Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that it has been notified by Mobile TeleSystems Finance S.A. (“MTS Finance”), a wholly owned subsidiary of MTS, that The Bank of New York Mellon (“BNY”), in its capacity as trustee under 8.00% notes due January 28, 2012 issued by MTS Finance (the “Notes”), failed to transfer to holders of the Notes, on behalf of MTS Finance, interest payments that were due and payable under the Notes on January 28, 2011 (the “Interest Payments”), despite MTS Finance having transferred to BNY US$16 million on January 25, 2011, for this express purpose and in accordance with its established business practice in respect of the Notes.

As previously announced, MTS Finance has been notified of a freezing order issued by the English High Court of Justice on January 26, 2011 (the “Order”), and BNY refused to make the Interest Payments on January 28, 2011 until it is able to confirm that the Order does not prevent such payment. MTS Finance is working to ensure that the Interest Payments are paid to holders of the Notes promptly.