The loan facility has a tenor of seven years repayable from December 15, 2005 on a biannual basis in equal installments. Interest is 3.1% over LIBOR. The proceeds of the loan will be used by MTS to finance investments in Russia’s regions (primarily outside of Moscow and St. Petersburg).

Commenting on the new credit facility, Tatiana Evtushenkova, MTS’ Vice President for Investment and Corporate Development, said: “With this loan, the EBRD is supporting MTS’ effort to develop the telecommunications infrastructure in the regions of Russia where networks have not yet been established and where phones are still something of a rarity. This substantial long-term facility highlights MTS’ investment record and the EBRD’s commitment to Russia. It also confirms the Company’s strategy to increase the maturity profile of its debt and decrease its cost.”