the largest producer of copper concentrate. In previous years, copper supply has been affected by strikes, financial problems and terrorist activity. Output has fallen particularly sharply in the “African Copperbelt” and in Bougainville, Papua New Guinea.

 

Coal

 

The closing price of coal is the specified price per ton of steam coal, 6,000 kcal/kg, up to 1.00% sulphur NAR basis, cif ARA, stated in U.S. Dollars, which is published under the heading “International Coal Indexes incorporating the TFS APITM Indices: Monthly Coal Price Indexes: TFS API 2 (cif ARA)” in the issue of Argus/McCloskey’s Coal Price Index Report that reports prices effective on the pricing date.

 

The price of coal is affected by the global demand for and supply of coal. Due to the importance of coal in the generation of electricity and the production of iron and steel, the electric and steel industries account for a significant percentage of coal demand. Nuclear power, natural gas, hydro-electric power, wind and solar power and crude oil can be used as substitutes for coal, and the availability and price of each of these alternative energy sources

also affects demand for coal. Government regulations regarding air pollution affect the demand for coal, and, specifically, the demand for specific types of coal, by limiting the amount of sulfur dioxide which may be emitted during the use of coal. Other factors that affect the price of coal include weather patterns, discoveries of new coal deposits, labor and equipment costs, environmental, health and safety and other government regulations, including the regulation of mines, government subsidies and tax incentives, and transportation disruptions.

 

WTI Crude Oil

 

The closing price of WTI crude oil is determined by reference to the U.S. dollar settlement price per barrel of West Texas Intermediate light sweet crude oil on the NYMEX of the first nearby futures contract.

 

Although WTI crude oil is refined principally in the United States’ mid-continent region, it forms the basis for pricing other domestic crudes as well as some foreign grades. The WTI spot price, in turn, is usually determined by global (rather than regional) supply and demand conditions due to the availability of product and crude oil pipelines that link the mid-continent to the Gulf Coast, a major crude oil trading and refining center.

 

Demand for petroleum products by consumers, as well as agricultural, manufacturing and transportation industries, determines demand for crude oil by refiners. Since the precursors of product demand are linked to economic activity, crude oil demand will tend to reflect economic conditions. However, other factors such as weather will also influence crude oil demand.

 

Crude oil supply is determined by both economic and political factors. Oil prices (along with drilling costs, availability of attractive prospects for drilling, taxes and technology) determine exploration and development spending which influence output capacity with a lag. In the short run, production decisions by the Organization of Petroleum Exporting Countries also affect supply and prices. Oil export embargoes and the current conflict in Iraq represent other routes through which political developments move the market.

Historical prices of the basket components

 

The following tables set forth the published high and low closing prices of the basket components as well as the closing prices of the basket components at the end of each quarter from January 1, 2004 through March 31, 2008 and the period from April 1, 2008 through April 14, 2008. On April 14, 2008, the closing prices of coal, copper and WTI crude oil were $136.100, $8,679.500 and $111.990, respectively. Any historical upward or downward trend in the prices of the basket components during any period set forth below is not any indication that the prices of the basket components is more or less likely to increase or decrease at any time during the term of the notes. We obtained the closing prices set forth in the tables below from Bloomberg Financial Products, without independent verification.

 

Coal

 

 

Copper

 

WTI Crude Oil

 

 

TAXATION IN THE UNITED STATES

 

[The following is a general description of certain United States federal income tax considerations relating to the notes. The following does not purport to be complete analysis of all tax considerations relating to the notes. Prospective purchasers of the notes should consult their tax advisors as to the consequences under the tax laws of the country of which they are resident for tax purposes and the tax laws of the United States of acquiring, holding and disposing of the notes and receiving payments under the notes. This summary is based on the law as in effect on the date of this pricing supplement and is subject to any changes in law that may take effect after such date. This summary does not address all aspects of United States federal income taxation of the notes that may be relevant to you in light of your particular circumstances, nor does it address all of our tax consequences if you are a holder of notes who is subject to special treatment under the United States federal income tax laws.

 

The following discussion supplements and should be read together with the discussion in the prospectus supplement and the prospectus under “Taxation in the United States” and is subject to the limitations and exceptions set forth therein. Unless otherwise noted, this discussion is only applicable to you if you are a U.S. Holder (as defined in the accompanying prospectus). The following discussion represents the opinion of Allen & Overy LLP and does not address all U.S. Federal income tax matters that may be relevant to a particular prospective holder. Prospective holder should consult their own tax advisers as to the consequences of acquiring, holding and disposing of securities under the tax laws of the country of which they are resident for tax purposes as well of under the laws of any state, local or foreign jurisdiction.

 

The notes will be treated as debt instruments subject to special rules governing contingent payment debt obligations for United States federal income tax purposes. Under those rules, the amount of interest you are required to take into account for each accrual period will be determined by constructing a projected payment schedule for the notes, and applying the rules similar to those for accruing original issue discount ( OID ) on a hypothetical noncontingent debt instrument with that projected payment schedule (such method is referred to as the noncontingent bond method ). This method is applied by first determining the yield at which we would issue a noncontingent fixed rate debt instrument with terms and conditions similar to the notes (the comparable yield ) and then determining a payment schedule (the Schedule ) as of the issue date that would produce the comparable yield. These rules will generally have the effect of requiring you to include amounts in income in respect of the notes prior to your receipt of cash attributable to that income.

 

The amount of interest that you will be required to include in income in each accrual period for the notes will equal the product of the adjusted issue price for the notes at the beginning of the accrual period and the comparable yield for the notes. The adjusted issue price of the notes will equal the original offering price for the notes plus any interest that has accrued on the notes (under the rules governing contingent payment debt obligations). You will be required to ratably allocate this amount to each day in the accrual period and include in taxable income as ordinary interest income for each day in the accrual period on which you hold the notes.

 

We have determined that the comparable yield for the notes is equal to [ • ]% per annum, compounded semi-annually. We have also determined that the projected payment for the notes, per $1,000.00 of principal amount, at the maturity date is $[ • ] (which includes the stated principal amount as well as the final projected payment).

 

If the amount you receive at maturity is greater than $[ • ], you would be required to increase the amount of ordinary income that you recognize by an amount that is equal to such excess. Conversely, if the amount you receive at maturity is less $[ • ], you would be required to make an adjustment as described below under “Treatment upon Sale or Maturity”.

 

You are required to use the comparable yield and projected payment schedule above in determining your interest accruals in respect of the notes, unless you timely disclose and justify on your federal income tax return the use of a different comparable yield and projected payment schedule. Pursuant to applicable Treasury regulations, we are required to provide both the comparable yield and the projected payment schedule, along with a description of a certain other terms of the notes, to the Internal Revenue Service (IRS).

 

The comparable yield and the projected payment schedule are not provided to you for any purpose other than the determination of your interest accruals in respect of the notes for tax purposes only, and we make no representations or assurances regarding the amount of contingent payments with respect to the notes. Any Form 1099-OID accrued interest will be based on such comparable yield and projected payment schedule.

If you purchase the notes for an amount that differs from the notes’ adjusted issue price at the time of the purchase, you must determine the extent to which the difference between the price you paid for your notes and their adjusted issue price is attributable to a change in expectations as to the projected payment schedule, a change in interest rates, or both, and allocate the difference accordingly.

 

If you purchase the notes for an amount that is less than the adjusted issue price of the notes, you must (a) make positive adjustments increasing the amount of interest that you would otherwise accrue and include in income each year to the extent of amounts allocated to a change interest rate and (b) make positive adjustments increasing the amount of ordinary income (or decreasing the amount of loss) that you would otherwise recognize on the maturity of the notes to the extend of amounts allocated to a change in expectations as the projected payment schedule. If you purchase the notes for an amount that is greater than the adjusted issue price of the notes, you must (a) make negative adjustments decreasing the amount of interest that you would otherwise accrue and include in income each year to the extent of amount allocated to a change in interest rates and (b) make negative adjustment decreasing the amount of ordinary income (or increasing the amount of loss) that you would otherwise recognize the notes to the extent of amounts allocated to a change in expectation as to the projected payment schedule. Adjustments allocated to the interest amount are not made until the date the daily portion of interest accrues.

 

Because any Form 1099-OID that you receive will not reflect the effects of positive or negative adjustments resulting from your purchase of the notes at a price other than the adjusted issue price determined for tax purposes, you are urged to consult with your tax advisor as to whether and how adjustments should be made to the amounts reported on any Form 1099-OID.

 

Treatment Upon Sale or Maturity.   You will recognize gain or loss on the sale or maturity of the notes in an amount equal to the difference, if any, between the amount of cash you receive at the time and your adjusted basis in the notes. In general, your adjusted basis in the notes will equal the amount you paid for the notes increased by the amount of interest you previously accrued with respect to the notes (in accordance with the comparable yield for the notes), and increased or decreased by the amount of any positive or negative adjustment that you are required to make with respect to your notes under the rules set forth above.

 

Any gain you may recognize on the sale or maturity of the notes will be ordinary interest income. Any loss you may recognize upon the sale of the notes will be ordinary loss to the extent of the interest you included as income in the current or previous taxable years in respect of the notes, and thereafter will be capital loss. If you hold your notes until maturity and the maturity payment is less than the projected payment at maturity, the difference will first reduce interest that would otherwise accrue in respect of the notes in such taxable year, and any remainder will be ordinary loss to the extent of the interest you previously accrued as income in respect of the notes, and thereafter will be capital loss. The deductibility of capital losses is limited.]

 

USE OF PROCEEDS AND HEDGING

 

The net proceeds from the sale of the notes will be used as described under “Use of Proceeds” in the accompanying prospectus and to hedge market risks of Eksportfinans associated with its obligation to pay the redemption amount at the maturity of the notes.

 

The hedging activity discussed above may adversely affect the market value of the notes from time to time and the redemption amount you will receive on the notes at maturity. See “Risk Factors — Hedging transactions may affect the return on the notes” and “Risk Factors — Potential conflicts of interest could arise” for a discussion of these adverse effects.

 

SUPPLEMENTAL PLAN OF DISTRIBUTION

 

The notes are being purchased by Wachovia Capital Markets, LLC (the agent ) as principal, pursuant to a terms agreement dated as of [ • ] between the agent and us. The agent has agreed to pay our out-of-pocket expenses of the issue of the notes.

 

From time to time, the agent and its affiliates have engaged, and in the future may engage, in transactions with and performance of services for us for which they have been, and may be, paid customary fees. In particular, an affiliate of the agent is our swap counterparty for a hedge of our obligation under the notes.

In the future, the agent and its affiliates may repurchase and resell the offered notes in market-making transactions, with resales being made at prices related to prevailing market prices at the time of resale or at negotiated prices.

 

The agent named below has committed to purchase all of those notes if any are purchased. Under certain circumstances, the commitments of non-defaulting underwriters may be increased.

 

 

The agent named above proposes to offer the notes in part directly to the public at the initial maximum offering price set forth on the cover page of this pricing supplement and in part to Wachovia Securities, LLC, Wachovia Securities Financial Network, LLC or certain securities dealers at such prices less a selling concession not to exceed $[ • ] per note.

 

Proceeds to be received by Eksportfinans in this offering will be net of the underwriting discount, commission and expenses payable by Eksportfinans.

 

After the notes are released for sale in the public, the offering prices and other selling terms may from time to time be varied by the agent.

 

The notes are new issues of notes with no established trading markets. We have been advised by the agent that the agent intends to make a market in the notes but is not obligated to do so and may discontinue market making at any time without notice. No assurance can be given as to the liquidity of the trading market for the notes.

 

Settlement for the notes will be made in immediately available funds. The notes will be in the Same Day Funds Settlement System at DTC and, to the extent the secondary market trading in the notes is effected through the facilities of such depositary, such trades will be settled in immediately available funds.

 

Eksportfinans has agreed to indemnify the agent against certain liabilities, including liabilities under the Securities Act of 1933.

 

This pricing supplement and the attached prospectus and prospectus supplement may be used by Wachovia Capital Markets, LLC or an affiliate of Wachovia Capital Markets, LLC, in connection with offers and sales related to market-making or other transactions in the notes. Wachovia Capital Markets, LLC or an affiliate of Wachovia Capital Markets, LLC, may act as principal or agent in such transactions. Such sales will be made at prices related to prevailing market prices at the time of sale or otherwise.

 

From time to time the agent engages in transactions with Eksportfinans in the ordinary course of business. The agent has performed investment banking services for Eksportfinans in the last two years and has received fees for these services.

 

Wachovia Capital Markets, LLC, as agent, may engage in over-allotment, stabilizing transactions, syndicate covering transactions and penalty bids in accordance with Regulation M under the Securities Exchange Act of 1934. Over-allotment involves syndicate sales in excess of the offering size, which creates a syndicate short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. Syndicate covering transactions involve purchases of the notes in the open market after the distribution has been completed in order to cover syndicate short positions. Penalty bids permit reclaiming a selling concession from a syndicate member when the notes originally sold by such syndicate member are purchased in a syndicate covering transaction to cover syndicate short positions. Such stabilizing transactions, syndicate covering transactions and penalty bids may cause the price of the notes to be higher than it would otherwise be in the absence of such transactions.

 

No action has been or will be taken by Eksportfinans, the agent or any broker-dealer affiliates of either Eksportfinans or the agent that would permit a public offering of the notes or possession or distribution of this pricing supplement or the accompanying prospectus in any jurisdiction, other than the United States, where action for that purpose is required. No offers, sales or deliveries of the notes, or distribution of this pricing supplement or the accompanying prospectus supplement and prospectus, may be made in or from any jurisdiction except in circumstances which will result in compliance with any applicable laws and regulations and will not impose any obligations on Eksportfinans, the underwriters or any broker-dealer affiliates of either Eksportfinans or the agent.

SUMMARY

      This summary highlights information contained elsewhere in this prospectus supplement and in the prospectus. It does not contain all the information that you should consider before investing in the notes. You should carefully read the pricing supplement and any applicable product supplement relating to the terms and conditions of a particular issue of notes along with this entire prospectus supplement and the prospectus, including information incorporated by reference.

RATIOS OF EARNINGS TO FIXED CHARGES

      The following table shows our unaudited historical ratios of earnings to fixed charges for the periods indicated, computed in accordance with Norwegian GAAP and U.S. GAAP.