Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the largest mobile phone operator in Russia and the CIS, announces that it has reached an agreement with Sberbank to lower the interest rates on RUB 59 billion in financing raised in August and September 2009¹.

The interest rate on the RUB 47 billion loan with maturity in September 2013 was reduced from an annual rate of 16% by 4.25 percentage points to 11.75%. The fixed annual interest rate of 15% on the RUB 12 billion loan with a two-year maturity will be changed to a floating interest rate, defined as the refinancing rate set by the Central Bank of Russia, which is currently² at 8.75% plus a fixed margin of 2.25%.

The changes to the terms of the financing came into effect on December 28, 2009.

"Improving the terms of our financing is inline with the Company’s overall strategy to optimize the structure of its debt portfolio. We positively view the introduced changes as they are reflective of both the strengthening cooperation with Sberbank and the developments in the capital markets," commented Mr. Alexey Kornya, acting Vice President and Chief Financial Officer of MTS.

¹ Additional information on the loans can be found at https://www.mtsgsm.com/news/2009-09-28-27763.

² As of January 14, 2010.