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					                                                                  U.S.$10,000,000,000
                                                Programme for the Issuance of Loan Participation Notes
                                                     to be issued by, but with limited recourse to,
                                                                   SB Capital S.A.
                                                         for the purpose of financing loans to
                                                                       Sberbank
Under the programme for the issuance of Loan Participation Notes (the ‘‘Programme’’) described in this base prospectus (the ‘‘Base Prospectus’’), SB Capital S.A. (the
‘‘Issuer’’), subject to compliance with all relevant laws, regulations and directives, may from time to time issue loan participation notes (the ‘‘Notes’’) on the terms set out
herein, as supplemented by a final terms supplement (each such final terms supplement ‘‘Final Terms’’) setting out the specific terms of each issue. The aggregate principal
amount of Notes outstanding will not at any time exceed U.S.$10,000,000,000 (or the equivalent in other currencies). Notes will be issued in Series (as defined in ‘‘Overview
of the Programme’’) and the sole purpose of issuing each Series will be to finance either a senior loan (a ‘‘Senior Loan’’) or a subordinated loan (a ‘‘Subordinated Loan’’ and,
together with a Senior Loan, the ‘‘Loans’’ and each a ‘‘Loan’’) to Sberbank (‘‘Sberbank’’ or the ‘‘Borrower’’) as borrower, on the terms of either: (i) in relation to a Senior
Loan, a facility agreement between the Issuer and Sberbank dated May 12, 2006 (such facility agreement, the ‘‘Facility Agreement’’) as amended and supplemented by a loan
supplement to be dated each Trade Date (as defined in the Trust Deed) of the relevant Series (the ‘‘Loan Supplement’’ and, together with the Facility Agreement, the ‘‘Senior
Loan Agreement’’), or (ii) in relation to a Subordinated Loan, a subordinated loan agreement to be entered into between the Issuer and Sberbank as amended and
supplemented by a subordinated loan supplement, each to be dated on or before the Trade Date of the relevant Series (the ‘‘Subordinated Loan Agreement’’) which it is
anticipated will be substantially in the form set out in ‘‘Form of Subordinated Loan Agreement,’’ subject to modifications, amendments and supplements to be agreed at such
time. In this Base Prospectus, ‘‘Loan Agreement’’ shall mean either (i) a Senior Loan Agreement (in respect of a Senior Loan) or (ii) a Subordinated Loan Agreement (in
respect of a Subordinated Loan), as applicable. The relevant Final Terms in respect of the issue of any Series of Notes will specify whether a Loan being financed by such
Series of Notes is a Senior Loan (such Series of Notes being a ‘‘Senior Series’’) or a Subordinated Loan (such Series of Notes being a ‘‘Subordinated Series’’). Subject as
provided in the Trust Deed (as defined herein) the Issuer will (a) charge, in favour of J.P. Morgan Corporate Trustee Services Limited as trustee (the ‘‘Trustee’’), by way of
a first fixed charge as security for its payment obligations in respect of each Series of Notes and under the Trust Deed, certain of its rights and interests under the relevant
Loan Agreement and the relevant Account (as defined in the relevant Loan Supplement or the Subordinated Loan Agreement, as the case may be), but excluding any
Reserved Rights (as defined in the ‘‘Terms and Conditions of the Notes’’), and (b) assign, in favour of the Trustee, certain of its other rights under the relevant Loan
Agreement, but excluding any Reserved Rights (as defined in the ‘‘Terms and Conditions of the Notes’’), in each case for the benefit of the holders of the corresponding Series
of Notes (the ‘‘Noteholders’’), all as more fully described under ‘‘Overview of the Programme.’’
In each case where amounts of principal, interest and additional amounts (if any) are stated to be payable in respect of a Series of Notes, the obligation of the Issuer to make
any such payment constitutes an obligation only to account to the Noteholders, on each date upon which such amounts of principal, interest and additional amounts (if any)
are due in respect of such Series of Notes, for an amount equivalent to all principal, interest and additional amounts (if any) actually received from Sberbank by or for the
account of the Issuer pursuant to the relevant Loan Agreement. The Issuer will have no other financial obligation under the Notes. Noteholders will be deemed to have
accepted and agreed that they will be relying solely on the credit and financial standing of Sberbank in respect of the payment obligations of the Issuer under the Notes.
AN INVESTMENT IN THE NOTES INVOLVES A HIGH DEGREE OF RISK. PROSPECTIVE INVESTORS SHOULD HAVE REGARD TO THE FACTORS
DESCRIBED UNDER THE SECTION ENTITLED ‘‘RISK FACTORS’’ IN THIS BASE PROSPECTUS.
THE NOTES AND THE CORRESPONDING LOANS HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933
(THE ‘‘SECURITIES ACT’’), AS AMENDED AND, SUBJECT TO CERTAIN EXCEPTIONS, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT (‘‘REGULATION S’’)).
THE NOTES MAY BE OFFERED AND SOLD (I) WITHIN THE UNITED STATES TO QUALIFIED INSTITUTIONAL BUYERS (‘‘QIBS’’), AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT (‘‘RULE 144A’’), THAT ARE ALSO QUALIFIED PURCHASERS (‘‘QPS’’), AS DEFINED IN SECTION 2(A)(51) OF
THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE ‘‘INVESTMENT COMPANY ACT’’) IN RELIANCE ON THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144A (THE ‘‘RULE 144A NOTES’’) AND (II) TO NON-U.S. PERSONS IN OFFSHORE TRANSACTIONS IN RELIANCE
ON REGULATION S (THE ‘‘REGULATION S NOTES’’). THE ISSUER HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE INVESTMENT
COMPANY ACT. PROSPECTIVE PURCHASERS ARE HEREBY NOTIFIED THAT SELLERS OF THE RULE 144A NOTES MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A. FOR A DESCRIPTION OF THESE AND
CERTAIN FURTHER RESTRICTIONS, SEE ‘‘SUBSCRIPTION AND SALE’’ AND ‘‘TRANSFER RESTRICTIONS.’’
Under Russian law, the Notes are securities of a foreign issuer. The Notes are not eligible for initial offering and public circulation in the Russian Federation. Neither the issue
of the Notes nor a securities prospectus in respect of the Notes has been, or is intended to be, registered with the Federal Service for Financial Markets of the Russian
Federation (the ‘‘FSFM’’). The information provided in this Base Prospectus is not an offer, or an invitation to make offers, to sell, exchange or otherwise transfer the Notes
in the Russian Federation or to or for the benefit of any Russian person or entity.
Application has been made to the Financial Services Authority in its capacity as competent authority under the Financial Services and Markets Act 2000 (‘‘FSMA’’) (the ‘‘UK
Listing Authority’’) for Notes issued under the Programme for the period of 12 months from the date of this Base Prospectus to be admitted to the official list of the UK Listing
Authority (the ‘‘Official List’’) and to the London Stock Exchange plc (the ‘‘London Stock Exchange’’) for such Notes to be admitted to trading on the London Stock
Exchange’s Gilt Edged and Fixed Interest Market (the ‘‘Market’’). References in this Base Prospectus to Notes being ‘‘listed’’ (and all related references) shall mean that such
Notes have been admitted to the Official List and have been admitted to trading on the Market. The Market is a regulated market for the purposes of the Investment Services
Directive 93/22/EEC. Unlisted Notes may also be issued pursuant to the Programme. The relevant Final Terms in respect of the issue of any Notes will specify whether or
not such Notes will be listed on the London Stock Exchange (or any other stock exchange) and admitted to trading on the Market (or any other market). Application may
also be made to have Rule 144A Notes designated as eligible for trading in the Private Offering, Resale and Trading through Automated Linkages (‘‘PORTAL’’) System of
the National Association of Securities Dealers, Inc., as specified in the applicable Final Terms.
Regulation S Notes of each Series which are sold in an ‘‘offshore transaction’’ within the meaning of Regulation S, will initially be represented by interests in a global
unrestricted Note in registered form (each a ‘‘Regulation S Global Note’’), without interest coupons, which will be deposited with a common depositary for, and registered
in the name of a nominee of, Euroclear Bank S.A./N.V. as operator of the Euroclear System (‘‘Euroclear’’) and Clearstream Banking, société anonyme (‘‘Clearstream,
Luxembourg’’) on its Issue Date. Beneficial interests in a Regulation S Global Note will be shown on, and transfers thereof will be effected only through records maintained
by, Euroclear or Clearstream, Luxembourg. Rule 144A Notes of each Series sold to QIBs that are also QPs, as referred to in, and subject to the transfer restrictions described
in, ‘‘Subscription and Sale’’ and ‘‘Transfer Restrictions,’’ will initially be represented by interests in a global restricted Note in registered form (each a ‘‘Rule 144A Global Note’’
and, together with any Regulation S Global Notes, the ‘‘Global Notes’’), without interest coupons, which will be deposited with a custodian for, and registered in the name
of a nominee of, The Depository Trust Company (‘‘DTC’’) on its Issue Date. Beneficial interests in a Rule 144A Global Note will be shown on, and transfers thereof will be
effected only through, records maintained by DTC and its participants. See ‘‘Summary of the Provisions Relating to the Notes in Global Form.’’ Individual definitive Notes
in registered form will only be available in certain limited circumstances as described herein.
The price and amount of Notes to be issued under the Programme will be determined by the Issuer, Sberbank and the relevant Dealer at the time of issue in accordance with
prevailing market conditions. The minimum denomination of any Notes issued under the Programme shall be u50,000 (or its equivalent in any other currency as at the date
of issue of the Notes).

                                                               Arrangers and Permanent Dealers

                                                      Barclays Capital                                       JPMorgan
                                                                              Permanent Dealers
ABN AMRO                           BNP PARIBAS                                             Citigroup                                      Goldman Sachs International
  HSBC                          ING Wholesale Banking                             Merrill Lynch International                               UBS Investment Bank

                                                         The date of this Base Prospectus is May 12, 2006.
This Base Prospectus comprises a base prospectus for the purposes of Article 5.4 of Directive 2003/71/EC
of the European Parliament and the Council (the ‘‘Prospectus Directive’’) and for the purpose of giving
information with regard to the Issuer and Sberbank which, according to the particular nature of the Issuer,
Sberbank, the Notes and the Loans, is necessary to enable investors to make an informed assessment of
the assets and liabilities, financial position, profit and losses and prospects of the Issuer and Sberbank.
Each of the Issuer and Sberbank accepts responsibility for the information contained in this Base
Prospectus. To the best of the knowledge and belief of each of the Issuer and Sberbank (having taken all
reasonable care to ensure that such is the case) the information contained in this Base Prospectus is in
accordance with the facts and does not omit anything likely to affect the import of such information.
Sberbank’s legal name is Savings Bank of the Russian Federation, and the address of its registered office
is 19 Vavilova Street, 117997 Moscow, Russian Federation. The telephone number of the registered office
is +7 495 974-6677. The Issuer’s legal name is SB Capital S.A. The Issuer is registered with the Register
of Commerce and Companies, Luxembourg under number B-115914. Its registered address is 2,
Boulevard Konrad Adenauer, L-1115 Luxembourg. The Issuer may be reached by telephone at
+352-421-22-243.
Sberbank has derived substantially all of the information contained in this Base Prospectus concerning the
Russian banking market and its competitors, which may include estimates or approximations from
publicly available information, including annual reports, industry publications, market research, press
releases and filings made under various securities laws. In addition, some of the information contained in
this Base Prospectus has been derived from official data published by Russian government agencies and
the Central Bank of the Russian Federation (the ‘‘CBR’’ or ‘‘CBRF’’). Where information has been
sourced from a third party, this information has been accurately reproduced and so far as Sberbank or the
Issuer is aware and is able to ascertain from information published by the third party, no facts have been
omitted which would render the reproduced information inaccurate or misleading. See ‘‘Risk Factors—
Other Risks—No independent verification of information regarding Sberbank’s competitors and official
data from Russian government agencies and the CBR.’’
This Base Prospectus does not constitute an offer of, or an invitation by or on behalf of, the Issuer,
Sberbank, the Dealers or the Arrangers (each as defined under ‘‘Overview of the Programme’’) to
subscribe for or purchase any of the Notes.
The distribution of this Base Prospectus and the offer or sale of the Notes in certain jurisdictions may be
restricted by law. Persons into whose possession this Base Prospectus comes are required by the Issuer,
Sberbank, the Dealers and the Arrangers to inform themselves about and to observe any such restrictions.
Further information with regard to restrictions on offers and sales of the Notes and the distribution of this
Base Prospectus is set out under ‘‘Subscription and Sale.’’
No person is authorised to provide any information or make any representation not contained in this Base
Prospectus and any information or representation not contained in this Base Prospectus and any
information or representation so contained must not be relied upon as having been authorised by, or on
behalf of, the Issuer, Sberbank, the Trustee (as defined under ‘‘Overview of the Programme’’), any of the
Dealers or the Arrangers. The delivery of this Base Prospectus at any time does not imply that the
information contained in it is correct as at any time subsequent to its date. The website of Sberbank does
not form any part of the contents of this Base Prospectus.
Neither the delivery of this Base Prospectus nor the offer, sale or delivery of any Note shall in any
circumstances create any implication that there has been no adverse change, or any event reasonably
likely to involve any adverse change, in the condition (financial or otherwise) of the Issuer or Sberbank
since the date of this Base Prospectus.
The Arrangers and the Dealers have not separately verified the information contained in this Base
Prospectus. None of the Arrangers or the Dealers makes any representation, express or implied, or
accepts any responsibility, with respect to the accuracy or completeness of any of the information in this
Base Prospectus. This Base Prospectus is not intended to provide the basis of any credit or other
evaluation and should not be considered as a recommendation by any of Sberbank, the Issuer, the Trustee,
the Arrangers or the Dealers that any recipient of this Base Prospectus or any financial statements should
purchase the Notes. Each potential purchaser of Notes should determine for itself the relevance of the
information contained in this Base Prospectus and its purchase of Notes should be based upon such
investigation as it deems necessary. None of the Arrangers or the Dealers undertakes to review the
financial condition or affairs of Sberbank or the Issuer during the life of the arrangements contemplated
by this Base Prospectus nor to advise any investor or potential investor in the Notes of any information

                                                      i
coming to the attention of any of the Arrangers or the Dealers. Furthermore, none of the Issuer,
Sberbank, the Trustee, the Arrangers or the Dealers or any of the respective representatives is making
any representation to any offeree or purchaser of the Notes regarding the legality of an investment by
such offeree or purchaser under relevant legal investment or similar laws. Each investor should consult
with their own advisers as to the legal, tax, business, financial and related aspects of purchase of the Notes.
Prospective purchasers must comply with all laws that apply to them in any place in which they buy, offer
or sell any Notes or possess this Base Prospectus. Any consents or approvals that are needed in order to
purchase any Notes must be obtained. Sberbank, the Issuer, the Arrangers and the Dealers are not
responsible for compliance with these legal requirements. The appropriate characterisation of any Notes
under various legal investment restrictions, and thus the ability of investors subject to these restrictions
to purchase such Notes, is subject to significant interpretative uncertainties. No representation or
warranty is made as to whether, or the extent to which, any Notes constitute a legal investment for
investors whose investment authority is subject to legal restrictions. Such investors should consult their
legal advisers regarding such matters.
This Base Prospectus is only being distributed to and is only directed at (i) persons who are outside the
United Kingdom or (ii) to investment professionals falling within Article 19(5) of the Financial Services
and Markets Act 2000 (Financial Promotion) Order 2005 (the ‘‘Order’’) or (iii) high net worth entities,
and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the
Order (all such persons together being referred to as ‘‘relevant persons’’). The Notes are only available
to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Notes will be
engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely
on this document or any of its contents.
The Notes are securities of a foreign issuer under Russian law and are not eligible for initial offering and
public circulation in the Russian Federation. Neither the issue of the Notes nor a securities prospectus in
respect of the Notes has been, or is intended to be, registered with the FSFM. The information provided
in this Base Prospectus is not an offer, or an invitation to make offers, to sell, exchange or otherwise
transfer the Notes in the Russian Federation or to or for the benefit of any Russian person or entity.
In connection with the issue of any Series of Notes, one of the Dealers, if any, will act as the stabilising
manager (the ‘‘Stabilising Manager’’), as disclosed in the relevant Final Terms. Such Stabilising Manager
(or persons acting on its behalf) may over-allot Notes (provided that the aggregate principal amount of
the Notes allotted does not exceed 105% of the aggregate principal amount of the Notes) or effect
transactions with a view to supporting the market price of the Notes at a level higher than that which
might otherwise prevail. However, there is no assurance that such Stabilising Manager (or persons acting
on its behalf) will undertake stabilisation action. Any stabilisation action may begin on or after the date
on which adequate public disclosure of the terms of the offer of a Series of Notes is made and, if begun,
may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of such
Series of Notes and 60 days after the date of allotment of such Series of Notes.
NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS MADE BY THE DEALERS
OR THE ARRANGERS AS TO THE ACCURACY OR COMPLETENESS OF THE INFORMATION
SET FORTH IN THIS DOCUMENT, AND NOTHING CONTAINED IN THIS DOCUMENT IS, OR
SHALL BE RELIED UPON AS, A PROMISE OR REPRESENTATION, WHETHER AS TO THE
PAST OR THE FUTURE. NONE OF THE DEALERS OR THE ARRANGERS ASSUMES ANY
RESPONSIBILITY FOR THE ACCURACY OR COMPLETENESS OF THE INFORMATION
CONTAINED IN THIS BASE PROSPECTUS.
EACH PERSON CONTEMPLATING MAKING AN INVESTMENT IN ANY NOTES ISSUED
UNDER THIS PROGRAMME FROM TIME TO TIME MUST MAKE ITS OWN INVESTIGATION
AND ANALYSIS OF THE CREDITWORTHINESS OF SBERBANK AND THE ISSUER AND ITS
OWN DETERMINATION OF THE SUITABILITY OF ANY SUCH INVESTMENT, WITH
PARTICULAR REFERENCE TO ITS OWN INVESTMENT OBJECTIVES AND EXPERIENCE
AND ANY OTHER FACTORS WHICH MAY BE RELEVANT TO IT IN CONNECTION WITH
SUCH INVESTMENT.
THE NOTES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE U.S. SECURITIES
AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION IN THE UNITED
STATES OR ANY OTHER U.S. REGULATORY AUTHORITY, NOR HAVE ANY OF THE
FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE NOTES


                                                      ii
OR THE ACCURACY OR THE ADEQUACY OF THIS BASE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED
STATES.

                           NOTICE TO NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A
LICENCE HAS BEEN FILED UNDER CHAPTER 421-B OF THE NEW HAMPSHIRE REVISED
STATUTES (‘‘RSA’’) WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT THAT A
SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THE STATE OF
NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW
HAMPSHIRE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND
NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR
EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT THE
SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS
OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY OR
TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE MADE, TO ANY
PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANY REPRESENTATION
INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.

                                   ADDITIONAL INFORMATION
Neither the Issuer nor Sberbank is required to file periodic reports under Section 13 or 15 of the U.S.
Securities Exchange Act of 1934 (the ‘‘Exchange Act’’). For so long as either the Issuer or Sberbank is not
a reporting company under Section 13 or 15(d) of the Exchange Act, or exempt from reporting pursuant
to Rule 12g3-2(b) thereunder, the Issuer or Sberbank, as the case may be, will, upon request, furnish to
each holder or beneficial owner of Notes that are ‘‘restricted securities’’ (within the meaning of
Rule 144(a)(3) under the Securities Act) and to each prospective purchaser thereof designated by such
holder or beneficial owner upon request of such holder, beneficial owner or prospective purchaser, in
connection with a transfer or proposed transfer of any such Notes pursuant to Rule 144A under the
Securities Act or otherwise, the information required to be delivered pursuant to Rule 144A(d)(4) under
the Securities Act.




                                                    iii
                                                              TABLE OF CONTENTS

ENFORCEABILITY OF JUDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      v
SUPPLEMENTAL BASE PROSPECTUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                         v
PRESENTATION OF FINANCIAL AND OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . .                                                                     vi
EXCHANGE RATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 viii
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      ix
SUMMARY OF SBERBANK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                            1
OVERVIEW OF THE PROGRAMME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      6
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          16
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 29
CAPITALISATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              30
SELECTED FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                          31
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    33
FINANCIAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  58
MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              68
TRANSACTIONS WITH RELATED PARTIES AND STATE-OWNED ENTITIES . . . . . . . .                                                                                      75
PRINCIPAL SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                              77
THE BANKING SECTOR AND BANKING REGULATION IN RUSSIA . . . . . . . . . . . . . . . . .                                                                           78
THE ISSUER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      94
FACILITY AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      95
FORM OF SUBORDINATED LOAN AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                                      126
TERMS AND CONDITIONS OF THE NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                            156
SUMMARY OF THE PROVISIONS RELATING TO THE NOTES IN GLOBAL FORM . . .                                                                                           168
SUBSCRIPTION AND SALE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        174
TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     178
TRANSFER RESTRICTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        183
FORM OF FINAL TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      186
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          191
INDEX TO FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      F-1




                                                                                  iv
                               ENFORCEABILITY OF JUDGMENTS
Sberbank is an open joint stock company incorporated under the laws of the Russian Federation and most
of its assets are currently located outside the United Kingdom and the United States. In addition, all of
Sberbank’s directors and executive officers are residents of countries other than the United Kingdom and
the United States. As a result, it may not be possible for the Noteholders to:
•   effect service of process within the United Kingdom or the United States upon any of Sberbank’s
    directors or executive officers named in this Base Prospectus; or
•   enforce, in the English or U.S. courts, judgments obtained outside English or U.S. courts against
    Sberbank or any of its directors and executive officers named in this Base Prospectus in any action.
In addition, it may be difficult for the Noteholders to enforce, in original actions brought in courts in
jurisdictions located outside the United Kingdom and the United States, liabilities predicated upon
English laws or the U.S. federal securities laws.
Judgments rendered by a court in any jurisdiction outside the Russian Federation are likely to be
recognised by courts in Russia only (i) if an international treaty providing for the recognition and
enforcement of judgments in civil cases exists between the Russian Federation and the country where the
judgment is rendered and/or (ii) if a federal law of the Russian Federation provides for the recognition
and enforcement of foreign court judgements. No such treaty exists between the United States and Russia
or between the United Kingdom and Russia for the reciprocal enforcement of foreign court judgments,
and no relevant federal law on enforcement of foreign court judgments has been adopted in Russia. See
‘‘Risk Factors—Risks Relating to the Russian Legal System and Russian Legislation—Recognition of
foreign judgments in Russia.’’
Each Loan Agreement will be governed by English law and will provide the option for disputes,
controversies and causes of action brought by any party thereto against Sberbank to be settled by
arbitration in accordance with the Rules of the London Court of International Arbitration (‘‘LCIA’’). The
Russian Federation is a party to the United Nations (New York) Convention on the Recognition and
Enforcement of Foreign Arbitral Awards. However, it may be difficult to enforce arbitral awards in the
Russian Federation due to:
•   the inexperience of the Russian courts in international commercial transactions;
•   official and unofficial political resistance to the enforcement of awards against Russian companies in
    favour of foreign investors; and
•   the inability of Russian courts to enforce such awards.
Furthermore, any arbitral award pursuant to arbitration proceedings in accordance with the Rules of the
LCIA and the application of English law to the Loan Agreement may be limited by the mandatory
provisions of Russian laws relating to the exclusive jurisdiction of Russian courts and the application of
Russian laws with respect to bankruptcy, winding up or liquidation of Russian companies and credit
organisations in particular.

                              SUPPLEMENTAL BASE PROSPECTUS
Sberbank will, in connection with the listing of the Notes on the London Stock Exchange, so long as any
Note remains outstanding and listed on such exchange, in the event of any significant new factor, material
mistake or inaccuracy relating to the information contained in this Base Prospectus, prepare a supplement
to this Base Prospectus or publish a new Base Prospectus for use in connection with any subsequent issue
of the Notes to be listed on the London Stock Exchange.
The Issuer and Sberbank may agree with any Dealer that a Series of Notes may be issued in a form not
contemplated by the ‘‘Terms and Conditions of the Notes’’ herein, in which event a supplemental Base
Prospectus, if appropriate, will be published that will describe the effect of the agreement reached in
relation to such Notes.




                                                    v
                 PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Presentation of Financial Information
Sberbank’s financial information set forth herein has, unless otherwise indicated, been derived from its audited
financial statements as of and for the year ended December 31, 2005 (the ‘‘IFRS Financial Statements’’), as set
forth on pages F-2 through F-63 of this Base Prospectus, prepared in accordance with International Financial
Reporting Standards (‘‘IFRS’’) issued by the International Accounting Standards Board (the ‘‘IASB’’). The
Russian Rouble is the functional and presentation currency for Sberbank’s IFRS Financial Statements.

Currency
In this Base Prospectus, the following currency terms are used:
•   ‘‘RUR,’’ ‘‘RR,’’ ‘‘Russian Rouble’’ or ‘‘rouble’’ means the lawful currency of the Russian Federation;
•   ‘‘U.S. dollar,’’ ‘‘USD’’ or ‘‘U.S.$’’ means the lawful currency of the United States of America;
•   ‘‘EUR,’’ ‘‘euro’’ or ‘‘w’’ means the lawful currency of the Member States of the European Union that
    adopted the single currency in accordance with the Treaty of Rome establishing the European
    Economic Community, as amended by the Treaty on the European Union, signed at Maastricht on
    February 7, 1992; and
•   ‘‘£’’ means the lawful currency of the United Kingdom of Great Britain and Northern Ireland.

Adoption of New or Revised Standards and Interpretations
Certain new IFRSs became effective for Sberbank from January 1, 2005. All such changes in accounting
policies were applied retrospectively. The nature of the adjustments made due to application of new
IFRSs and its effect to corresponding information for the year ended December 31, 2004 is disclosed in
Note 5 to the IFRS Financial Statements.
All financial information of Sberbank as of and for the year ended December 31, 2004 contained in this
Base Prospectus is presented on a restated basis, taking into account the results of retrospective adoption
of new or revised IFRSs.

This Base Prospectus includes, on pages F-64 through F-103, Sberbank’s audited IFRS financial
statements as of and for the year ended December 31, 2004 (the ‘‘Unrestated IFRS Financial
Statements’’). These financial statements have not been adjusted to take into account certain changes in
IFRSs that were effective in 2005. Accordingly, the Unrestated IFRS Financial Statements are not
comparable to, and should not be compared with, the IFRS Financial Statements.

Except for the information contained in the Unrestated Financial Statements, the financial information of
Sberbank as of and for the year ended December 31, 2004 contained in this Base Prospectus has been
adjusted to take into account the application of new IFRSs.

Sberbank’s Market Share Information
Sberbank has calculated its market share information presented in this Base Prospectus on the basis of
market data regularly published by the CBR.

Rounding
Some numerical figures included in this Base Prospectus have been subject to rounding adjustments.
Accordingly, numerical figures shown as totals in certain tables may not be an arithmetic aggregation of
the figures that precede them.

Auditors
Sberbank’s IFRS financial statements as of and for the year ended December 31, 2005, included in this
Base Prospectus, have been audited by ZAO PricewaterhouseCoopers Audit, independent auditors, as
stated in their report appearing herein. The address of ZAO PricewaterhouseCoopers Audit is
Kosmodamianskaya Naberezhnaya 52, Building 5, Moscow 115054, Russian Federation. ZAO
PricewaterhouseCoopers Audit is a member of the Institute of Professional Accountants of Russia.


                                                      vi
Sberbank’s Unrestated IFRS Financial Statements included in this Base Prospectus have been audited by
CJSC Ernst & Young Vneshaudit, independent auditors, who have expressed an unqualified opinion on
those statements, as stated in their report appearing herein. CJSC Ernst & Young Vneshaudit, as stated
in their report appearing herein, have additionally audited the adjustments made, as a result of the
application of new IFRSs, to the IFRS financial statements as of and for the year ended December 31,
2004, included in the IFRS Financial Statements for comparison purposes, as described in ‘‘—Adoption
of New or Revised Standards and Interpretations.’’ The address of CJSC Ernst & Young Vneshaudit is
Sadovnicheskaya Naberezhnaya 77, Building 1, Moscow 115035, Russian Federation. CJSC Ernst &
Young Vneshaudit is a member of the Institute of Professional Accountants of Russia.

Differences Between EU-Adopted IFRS and IASB IFRS
The financial information included in this Base Prospectus has not been prepared in accordance with the
international accounting standards adopted pursuant to the procedure of Article 3 of Regulation (EC)
No. 1606/20002 (the ‘‘EU IFRS’’) and there may have been differences in the financial information had
the EU IFRS been applied, but Sberbank does not believe that these differences would have been
material. The principal differences between IFRS as adopted by the IASB and the EU IFRS concern the
application of IAS 39 ‘‘Financial Instruments: Recognition and Measurement’’ (‘‘IAS 39’’). For
description of the accounting policies in respect of the IAS 39 application by Sberbank in its IFRS
financial statements, see Notes 3, 4, 5, 6 and 35 to the IFRS Financial Statements.




                                                 vii
                                                  EXCHANGE RATES
The following table sets forth, for the periods indicated, the high, low, average and period-end official
rates set by the CBR, in each case for the purchase of roubles, all expressed in roubles per U.S. dollar.
These translations should not be construed as representations that rouble amounts actually represent such
U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated as of any of the dates
mentioned in this Base Prospectus or at all.

                                                                              High        Low     Average(1)          Period End
                                                                                           (RUR per U.S. dollar)
2006   (January through May 12, 2006) . . . . . . . . . . . . . . . . .      28.48       27.04            27.87            27.08
2005   ..............................................                        29.00       27.46            28.33            28.78
2004   ..............................................                        29.45       27.75            28.73            27.75
2003   ..............................................                        31.88       29.25            30.61            29.45
2002   ..............................................                        31.86       30.13            31.39            31.78
2001   ..............................................                        30.30       28.16            29.22            30.14
(1)   The average of the exchange rates on the last business day of each month for the relevant annual period and on each business
      day for any other period.




                                                               viii
                                  FORWARD-LOOKING STATEMENTS
Certain statements in this Base Prospectus are not historical facts and constitute ‘‘forward-looking
statements.’’ Forward-looking statements are identified by words such as ‘‘believes,’’ ‘‘anticipates,’’
‘‘expects,’’ ‘‘estimates,’’ ‘‘intends,’’ ‘‘plans,’’ ‘‘will,’’ ‘‘may’’ and similar expressions, but these expressions
are not the exclusive means of identifying such statements. Forward-looking statements appear, without
limitation, under the headings ‘‘Summary of Sberbank,’’ ‘‘Risk Factors,’’ ‘‘Financial Review’’ and
‘‘Business.’’ Sberbank may from time to time make written or oral forward-looking statements in reports
to shareholders and in other communications. Examples of such forward-looking statements include, but
are not limited to:
•    statements of Sberbank’s plans, objectives or goals, including those related to its strategy, products or
     services;
•    statements of future economic performance; and
•    statements of assumptions underlying such statements.
Forward-looking statements that may be made by Sberbank from time to time (but that are not included
in this Base Prospectus) may also include projections or expectations of revenues, income (or loss),
earnings (or loss) per share, dividends, capital structure or other financial items or ratios.
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general
and specific, and risks exist that the predictions, forecasts, projections and other forward-looking
statements will not be achieved. Prospective investors should be aware that a number of important factors
could cause actual results to differ materially from the plans, objectives, expectations, estimates and
intentions expressed in such forward-looking statements. These factors include:
•    inflation, interest rate and exchange rate fluctuations in Russia;
•    prices for securities issued by Russian entities and for precious metals;
•    the health of the Russian economy, including the Russian banking sector;
•    the effects of, and changes in, the policy of the federal government of Russia and regulations
     promulgated by the CBR;
•    the effects of competition in the geographic and business areas in which Sberbank conducts its
     operations;
•    the effects of changes in laws, regulations, taxation or accounting standards or practices in the
     jurisdictions where Sberbank conducts its operations;
•    Sberbank’s ability to increase market share for its products and services and control expenses;
•    acquisitions or divestitures;
•    technological changes; and
•    Sberbank’s success at managing the risks associated with the aforementioned factors.
This list of important factors is not exhaustive. When relying on forward-looking statements, prospective
investors should carefully consider the foregoing factors and other uncertainties and events, especially in
light of the political, economic, social and legal environment in which Sberbank operates. Such
forward-looking statements speak only as of the date on which they are made and are not subject to any
continuing obligations under the listing rules of the London Stock Exchange. Accordingly, Sberbank does
not undertake any obligation to update or revise any of them, whether as a result of new information,
future events or otherwise. Sberbank does not make any representation, warranty or prediction that the
results anticipated by such forward-looking statements will be achieved, and such forward-looking
statements represent, in each case, only one of many possible scenarios and should not be viewed as the
most likely or standard scenario.




                                                        ix
                                     SUMMARY OF SBERBANK
Overview
Sberbank is the largest commercial bank in Russia. According to The Banker magazine, a leading banking
industry publication, Sberbank is also the largest bank in Central and Eastern Europe (including Russia)
in terms of Tier 1 capital and assets. Sberbank plays a significant role in Russia’s financial system and
economy. It is the largest lender in Russia and the largest taker of deposits. Sberbank believes that as of
January 1, 2006 under the Russian Accounting Regulations applicable to banks (‘‘RAR’’), its assets
accounted for 26.5% of all Russian banking sector assets. According to Sberbank’s calculations as of
January 1, 2006, it had, in Russia, a 58.5% market share in rouble retail deposits, a 40.8% market share
in hard currency retail deposits, a 44.1% market share in loans to individuals, a 32.0% market share in
rouble and a 32.6% market share in foreign currency loans to legal entities, a 16.7% market share in
account balances of legal entities and a 16.6% share in the government securities trading market, all as
calculated in terms of value and under RAR. According to Expert magazine, a leading Russian business
weekly, as of January 1, 2006, Sberbank’s assets, as calculated under RAR, exceeded the combined assets
of the next ten largest Russian banks. For further information about Sberbank’s share of the Russian
banking market, see ‘‘—Market Position and Competitive Strengths.’’
Sberbank’s principal activities include deposit taking, payment, account and settlement services, lending,
trading and investing in securities on its own and clients’ behalf, conducting foreign exchange and foreign
trade transactions, cash handling services, operations with precious metals and coins, depositary services
and other ancillary services for retail and corporate clients.
Sberbank has prepared IFRS financial statements since 1996. For the year ended December 31, 2005, it
generated operating profit of RUR202.0 billion and had a profit of RUR65.8 billion. Of Sberbank’s
operating profit in 2005, net interest income accounted for 77.4%, or RUR156.4 billion, net fee and
commission income accounted for 17.7% or RUR35.8 billion and gains less losses arising from trading
securities and other securities at fair value through profit or loss accounted for 8.0%, or RUR16.1 billion.
For a comparison with corresponding results for the year ended December 31, 2004, see ‘‘Financial
Review.’’ As of December 31, 2005, Sberbank’s total assets were RUR2,513.1 billion and its return on
equity (calculated as profit for the year divided by average total equity) was 34.2%.
Under Russian banking legislation and Sberbank’s charter, the CBR must hold a controlling stake (at least
50% plus one voting share) in Sberbank. As of December 31, 2005, the CBR owned 63.76% of Sberbank’s
ordinary shares and 60.57% of its total share capital (which consists of ordinary and preference shares)
and is thus its controlling shareholder. The representatives of the CBR hold seven, the representatives of
the Russian government hold three, and a representative of the Russian President holds one, of the 16
seats on Sberbank’s Supervisory Board. Two other seats are held by representatives of Sberbank and three
by independent members that are not affiliated with the CBR, the Russian government or Sberbank. The
Chairman of the CBR serves as Chairman and the two First Deputy Chairmen of the CBR serve as
Deputy Chairmen of Sberbank’s Supervisory Board.
Sberbank’s shares have been publicly traded in Russia since 1996. As of December 31, 2005, foreign
investors owned 18% of Sberbank’s shares (including in the form of unsponsored depositary shares). As
of the same date, institutional and private investors (including foreign investors) owned 38.1% of
Sberbank’s shares.
As of March 1, 2006, Sberbank conducts its banking business through its 17 Regional Head Offices, 972
branches and 19,298 sub-branches and outlets. Sberbank’s Central Head Office is located at 19 Vavilova
Street, 117997 Moscow, Russian Federation. The telephone number of the Central Head Office is +7 495
974-6677. See ‘‘—Business Strategy—Internal Development—Branch Network.’’
Sberbank is a member of the World Savings Bank Institute, of which its Chairman and Chief Executive
Officer, Andrei I. Kazmin, is a vice-president, the European Savings Banks Group and the U.S.-Russia
Business Council. It is also a member of a number of international financial organisations, including the
International Banking Security Association, the International Securities Market Association, the
International Chamber of Commerce and SWIFT. In addition, Sberbank is a member of the major
organisations that form the infrastructure of the Russian financial markets, including the Association of
Russian Banks (of which Sberbank’s Chairman and Chief Executive Officer, Andrei I. Kazmin, is
vice-president), the Moscow Interbank Currency Exchange (‘‘MICEX’’), the National Depositary Centre,
the National Currency Association, the Association of Participants in the Bills of Exchange Market and
the National Fund Association. Sberbank’s Chairman and Chief Executive Officer, Andrei I. Kazmin, is
also a member of the board of directors of MasterCard Europe.

                                                    1
Sberbank has a long-term issuer default rating of ‘‘BBB’’ from Fitch and a foreign currency deposit rating
of ‘‘Baa2/Prime-2’’ and a financial strength rating of ‘‘D-’’ from Moody’s.
Market Position and Competitive Strengths
According to the CBR, as of February 1, 2006, 1,247 banks and non-bank credit organisations were
operating in Russia. The largest Russian banks are concentrated in Moscow, and large regional banks
conduct most of their business in the central cities of their home regions. Although some Moscow-based
banks have been expanding in the regions, outside Moscow and regional centres Sberbank is often the
only local provider of banking services, particularly retail banking services.
The range of products and services offered by Russian banks to their clients is expanding. However, few
banks provide comprehensive packages of products and services tailored to the needs of different retail
and corporate client groups.
According to Sberbank’s calculations, as determined by value and calculated under RAR, as of January
1, 2006, it was the largest deposit taker in Russia, with a market share ranging from 40.3% in Western
Siberia to 81.7% in the Altay region, and was also the largest retail lender in Russia, with a market share
of 44.1%. As of that date, according to its calculations, Sberbank provided 47.3% of all rouble loans made
to individuals in Russia, as well as 32.0% of all rouble loans and 32.6% of all foreign currency loans made
to legal entities in Russia. Its market share of loans to legal entities ranged from 19.9% in the North-West
of Russia to 50.7% in the Western Urals region. For further information about Sberbank’s share of the
Russian banking market, see the first paragraph under ‘‘—Overview.’’ Sberbank’s retail customer base is
the largest in Russia, and individuals come into contact with its business units and services on a regular
basis. One in seven employed individuals receives his or her salary and one in four pensioners receives his
or her pension through Sberbank. More than half of all payments made by individuals in Russia, as
measured by value of transactions, are made through Sberbank.
Sberbank believes that it is well-positioned to capitalise on the opportunities in the Russian banking
market in general and in the corporate banking market in particular because of a number of competitive
advantages, including reputation, brand recognition, a large, stable and well-diversified funding base, a
national banking network, independence and experienced management.
•   Reputation. Sberbank has a reputation as a stable and reliable bank. It was one of the few Russian
    banks that met in full its obligations to clients and other creditors during Russia’s 1998 financial crisis.
    In addition, Sberbank took over and fulfilled obligations to depositors of a number of bankrupt
    commercial banks. Sberbank also has a reputation as a reliable borrower among foreign banks.
    During the 1998 financial crisis, it repaid, on a timely basis, a U.S.$225 million syndicated loan facility
    and met all other obligations to foreign counterparties. See ‘‘The Banking Sector and Banking
    Regulation in Russia—Brief History of the Russian Banking Sector.’’ Sberbank is currently meeting
    all of its debt obligations on a timely basis.
•   Brand Recognition. Sberbank has long been present in the Russian banking market and, as of
    January 1, 2006, had 269.3 million retail bank accounts, an average of 1.9 accounts for every Russian,
    according to Sberbank’s calculations. Its longstanding and widespread market presence ensures that
    most Russians recognise the Sberbank brand.
•   Large, Stable and Well-Diversified Funding Base. Sberbank’s retail and corporate deposit business
    provides it with a stable and well-diversified funding base. As of February 1, 2006, Sberbank held
    RUR2,061.1 billion in retail and corporate deposits. According to Expert magazine, as of
    January 1, 2006, its retail deposits were 17.2 times greater than those of its closest competitor in
    Russia. The size of its funding base enables Sberbank to provide larger and longer-term loans than
    most of its competitors, particularly to corporate clients.
•   National Banking Network. Sberbank has a well-developed branch network that engages in retail
    as well as corporate banking. Sberbank believes that its national banking network is more extensive
    than the combined networks of all other Russian banks. Sberbank has a substantial presence in all
    the Russian regions and is often the only local bank that can offer a full range of banking products
    and services. Its branches are connected through a proprietary settlement system that is second only
    to the CBR’s in terms of the volume of payments. In 2005, its settlement system processed over
    541.5 million transactions.
•   Independence. Sberbank is not controlled by or affiliated with any Russian financial-industrial
    group. As a result, Sberbank conducts its business in a commercially reasonable manner and enters

                                                      2
    into transactions with companies that compete with each other. In contrast, many other Russian
    banks are part of financial-industrial groups and continue to focus on serving those groups and acting
    in their interests. Sberbank believes that its clients value its independence. Sberbank’s majority
    shareholder, the CBR, has not asserted control over the day-to-day decision-making or operations of
    Sberbank.
•   Experienced Management. Sberbank’s senior management team, headed by its Chairman and Chief
    Executive Officer Andrei I. Kazmin, a former Deputy Minister of Finance of the Russian Federation,
    is familiar with, and has substantial experience in, all aspects of the banking business.
Sberbank’s main competitive advantages in the corporate banking market are:
•   Nationwide branch network. Sberbank’s products and services are accessible to corporate clients
    throughout Russia, which gives Sberbank a competitive edge in reaching corporate clients at the local
    level, where the presence of its competitors is relatively limited.
•   Economies of scale and scope. Sberbank’s size and market penetration allow it to reduce the costs
    of its services and to offer them to more clients.
•   Sberbank’s proprietary settlement system. The ability to provide real-time settlement of transactions
    between different regions is a unique competitive advantage for Sberbank, as it appeals to corporate
    clients that require speed and reliability, particularly in long-distance transaction processing.

Business Strategy
Sberbank is a universal commercial bank and its strategic objective is to achieve a new level of quality in
client service in order to strengthen its leading position in the Russian banking market. Achieving this
strategic objective will enable Sberbank to retain its position as a modern, first-class bank and the largest
bank in Central and Eastern Europe (including Russia).
Sberbank’s management has identified the initiatives described below as essential to meeting its strategic
objective.

Retail Market
Sberbank is the leader in the Russian retail banking market, and its retail clients are the primary and the
most stable source of its funding. Sberbank intends to maintain its leading role in the retail market by
increasing the number and improving the quality of products and services offered to retail clients.
Sberbank is targeting as potential clients people of all ages, backgrounds and income levels: workers and
pensioners, the young and the middle-aged and low, medium and high-income individuals. Improvement
in the quality of its retail banking services is also a priority for Sberbank, especially in light of the
increasing competition in the retail banking sector and the rising consumer demand for banking products
and technologies.
Some of the initiatives upon which Sberbank has embarked in the retail banking market include the
following:
•   Focusing on cross-selling opportunities to existing retail customers. Sberbank expects that this will
    increase sales of fee-based services and deposit products and will result in an overall increase in the
    use of banking services by retail customers;
•   Increasing significantly the sales of existing retail credit products, such as consumer and mortgage
    loans, in order to capitalise on the growth of personal incomes and purchasing power of Russian
    consumers;
•   Taking advantage of a proprietary payment and settlement system that enables the use of bank cards
    throughout Russia and expanding the infrastructure for the use of bank cards and real-time account
    information management, in order to take advantage of a substantial increase in the demand for
    technologically-enhanced retail banking products; and
•   Increasing the marketing of private banking services as well as investment products offered by
    non-state pension funds, mutual funds, other financial institutions and insurance companies,
    particularly outside Moscow.
Sberbank believes that these retail market initiatives will strengthen long-term client relationships, ensure
the necessary increase in its funding base, promote risk diversification and increase fee-based revenues.

                                                     3
Banking Services to Corporate Clients
Sberbank is expanding its presence in the corporate banking market by leveraging its competitive
advantages and developing long-term working relationships with its corporate clients. In this market
segment, Sberbank is targeting large clients, medium-sized business clients and small businesses. For a
description of what constitutes large clients, medium-sized business clients and small businesses,
see ‘‘—Banking Services and Activities—Corporate and Public Sector Services—Client Segmentation.’’
Sberbank has set the following primary goals relating to servicing such clients:
•   Developing long-term relationships with large clients and maintaining and increasing the range of
    products offered to, and the volume of operations conducted with, such clients, as well as attracting
    new large clients from among the largest Russian enterprises operating in various industries and
    regions;
•   Significantly increasing the number of medium-sized business clients and the volume of banking
    products and services provided to such clients. Sberbank plans to create a range of banking products
    suitable for such clients’ needs, including products tailored to the needs of particular medium-sized
    business clients; and
•   Expanding the range and volume of services provided to small businesses. See ‘‘Business—Banking
    Services and Activities—Corporate and Public Sector Services—Services—Lending.’’

Banking Services to the Public Sector
The size and scale of Sberbank’s branch network and its long history as a service provider to the state
make it the provider of choice to state authorities and public enterprises. Sberbank intends to maintain
strong relationships with this client segment by:
•   Expanding its involvement in government economic development programmes on a nationwide,
    regional and industry sector basis; and
•   Offering the state and public enterprises improved capabilities of its branch network, further
    technological advances and new high-quality banking products.
Sberbank has a long history of providing certain services to state authorities and public enterprises
without charging fees for such services. However, Sberbank is negotiating with the Russian government,
as well as regional, local and municipal authorities a gradual shift of such services to a commercial basis.
These negotiations have already led to state authorities compensating a portion of expenses incurred by
Sberbank while acting as an agent for federal ministries and agencies.

Internal Development
In order to accomplish its strategic objectives in light of increased competition in the Russian banking
market, Sberbank intends to invest further in its:
•   Employees;
•   Information systems and technologies;
•   Branch network; and
•   Presence in the other Commonwealth of Independent States (the ‘‘CIS’’) countries.

Employee Development
Sberbank considers employee development fundamental to its strategic objective. Some of Sberbank’s
current initiatives in this area include:
•   Cooperation agreements with the best Russian colleges and universities;
•   Establishment of scholarships for the most talented economics students;
•   Further developing in-house personnel re-training and certification systems; and
•   Regularly sending its most promising employees for training with the world’s largest banks and for
    advanced studies.


                                                     4
Sberbank believes that these initiatives will allow it to hire the best graduates, to ensure the continuous
improvement of the skills of its employees and to develop an effective source of future senior
management. Sberbank plans to continue achieving the highest level of professional conduct and
motivation of its employees, which it considers instrumental to achieving its strategic objective, through
financial and non-financial incentives.

Information Systems and Technologies
Sberbank’s ability to execute its strategic plan relies on innovative technological solutions that drive the
automation of banking processes. Sberbank intends to concentrate on the development and enhancement
of its automated management systems, which will allow it to reduce costs relating to internal controls,
anti-money laundering procedures, asset, liability and risk management, accounting, financial reporting
and treasury operations. Sberbank’s comprehensive programme for automation of banking operations has
been examined by an international consulting firm, which confirmed that the proposed technological
solutions comply with leading international banking standards.

Sberbank plans to offer its clients a unified approach to banking products throughout Russia, offering the
latest banking products and services to clients living in the central as well as more remote regions.
Sberbank plans to further improve access of the Russian population to banking products and services not
only through its branch network but also through various selling systems, including automatic teller
machines (‘‘ATMs’’), self-service zones, ‘‘Client-Sberbank’’ remote communication system, the Internet,
mobile phones and call centres.

Branch Network
Sberbank’s branch network is a key long-term competitive advantage and is instrumental to the
availability of banking products and services throughout Russia. Sberbank is improving the accessibility,
effectiveness and quality of its client services through modification of its branch network. A key part of
this process is the automation of Sberbank’s sub-branches and outlets, including the creation of
self-service zones within branches that would streamline clients’ access to common banking services, such
as deposits and payments. Sberbank believes that such automation will make its personnel more available
to serve clients with respect to more complex banking products, such as loans.

CIS Presence
In light of increasing international economic integration and the international expansion of large Russian
companies, Sberbank believes that currently there are substantial business opportunities throughout the
CIS and that it will benefit from having a presence in the CIS countries where its Russian clients are
active. In light of this, Sberbank is considering acquiring banks in Ukraine and in Kazakhstan.




                                                     5
                                 OVERVIEW OF THE PROGRAMME

The following overview contains basic information about the Notes and Loans and should be read in
conjunction with, and is qualified in its entirety by, the information set forth under ‘‘Terms and Conditions
of the Notes,’’ ‘‘Facility Agreement’’ and ‘‘Form of Subordinated Loan Agreement’’ appearing elsewhere in
this Base Prospectus. The following overview does not purport to be complete and is taken from, and is
qualified in its entirety by, the remainder of this document and, in relation to the terms and conditions of any
particular Series of Notes, the applicable Final Terms. Words and expressions defined in ‘‘Terms and
Conditions of the Notes’’ below shall have the same meanings in this summary. The Issuer and Sberbank
may agree with any Dealer that Notes may be issued in a form other than that contemplated in ‘‘Terms and
Conditions of the Notes,’’ in which event a supplement to this Base Prospectus, if appropriate, will be made
available that will describe the effect of the agreement reached in relation to such Notes.

Each transaction will be structured as a Loan by the Issuer to Sberbank of a sum equivalent to the gross
proceeds of an issue of a Series of Notes. The Issuer will issue Notes to Noteholders for the sole purpose
of funding such Loan. Each Series of Notes will be constituted by a principal trust deed as supplemented
and amended in respect of such Series of Notes by a Supplemental Trust Deed (together, the ‘‘Trust
Deed’’), each entered into between the Issuer and the Trustee (as defined below). Pursuant to the Trust
Deed, the Issuer will (i) charge to the Trustee by way of a first fixed charge as security for a Series of Notes
(a) principal, interest and other amounts payable by Sberbank under the relevant Loan Agreement, (b)
the right to receive all sums which may be payable by Sberbank under any claim, award or judgement
relating to the relevant Loan Agreement and (c) all rights, title and interest in and to all sums of money
now or in the future deposited in an account established for the relevant Series of Notes with the Principal
Paying Agent in the name of the Issuer (the ‘‘Account’’), including interest from time to time earned
thereon, and (ii) assign certain of its rights under the relevant Loan Agreement (excluding any Reserved
Rights (as defined in the Terms and Conditions of the Notes)), to the Trustee for the benefit of the holders
of the corresponding Series of Notes.

Sberbank will be obliged to make payments under each Loan to the Issuer, in accordance with the terms
of the relevant Loan Agreement. Sberbank will be obliged under the terms of the relevant Loan
Agreement to make payments in respect of principal, interest and additional amounts (if any) to the
Issuer to the Account. The Issuer will agree in the Trust Deed not to make or consent to any amendment
to or any modification or waiver of, or authorise any breach or proposed breach of, the terms of any Loan
Agreement, unless the Trustee has given its prior written consent. The Issuer will further agree to act at
all times in accordance with any instructions of the Trustee from time to time with respect to each Loan
Agreement. Any material amendments, modifications, waivers or authorisations made with the Trustee’s
consent shall be notified to the Noteholders in accordance with, and as more fully described in, ‘‘Terms
and Conditions of the Notes—14. Notices,’’ and shall be binding on the Noteholders. Formal notice of the
security interests created by any Trust Deed will be given to Sberbank and the Principal Paying Agent
who will each be required to acknowledge the same.

Each Series of Notes will be limited recourse obligations and the Issuer will not have any obligation to
the Noteholders other than the obligation to account to Noteholders for payments of principal, interest
and other amounts, if any, received by it or for its account pursuant to the relevant Loan.

Set out below is a diagrammatic representation of the structure:




                                                      6
Notes to Be Issued under the Programme

Issuer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   SB Capital S.A.

Sberbank (as Borrower) . . . . . . . . . . . . . .                   Sberbank with its registered office at 19 Vavilova Street,
                                                                     117997 Moscow, Russian Federation.

Description . . . . . . . . . . . . . . . . . . . . . . . . .        Programme for the Issuance of Loan Participation Notes
                                                                     pursuant to which the Issuer may issue Notes.

Programme Size . . . . . . . . . . . . . . . . . . . . .             Up to U.S.$10,000,000,000 (or its equivalent in other
                                                                     currencies at the date of issue) aggregate principal amount of
                                                                     Notes outstanding at any one time. The Issuer, with the
                                                                     consent of Sberbank, may increase the amount of the
                                                                     Programme in accordance with the Dealer Agreement (as
                                                                     defined herein). In this respect, for the purpose of calculating
                                                                     the aggregate principal amount of Notes outstanding, Notes
                                                                     issued at a premium shall be treated as having been issued at
                                                                     the amount of their net proceeds received by the Issuer.

Arrangers . . . . . . . . . . . . . . . . . . . . . . . . . .        Barclays Bank PLC and J.P. Morgan Securities Ltd.

Dealers . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    Barclays Bank PLC, J.P. Morgan Securities Ltd., ABN
                                                                     AMRO Bank N.V., BNP Paribas, Citigroup Global Markets
                                                                     Limited, Goldman Sachs International, HSBC Bank plc,
                                                                     ING Bank N.V, London Branch, Merrill Lynch International
                                                                     and UBS Limited.
                                                                     Pursuant to the terms of the Dealer Agreement, the Issuer
                                                                     and Sberbank may from time to time terminate the
                                                                     appointment of any Dealer under the Programme or appoint
                                                                     additional Dealers either in respect of one or more Series of
                                                                     Notes or in respect of the whole Programme. References in
                                                                     this Base Prospectus to ‘‘Permanent Dealers’’ are to the
                                                                     persons listed above as Dealers and to such additional
                                                                     persons that are appointed as dealers in respect of the whole
                                                                     programme (and whose appointment has not been
                                                                     terminated) and to ‘‘Dealers’’ are to all Permanent Dealers
                                                                     and all persons appointed as dealers in respect of one or
                                                                     more Series of Notes.

Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    J.P. Morgan Corporate Trustee Services Limited.

Principal Paying Agent . . . . . . . . . . . . . . .                 JPMorgan Chase Bank, N.A., London Branch, unless it is
                                                                     specified in the relevant Final Terms relating to a Series of
                                                                     Notes that another principal paying agent is appointed in
                                                                     respect of that Series. References in this Base Prospectus to
                                                                     ‘‘Principal Paying Agent’’ are to J.P. Morgan Chase Bank
                                                                     N.A., London Branch, or such alternative principal paying
                                                                     agent or agents, as the case may be.

Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . .      JPMorgan Chase Bank, N.A., London Branch, unless it is
                                                                     specified in the relevant Final Terms relating to a Series of
                                                                     Notes that an alternative registrar is appointed in respect of
                                                                     that Series. References in this Base Prospectus to ‘‘Registrar’’
                                                                     are to JPMorgan Chase Bank, N.A., London Branch or such
                                                                     alternative registrar, as the case may be.

Paying Agents . . . . . . . . . . . . . . . . . . . . . .            JPMorgan Chase Bank, N.A., New York Branch, unless it is
                                                                     specified in the relevant Final Terms relating to a Series of
                                                                     Notes that another paying agent is appointed in respect of


                                                                             7
                                                                     that Series. References in this Base Prospectus to ‘‘Paying
                                                                     Agents’’ are to the Principal Paying Agent and JPMorgan
                                                                     Chase Bank, N.A., New York Branch or such alternative
                                                                     paying agent, as the case may be.

Transfer Agents . . . . . . . . . . . . . . . . . . . . .            JPMorgan Chase Bank, N.A., London Branch or, in relation
                                                                     to Notes sold pursuant to Rule 144A, JPMorgan Chase Bank,
                                                                     N.A., New York Branch, unless it is specified in the relevant
                                                                     Final Terms relating to a Series of Notes that another transfer
                                                                     agent is appointed in respect of that Series. References in this
                                                                     Base Prospectus to ‘‘Transfer Agent’’ are to JPMorgan Chase
                                                                     Bank, N.A., London Branch, JPMorgan Chase Bank, N.A.,
                                                                     New York Branch or such alternative transfer agent, as the
                                                                     case may be.

Calculation Agent . . . . . . . . . . . . . . . . . . .              JPMorgan Chase Bank, N.A., London Branch, unless it is
                                                                     specified in the relevant Final Terms relating to a Series of
                                                                     Notes that another calculation agent is appointed in respect
                                                                     of that Series. References in this Base Prospectus to
                                                                     ‘‘Calculation Agent’’ are to JPMorgan Chase Bank N.A.,
                                                                     London Branch, or such alternative calculation agent, as the
                                                                     case may be.

Method of Issue . . . . . . . . . . . . . . . . . . . . .            The Notes will be issued on a syndicated or non-syndicated
                                                                     basis. The Notes will be issued in series (each a ‘‘Series’’)
                                                                     having one or more issue dates and on terms otherwise
                                                                     identical (or identical other than in respect of the first
                                                                     payment of interest), the Notes of each Series being intended
                                                                     to be interchangeable with all other Notes of that Series. The
                                                                     specific terms of each Series will be set out in a Final Terms
                                                                     supplement to this Base Prospectus, which shall supplement
                                                                     the ‘‘Terms and Conditions of the Notes.’’

Issue Price of Notes . . . . . . . . . . . . . . . . .               Notes may be issued at their principal amount or at a
                                                                     discount or premium to their principal amount.

Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   Each Series of Notes will constitute the obligation of the
                                                                     Issuer to apply the proceeds from the issue of the Notes
                                                                     solely for financing the corresponding Loan and to account to
                                                                     the Noteholders for amounts equivalent to sums of principal,
                                                                     interest and additional amounts (if any) actually received by
                                                                     or for the account of the Issuer pursuant to such Loan, all as
                                                                     more fully described in ‘‘Terms and Conditions of the
                                                                     Notes—1. Status.’’

Security . . . . . . . . . . . . . . . . . . . . . . . . . . . .     The Issuer’s payment obligations in respect of each Series of
                                                                     Notes will be secured by a first fixed charge on:
                                                                     •   principal, interest and other amounts paid and payable
                                                                         under the relevant Loan Agreement and the Issuer’s
                                                                         right to receive all sums paid and payable under any
                                                                         claim, award or judgment relating to such Loan
                                                                         Agreement (save for any Reserved Rights (as defined in
                                                                         ‘‘Terms and Conditions of the Notes’’)); and
                                                                     •   all the rights, title and interest in and to all sums of
                                                                         money held from time to time in an account for the
                                                                         particular Series specified in the relevant Final Terms,
                                                                         together with the debt represented thereby (including
                                                                         interest from time to time) pursuant to the Trust Deed.



                                                                             8
Assignment of Rights . . . . . . . . . . . . . . . .                 The Issuer will assign its rights under the relevant Loan
                                                                     Agreement (save for any Reserved Rights and those rights
                                                                     charged above) to the Trustee upon the closing of the
                                                                     offering of the corresponding Series of Notes.

Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   Each Series of Notes will be issued in registered form. The
                                                                     Regulation S Notes and the Rule 144A Notes will be
                                                                     represented by the Regulation S Global Note and the Rule
                                                                     144A Global Note, respectively, in each case without interest
                                                                     coupons. The Global Notes will be exchangeable for
                                                                     Definitive Notes in the limited circumstances specified in the
                                                                     Global Notes.

Clearing Systems . . . . . . . . . . . . . . . . . . . .             The Depository Trust Company (in the case of Notes sold
                                                                     pursuant to Rule 144A), Euroclear and Clearstream,
                                                                     Luxembourg (in the case of Notes sold pursuant to
                                                                     Regulation S) and such other clearing system as may be
                                                                     agreed between the Issuer, Sberbank, the Paying Agents, the
                                                                     Trustee and the relevant Dealer(s). Application may be
                                                                     made for trading of the Rule 144A Notes in PORTAL, as
                                                                     specified in the relevant Final Terms.

Initial Delivery of Notes . . . . . . . . . . . . . .                On or before the issue date for each Series, the Rule 144A
                                                                     Global Note will be deposited with a custodian for The
                                                                     Depository Trust Company and the Regulation S Global
                                                                     Note will be deposited with a common depositary for
                                                                     Euroclear and Clearstream, Luxembourg. The Rule 144A
                                                                     Notes will be registered in the name of a nominee of The
                                                                     Depository Trust Company, and the Regulation S Notes will
                                                                     be registered in the name of a nominee of Euroclear and
                                                                     Clearstream, Luxembourg. Global Notes may also be
                                                                     deposited with any other clearing system or may be delivered
                                                                     outside any clearing system, provided that the method of
                                                                     such delivery has been agreed in advance by the Issuer,
                                                                     Sberbank, the Paying Agents, the Trustee and the relevant
                                                                     Dealer(s). Notes that are to be credited to one or more
                                                                     clearing systems on issue will be registered in the name of a
                                                                     nominee or nominees for such clearing systems.

Currencies . . . . . . . . . . . . . . . . . . . . . . . . . .       Subject to compliance with all relevant laws, regulations and
                                                                     directives, Notes may be issued in any currency agreed
                                                                     between the Issuer, Sberbank and the relevant Dealer(s).

Maturities . . . . . . . . . . . . . . . . . . . . . . . . . .       Subject to compliance with all relevant laws, regulations and
                                                                     directives, any maturity as may be agreed between the Issuer,
                                                                     Sberbank and the relevant Dealer(s).

Denomination . . . . . . . . . . . . . . . . . . . . . . .           Notes will be in such denominations as may be specified in
                                                                     the relevant Final Terms, save that unless otherwise permitted
                                                                     by then current laws and regulations, (i) Notes which have a
                                                                     maturity of less than one year and in respect of which the
                                                                     issue proceeds are to be accepted by the Issuer in the United
                                                                     Kingdom or whose issue otherwise constitutes a contravention
                                                                     of section 19 of the Financial Services and Markets Act 2000
                                                                     will have a minimum denomination of £100,000 (or its
                                                                     equivalent in other currencies), (ii) Notes resold pursuant to
                                                                     Rule 144A Note will be issued in denominations of
                                                                     U.S.$100,000 or its equivalent in other currencies rounded
                                                                     upwards as agreed between the Issuer, Sberbank and the
                                                                     relevant Dealer(s) or integral multiples of U.S.$1,000


                                                                            9
                                                                thereafter and (iii) the minimum denomination of any Notes
                                                                shall be u50,000 (or its equivalent in any other currency as at
                                                                the issue date of the relevant Notes).

Rate of Interest . . . . . . . . . . . . . . . . . . . . .      The Notes may be issued on a fixed rate or a floating rate
                                                                basis.

Fixed Rate Notes . . . . . . . . . . . . . . . . . . . .        Fixed interest will be payable in arrears on the date or dates
                                                                in each year specified in the relevant Final Terms.

Floating Rate Notes . . . . . . . . . . . . . . . . .           Floating Rate Notes will bear interest determined separately
                                                                for each Series and corresponding Loan as follows:
                                                                (i) on the same basis as the floating rate under a notional
                                                                    interest rate swap transaction in the relevant Specified
                                                                    Currency governed by an agreement incorporating the
                                                                    2000 ISDA Definitions, as published by the International
                                                                    Swaps and Derivatives Association, Inc.; or
                                                                (ii) by reference to LIBOR or EURIBOR (or such other
                                                                     benchmark as may be specified in the relevant Final
                                                                     Terms) as adjusted for any applicable margin.

Interest Periods and Interest Rates . . . .                     The length of the interest periods for the Notes and the
                                                                applicable interest rate may differ from time to time or be
                                                                constant for any Series. Notes may have a maximum interest
                                                                rate, a minimum interest rate, or both. The use of interest
                                                                accrual periods permits the Notes to bear interest at different
                                                                rates in the same interest period. All such information will be
                                                                set out in the relevant Final Terms.

Redemption . . . . . . . . . . . . . . . . . . . . . . . .      The relevant Final Terms will specify the basis for calculating
                                                                the redemption amounts payable. Unless permitted by then
                                                                current laws and regulations, Notes that have a maturity of
                                                                less than one year and in respect of which the issue proceeds
                                                                are to be accepted by the Issuer in the United Kingdom or
                                                                whose issue otherwise constitutes a contravention of
                                                                section 19 of the FSMA must have a minimum redemption
                                                                amount of £100,000 (or its equivalent in other currencies).

Issuer’s Restrictions and Covenants . . . .                     So long as any Note remains outstanding, the Issuer will not,
                                                                without the consent of the Trustee, inter alia, incur any other
                                                                indebtedness for borrowed moneys (other than issuing any
                                                                Series of Notes), engage in any business (other than
                                                                transactions contemplated by this Base Prospectus), declare
                                                                any dividends or have any subsidiaries or employees. See
                                                                ‘‘Terms and Conditions of the Notes—4. Restrictive
                                                                Covenants.’’ Furthermore, the Issuer will agree in the Trust
                                                                Deed not to make or consent to any amendment or
                                                                modification or waiver of, or authorise any breach or proposed
                                                                breach of, any Loan Agreement unless the Trustee has given
                                                                consent.

Redemption by the Issuer at the Option
of Sberbank . . . . . . . . . . . . . . . . . . . . . . . . .   In the case of a Senior Series only, the Issuer will redeem the
                                                                Notes in whole, but not in part, at 100% of their aggregate
                                                                principal amount plus accrued and unpaid interest and all
                                                                additional amounts, if any, if Sberbank elects to repay any
                                                                Loan in the event it is required to pay additional amounts on
                                                                account of Russian or Luxembourg withholding taxes in
                                                                respect of certain payments under the corresponding Senior
                                                                Loan or payments under the corresponding Notes or in the


                                                                       10
                                                               event that Sberbank is required to pay additional amounts on
                                                               account of certain costs incurred by the Issuer pursuant to
                                                               the relevant Senior Loan Agreement.
                                                               In the case of a Subordinated Series, the terms of any early
                                                               redemption option of Sberbank are as set out in ‘‘Terms and
                                                               Conditions of the Notes’’ and in the relevant Final Terms.

Optional Redemption by the
Noteholders upon a Change of Control .                         In the case of a Senior Series only, upon the occurrence of a
                                                               Change of Control (as defined in ‘‘Terms and Conditions of
                                                               the Notes—6. Redemption and Purchase’’), the Notes may
                                                               be redeemed at the option of a Noteholder at their principal
                                                               amount, together with accrued interest, if any, all as more
                                                               fully described in the ‘‘Terms and Conditions of the Notes—
                                                               6. Redemption and Purchase.’’

Mandatory Redemption . . . . . . . . . . . . . . .             In limited circumstances as more fully described in the
                                                               relevant Loan Agreement, the Notes may be redeemed by
                                                               the Issuer in whole, but not in part, at any time, upon giving
                                                               notice to the Trustee, at the principal amount thereof,
                                                               together with accrued and unpaid interest and all additional
                                                               amounts, if any, to the date of redemption in the event that
                                                               it becomes unlawful for (i) the Issuer to allow the relevant
                                                               Notes to remain outstanding or (ii) the Issuer or Sberbank to
                                                               allow the relevant Loan to remain outstanding under the
                                                               relevant Loan Agreement. In either case, the Loan would be
                                                               repaid in full on the date notified by the relevant party.

Relevant Events . . . . . . . . . . . . . . . . . . . . .      In the case of a Relevant Event (as defined in the ‘‘Terms and
                                                               Conditions of the Notes—9. Enforcement’’), the Trustee may,
                                                               subject as provided in the Trust Deed, enforce the security
                                                               created in the Trust Deed in favour of the Noteholders.

Withholding Tax . . . . . . . . . . . . . . . . . . . . .      All payments of principal and interest in respect of each
                                                               Series of Notes will be made in full without set-off or
                                                               counterclaim and free and clear of and without deduction for
                                                               or on account of all taxes, which are or will be imposed,
                                                               assessed, charged, levied, collected, demanded, withheld or
                                                               claimed by the Russian Federation or Luxembourg, or any
                                                               taxing authority thereof or therein, other than as required by
                                                               law. If any such taxes, duties and other charges are payable,
                                                               the sum payable by Sberbank to the Issuer under the relevant
                                                               Loan Agreement will (subject to certain exceptions) be
                                                               required to be increased to the extent necessary to ensure
                                                               that the Noteholders receive the net sum which they would
                                                               have received free from any liability in respect of any such
                                                               deduction or withholding, had no such deduction or
                                                               withholding been made or required to be made. The sole
                                                               obligation of the Issuer in this respect will be to pay to the
                                                               Noteholders sums equivalent to the sums received from
                                                               Sberbank.

Further Issues . . . . . . . . . . . . . . . . . . . . . . .   The Issuer may from time to time issue further Notes of any
                                                               Series on the same terms as existing Notes, and such further
                                                               Notes shall be consolidated and form a single Series with
                                                               such existing Notes of the same Series. In the event of such
                                                               further issuance, the principal amount of the relevant Loan
                                                               will be correspondingly increased.


                                                                      11
Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   Application will be made, where specified in the relevant
                                                                    Final Terms, for a Series of Notes to be listed on the London
                                                                    Stock Exchange and traded on the Market or to be listed on
                                                                    such other stock exchange and traded on such other market
                                                                    as shall be specified in the relevant Final Terms, or the Series
                                                                    of Notes will remain unlisted. Application may be made for
                                                                    trading of Rule 144A Notes in PORTAL, as specified in the
                                                                    applicable Final Terms.

Rating . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    Series of Notes issued under this Programme may be rated or
                                                                    unrated. Where a Series of Notes is rated, such rating will not
                                                                    necessarily be the same as the rating assigned to the
                                                                    Programme.
                                                                    Credit ratings assigned to the Notes do not necessarily mean
                                                                    that they are a suitable investment. A rating is not a
                                                                    recommendation to buy, sell or hold securities and may be
                                                                    subject to revision, suspension or withdrawal at any time by
                                                                    the assigning rating organisation. Similar ratings on different
                                                                    types of notes do not necessarily mean the same thing. The
                                                                    ratings do not address the likelihood that the principal on the
                                                                    Notes will be prepaid, paid on an expected final payment date
                                                                    or paid on any particular date before the legal final maturity
                                                                    date of the Notes. The ratings do not address the marketability
                                                                    of the Notes or any market price. Any change in the credit
                                                                    ratings of the Notes or Sberbank could adversely affect the
                                                                    price that a subsequent purchaser will be willing to pay for the
                                                                    Notes. The significance of each rating should be analysed
                                                                    independently from any other rating.
Governing Law . . . . . . . . . . . . . . . . . . . . . .           The Notes will be governed by English law. The provisions of
                                                                    articles 86 to 94-8 of the Luxembourg law of August 10, 1915,
                                                                    as amended, on commercial companies are excluded.

Selling Restrictions . . . . . . . . . . . . . . . . . .            United States, United Kingdom, Russian Federation, Italy,
                                                                    The Netherlands and any other jurisdiction relevant to any
                                                                    Series. See ‘‘Subscription and Sale.’’




                                                                           12
The Senior Loan Corresponding to Each Senior Series of Notes
(If any Series of Notes is a Senior Series it will be specified as such in the relevant Final Terms)

Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    SB Capital S.A.

Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . .      Sberbank.

Security and Ranking . . . . . . . . . . . . . . . .                No Senior Loan will be secured by any collateral. Obligations
                                                                    under the Senior Loan will rank at least pari passu with all
                                                                    other unsecured and unsubordinated financial indebtedness
                                                                    of Sberbank.

Interest Basis Dates . . . . . . . . . . . . . . . . . .            Interest will be payable on a fixed or floating rate basis as
                                                                    specified in the relevant Loan Supplement.

Redemption at the Option
of Sberbank . . . . . . . . . . . . . . . . . . . . . . . . .       Each Senior Loan may be prepaid at Sberbank’s option in
                                                                    whole, but not in part, at any time, at the principal amount
                                                                    thereof, together with accrued and unpaid interest and
                                                                    additional amounts, if any, to the date of repayment, for
                                                                    certain tax reasons or by reason of certain increased costs.

Mandatory Repayments . . . . . . . . . . . . . .                    In the event that it becomes unlawful for the Issuer or
                                                                    Sberbank to fund any Senior Loan or allow such Senior Loan
                                                                    to remain outstanding under the relevant Senior Loan
                                                                    Agreement or allow the corresponding Senior Series of
                                                                    Notes to remain outstanding, Sberbank may be required or
                                                                    entitled to repay such Senior Loan in full.

Redemption upon a Change of
Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   Each Senior Loan may be repaid in whole or in part by
                                                                    Sberbank upon the exercise of the Put Option upon a
                                                                    Change of Control (as defined in ‘‘Terms and Conditions of
                                                                    the Notes—6. Redemption and Purchase’’) by any holder of
                                                                    Notes at the principal amount of the Notes so tendered,
                                                                    together with accrued and unpaid interest and additional
                                                                    amounts, if any.

Certain Restrictions and Covenants . . . .                          The Issuer will have the benefit of certain covenants made by
                                                                    Sberbank all as fully described in the relevant Senior Loan
                                                                    Agreement.

Events of Default . . . . . . . . . . . . . . . . . . . .           In the case of an Event of Default (as defined in the relevant
                                                                    Senior Loan Agreement), the Trustee may, subject as
                                                                    provided in the Trust Deed, require the Issuer to declare all
                                                                    amounts payable under the relevant Senior Loan Agreement
                                                                    by Sberbank to be due and payable.

Use of Proceeds of the Notes . . . . . . . . .                      The Issuer will apply the gross proceeds of the offering of
                                                                    each Senior Series of Notes to fund the corresponding Senior
                                                                    Loan to Sberbank. In connection with the receipt of such
                                                                    Senior Loan, Sberbank will pay an arrangement fee, as
                                                                    reflected in the relevant Final Terms.

Withholding Tax . . . . . . . . . . . . . . . . . . . . .           All payments of principal and interest under each Senior
                                                                    Loan will be made in full without set-off or counterclaim and
                                                                    free and clear of and without deduction for, or on account of,
                                                                    all taxes which are or will be imposed, assessed, charged,


                                                                           13
                                                                   levied, collected, demanded, withheld or claimed by
                                                                   Luxembourg or the Russian Federation, other than as
                                                                   required by law. If any such taxes, duties or other charges are
                                                                   payable in respect of the Senior Loan, the sum payable by
                                                                   Sberbank under the Senior Loan will (subject to certain
                                                                   conditions) be required to be increased to the extent necessary
                                                                   to ensure that the Issuer receives the net sum which it would
                                                                   have received free from any liability in respect of any such
                                                                   deduction or withholding had no such deduction or
                                                                   withholding been made or required to be made.

Governing Law . . . . . . . . . . . . . . . . . . . . . .          Each Senior Loan will be governed by English law.


The Subordinated Loan Corresponding to Each Subordinated Series of Notes (Indicative Terms, Subject
to Change and Supplement, Depending on the Terms of the Relevant Subordinated Loan)
(If any Series of Notes is a Subordinated Series it will be specified as such in the relevant Final Terms)

Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   SB Capital S.A.

Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . .     Sberbank.

Security and Ranking . . . . . . . . . . . . . . . .               No Subordinated Loan will be secured by any collateral. Any
                                                                   rights under the provisions of the Subordinated Loan
                                                                   Agreement against Sberbank in respect of the principal of,
                                                                   and interest on, the Subordinated Loan will be subordinated,
                                                                   in the case of an Event of Default (as defined in the relevant
                                                                   Subordinated Loan Agreement) in accordance with the
                                                                   Federal Law ‘‘On Insolvency (Bankruptcy) of Credit
                                                                   Organisations’’ No. 40-FZ dated February 25, 1999 (as
                                                                   amended), will rank at least pari passu with the claims of
                                                                   other unsecured and subordinated creditors of Sberbank and
                                                                   will be senior to the claims of holders of Sberbank’s share
                                                                   capital.

Interest Basis Dates . . . . . . . . . . . . . . . . . .           Interest will be payable on a fixed or floating rate basis, as
                                                                   specified in the relevant Subordinated Loan Agreement.

Redemption at the Option of
Sberbank . . . . . . . . . . . . . . . . . . . . . . . . . . .     If so provided in the relevant Subordinated Loan Agreement
                                                                   and subject to the conditions set out therein, each
                                                                   Subordinated Loan may be prepaid at Sberbank’s option in
                                                                   whole, but not in part, at any time, at the principal amount
                                                                   thereof, together with accrued and unpaid interest and
                                                                   additional amounts, if any, to the date of repayment, for
                                                                   certain tax reasons or by reason of certain increased costs.

Mandatory Repayments . . . . . . . . . . . . . .                   If so provided in the relevant Subordinated Loan Agreement
                                                                   and subject to the conditions set out therein, in the event that
                                                                   it becomes unlawful (i) for the Issuer to allow the Notes
                                                                   funding such Subordinated Loan to remain outstanding, or
                                                                   (ii) for the Issuer or Sberbank to allow such Subordinated
                                                                   Loan to remain outstanding under the relevant Subordinated
                                                                   Loan Agreement. Sberbank may be required or entitled to
                                                                   repay such Subordinated Loan in full on the date notified by
                                                                   the relevant party.


                                                                          14
Events of Default . . . . . . . . . . . . . . . . . . . .   In the case of an Event of Default (as defined in the relevant
                                                            Subordinated Loan Agreement), the Trustee may, subject as
                                                            provided in the Trust Deed, take the action permitted to be
                                                            taken by the Issuer under such Subordinated Loan
                                                            Agreement.

Use of Proceeds of the Notes . . . . . . . . .              The Issuer will apply the gross proceeds of the offering of
                                                            each Subordinated Series of Notes to fund the corresponding
                                                            Subordinated Loan to Sberbank. In connection with the
                                                            receipt of such Subordinated Loan, Sberbank will pay an
                                                            arrangement fee, as reflected in the relevant Final Terms.

Withholding Tax . . . . . . . . . . . . . . . . . . . . .   All payments of principal and interest under each
                                                            Subordinated Loan will be made in full without set-off or
                                                            counterclaim and free and clear of, and without deduction for
                                                            or on account of, all taxes which are or will be imposed,
                                                            assessed, charged, levied, collected, demanded, withheld or
                                                            claimed by Luxembourg or the Russian Federation, other
                                                            than as required by law. If any such taxes, duties or other
                                                            charges are payable in respect of the Subordinated Loan, the
                                                            sum payable by Sberbank under the Subordinated Loan will
                                                            (subject to certain conditions) be required to be increased to
                                                            the extent necessary to ensure that the Issuer receives the net
                                                            sum that it would have received, free from any liability in
                                                            respect of any such deduction or withholding, had no such
                                                            deduction or withholding been made or required to be made.

Governing Law . . . . . . . . . . . . . . . . . . . . . .   Each Subordinated Loan Agreement will be governed by
                                                            English law.




                                                                   15
                                               RISK FACTORS
Prospective investors should consider carefully, among other things, the risks set forth below and the other
information contained in this document prior to making any investment decision with respect to the Notes.
In a number of situations, which Sberbank cannot always control, these risks may come to pass and may
have a negative effect on Sberbank’s ability to service payment obligations under any Loan Agreement and,
as a result, on the Issuer’s ability to service payment obligations on any Series of Notes. In addition, the value
of the Notes could decline due to any of these risks, and the Noteholders may lose some or all of their
investment.
Prospective investors should note that the risks described below are not the only risks Sberbank faces.
Sberbank has described only the risks it considers to be material. However, there may be additional risks that
Sberbank currently considers immaterial or of which it is not currently aware, and any of these risks could
have the effect set forth above.
Risks Relating to Sberbank’s Business and Industry
Competition in the retail deposit market
Throughout its history, Sberbank has had the largest market share in the Russian retail deposit market.
During the last decade, Sberbank attained its greatest retail deposit market share following the 1998
Russian financial crisis, when it provided services to depositors of certain insolvent banks and banks facing
financial difficulties. According to Sberbank’s calculations, it had a 76% market share in retail deposits as
of January 1, 2001. While Sberbank continues to retain the dominant market share in rouble, as well as
foreign currency retail deposits, its market share has been declining and, according to Sberbank’s
calculations, was 54% as of December 31, 2005. The decline is largely a result of the differences in market
priorities of Sberbank and other banks. While Sberbank has focused on developing long-term retail
deposit products, which has allowed it to increase substantially the volume of long-term funding and
develop long-term lending, other banks have concentrated on attracting lower-cost short-term retail
deposits. Sberbank believes that the volume of the short-term deposit market in Russia exceeds the
volume of the long-term deposit market, resulting in a decline in Sberbank’s overall retail deposit market
share. Sberbank’s market share recently declined as a result of the development of retail branch networks
by some major Moscow and regional banks, since intensive development of a bank’s branch network
usually results in an increase in its retail deposits.
Sberbank constantly monitors the Russian country-wide and regional retail deposit markets and changes
the range of its deposit products and adjusts its interest rates in order to maintain its competitive position.
The range of Sberbank’s retail deposit services is growing, allowing it to maintain and strengthen its
leading market position and to continue to increase its funding base. However, no assurance can be given
that these measures will allow Sberbank to maintain its current market position.
In January 2005, Sberbank was accepted for participation in the Russian retail deposit insurance system
established by the Federal Law of December 23, 2003 No. 177-FZ ‘‘On Insurance of Deposits of
Individuals in Banks of the Russian Federation’’ (the ‘‘Deposit Insurance Law’’), which requires
protection of deposits in all participating Russian banks up to RUR100,000. See ‘‘—Risks Relating to the
Russian Legal System and Russian Legislation—Significant changes in Russian banking and financial
regulation.’’
Creation of a branch network in Russia comparable in size to Sberbank’s by any of its competitors appears
highly unlikely in the near future. Therefore, Sberbank believes that it will retain its leading position in
the retail market and that retail deposits will continue to constitute a significant source of its funding.
However, as retail deposits are one of the most expensive funding sources in the Russian market, a certain
decrease in Sberbank’s retail deposit market share should not adversely affect its financial condition.
Sberbank incurs material expenses as a result of making mandatory contributions to the deposit insurance
fund established by the Deposit Insurance Law. Sberbank’s expenses for mandatory contributions to the
deposit insurance fund amounted to RUR7.7 billion in 2005 and Sberbank expects the 2006 expenses to
amount to approximately RUR10.0 billion. Sberbank is actively developing its lending operations,
including retail lending, and believes that revenues from these operations will offset the negative effect
of the deposit insurance fund contributions on its results of operations.
Sberbank faces competition in providing banking services to legal entities
The development of cross-border lending has resulted in intense competition for servicing cash flows and
providing lending services to major Russian enterprises and exporters. Major international banks have

                                                       16
expanded rapidly in the Russian markets, offering financing at a comparatively low cost to Russian
corporate borrowers. In addition, in the last several years, Russian banks have been able to expand the
volume of corporate lending using relatively inexpensive funding raised in the international financial
markets. Both international and Russian banks have also been expanding the range and volume of
corporate banking services other than lending that they offer to Russian corporate clients. As a result,
Sberbank has to compete with such banks to provide banking services to the best Russian corporate
clients.
Sberbank believes that improving the range and volume of its corporate client services will permit it to
retain or enlarge its presence in the corporate banking services market. Nevertheless, there can be no
assurance that, as a result of expansion of corporate banking services in Russia by Russian and
international banks, Sberbank will not lose a portion of its lending business and some of its funding
sources (including deposits from legal entities), which may have a material adverse effect on its financial
condition, results of operations and prospects.
Competition in all segments of the Russian banking market is intensifying
Sberbank occupies a leading but not dominant position in all segments of the Russian banking market
other than the retail deposit and the retail lending markets and is facing competition in a number of areas
from banks and other enterprises. For example, in the money transfer market Sberbank competes with
Western Union, the Russian federal postal service and other banks, and in the cash handling market it
competes with Rosincass. A number of Russian banks are active in the retail lending market, and
competition among providers of plastic cards, depositary services and asset management services is also
intensifying.
Sberbank believes that its business strategy should result in maintaining or increasing its current share in
most segments of the Russian banking market. At the same time, growing competition compels Sberbank
to continue to make considerable investments in developing its infrastructure, upgrading its technology,
automating its operations and re-training its personnel, thereby increasing its expenses.
Declining interest rate margins, securities market volatility and adverse interest rate and currency movements
may affect Sberbank’s profitability
In recent years, the Russian economy has grown at a stable pace. The rate of inflation is slowing, the
rouble is generally strengthening against U.S. dollar in both real and nominal terms and the real income
and purchasing power of the population are growing steadily. These positive economic trends, combined
with the growth in foreign investment, the development of cross-border operations and the increasing
opportunities for legal entities to obtain funding in the international capital markets, have resulted in a
decline in interest rates and a decrease in interest rate spreads and bank margins in Russia. Interest rates
in Russia reached historically low levels in 2004, in large part due to the stabilisation of Russia’s economy
and the resulting credit rating upgrades of Russia by the leading rating agencies and generally low levels
of interest rates in the international financial markets, although the interest rates in Russia rose slightly
in 2005.
In order to counteract the decline in interest rate spreads and adverse interest rate movements, Sberbank
is actively developing retail as well as small and medium business lending, is taking measures to diversify
its sources of funding and is expanding lower-cost funding sources such as salary payment schemes and
debit cards. It has also sought to compensate for the decreasing interest rate spreads by developing
fee-based operations and increasing non-interest income, as well as optimising its cost structure and
reducing its cost to income ratio. Nevertheless, there can be no assurance that these strategies will fully
protect Sberbank and that adverse interest rate movements will not affect its profitability. In addition,
Sberbank has procedures to manage its interest rate risk associated with lending and transactions in
securities, including interest rate policies for various banking operations, limits on transactions in
securities and stop-loss limits. See ‘‘Business—Asset, Liability and Risk Management—Risk Management
—Market Risks—Interest Rate Risk.’’ Nevertheless, there can be no assurance that these strategies and
procedures will fully protect Sberbank and that adverse interest rate movements will not affect its
profitability.
Sberbank engages in significant proprietary securities operations and derives a significant portion of its
operating income from such operations. Sberbank has placed limits on the types and maturities of the
securities in its trading portfolio, which are designed to maintain the risk associated with the volatility of
prices of securities at an acceptable level. However, adverse price and interest rate movements may affect
Sberbank’s profitability. The main source of this risk is Sberbank’s portfolio of Russian government debt
securities.

                                                     17
Sberbank trades currency on behalf of its clients and for its own account and maintains open currency
positions, which gives rise to exposure to currency risk. Although Sberbank has procedures and limits in
place aimed at reducing currency risk and adheres to the CBR limits on open currency positions, volatility
in currency exchange rates and of various currencies, particularly the U.S. dollar, may adversely affect
Sberbank. See ‘‘Business—Asset, Liability and Risk Management—Risk Management—Market Risks—
Currency Risk.’’

Sberbank bears significant credit risk
Sberbank bears significant credit risk and continues to improve its credit risk control and management
systems. See ‘‘Business—Asset, Liability and Risk Management—Risk Management—Credit Risk.’’ In
2005, 25% of Sberbank’s gross loan portfolio (before taking into account loan impairment) consisted of
loans to individuals, and a downturn in the Russian economy may affect individuals’ ability to repay their
loans and thus adversely affect Sberbank’s financial condition and results of operations. In addition,
because of its large funding and capital base, Sberbank has the ability to extend large loans to Russia’s
largest and most successful companies. Although extending such loans results in relatively high credit risk
concentrations and high levels of exposure to borrowers in some industry sectors, such as trade and
services, Sberbank believes, on the basis of its internal credit rating models and other credit risk
evaluation methodologies for large corporate borrowers, that its current level of credit risk concentration
is acceptable. Sberbank currently meets credit risk norms set by the CBR. Nevertheless, a downturn in
one or all of the industries in which Sberbank’s largest borrowers operate may also negatively affect
Sberbank’s financial condition and results of operations.
Sberbank is focusing on establishing relationships with additional corporate borrowers and on providing
lending services to medium-sized business clients and small businesses. See ‘‘Business—Business
Strategy— Banking Services to Corporate Clients.’’ Sberbank’s increased lending to medium-sized
business clients and small businesses expands and diversifies its loan portfolio and increases its
profitability because higher interest rates can be charged on such loans. At the same time, lending to
medium-sized business clients and small businesses can increase Sberbank’s credit risk exposure. Such
lending can carry a greater risk of default than lending to large corporate clients. It can also lead to an
increase in overdue amounts and, consequently, to higher loan impairment provisions.
Sberbank’s market share in lending services to companies operating in some sectors of the Russian
economy is already such that its ability to increase its business may be restricted by exposure limits and
other risk management norms. The inability to expand its lending business in these areas could have a
negative impact on Sberbank’s results of operations and financial condition.
Although Sberbank continues to seek to diversify its loan portfolio and improve its credit risk
management practices, there can be no assurance that its credit risk levels will not increase.

Sberbank cannot completely eliminate liquidity risk
Sberbank is exposed to daily calls on its available cash resources from overnight deposits, current
accounts, maturing deposits, loan draw downs, guarantees and from margin and other calls on cash-settled
derivative instruments. Nevertheless, Sberbank does not maintain cash resources to meet all of these
needs, as the statistical information that it has compiled based on its experience shows that a minimum
level of reinvestment of maturing funds can be predicted with a high level of certainty. Sberbank has
introduced liquidity risk management procedures and analyses its assets through scenario analysis and
stress testing. See ‘‘Business—Asset, Liability and Risk Management—Risk Management—Liquidity
Risk.’’ Nevertheless, Sberbank cannot completely eliminate liquidity risk.
The Russian Civil Code (the ‘‘Civil Code’’) allows immediate withdrawal of retail deposits, including term
deposits, at any time. To account for this requirement, Sberbank holds liquidity reserves in excess of the
regulatory minimum. However, there can be no assurance that unplanned withdrawals of deposits by
Sberbank’s clients, permitted by the Civil Code, will not lead to liquidity gaps that Sberbank will have to
cover, thus incurring additional expenses.

Sberbank’s risk management strategies and techniques may not identify some risks
Although Sberbank invests substantial time and effort in its risk management strategies and procedures
and has historically had low default and impairment provision levels, its risk management strategies and
procedures may nevertheless fail under some circumstances, particularly when confronted with risks that
it has not identified or anticipated.

                                                      18
Some of Sberbank’s risk management methods are based upon observations of historical market
behaviour, including the behaviour of all Russian market sectors during the 1998 crisis. Sberbank applies
statistical techniques to these observations to quantify its risk exposures. See ‘‘Business—Asset, Liability
and Risk Management—Risk Management.’’ However, in developing its statistical models, Sberbank may
not identify or anticipate some circumstances and may not take all risks into account. If Sberbank’s
measures to assess and mitigate risks prove insufficient, its losses may be greater than expected.

Interests of Sberbank’s shareholders may conflict with those of the Noteholders
Under Russian banking legislation and Sberbank’s charter, the CBR must hold a controlling stake (at least
50% plus one voting share) in Sberbank. As of December 31, 2005, the CBR owned 63.8% of Sberbank’s
ordinary shares and 60.6% of its total share capital (which consists of ordinary and preference shares) and
is thus its controlling shareholder. The representatives of the CBR hold seven, the representative of the
Russian government hold three, and a representative of the Russian President holds one, of the 16 seats
on Sberbank’s Supervisory Board. Two other seats are held by representatives of Sberbank and three by
independent members that are not affiliated with the CBR, the Russian government or Sberbank. The
Chairman of the CBR serves as Chairman and the two First Deputy Chairmen of the CBR serve as
Deputy Chairmen of Sberbank’s Supervisory Board.
During the last ten years, Sberbank has not experienced any administrative pressure from the CBR or the
Russian government to extend loans or to provide preferential interest rates or prices to particular clients.
Sberbank makes all its lending decisions on the basis of an analysis of the economic benefits and risks of
a transaction. Its participation (including lending and certain fee-based services) in state economic or
social programmes is driven by considerations of profitability and economic expediency.
Nevertheless, Russian legislation gives considerable powers to controlling shareholders and even greater
powers to Supervisory Boards, and there can be no assurance that in the future the interests and actions
of the CBR or its representatives on the Supervisory Board will be aligned with the interests of
Noteholders.

Sberbank faces technological risks
Sberbank’s banking business requires the development of communication channels and software, the
creation of large automated systems and considerable computer capacity throughout Russia. Sberbank
positions itself as a universal commercial bank that offers high quality services to clients in all Russian
regions and seeks to ensure the same technological capabilities for all of its business units. Matching the
capacities of its information systems, network and technologies to the pace of its business development
requires considerable expenditure. See ‘‘Business—IT Infrastructure.’’
The expansion of its operations and the introduction of new technologies results in correspondingly
greater risks, since the financial consequences of any failure of equipment, networks or software become
more severe.
Sberbank is investing considerable time and money to upgrade its technologies, centralise its information
systems, create appropriate reserves and duplicating capacities, develop internal audit functions and
control the operation of its hardware and software, all in a timely way and taking into account
international best practices. Nevertheless, Sberbank cannot guarantee that such upgrades will be carried
out or that it can fully eliminate the possibility of a systems failure that may, for some time, adversely
affect its operational activities and lead to expenses that may adversely affect its financial performance.

Competition for well-trained and experienced personnel
Sberbank’s success depends in part on its continued ability to attract, retain and motivate qualified and
experienced banking and management personnel. Rapid expansion of the demand for modern high-
quality banking services has required Sberbank to increase its expenditure on the selection, training and
retention of personnel. Sberbank formulates its personnel policies on the basis of analysis of main factors
affecting the labour market for banking professionals, such as average salaries and qualification levels.
Sberbank constantly monitors the labour market, analyses its developing trends and evaluates the level
of demand for banking professionals, financial and non-financial compensation levels and compensation
policies of competing banks.
Sberbank strives to recruit and retain qualified staff at all points of sale of banking products and services
throughout Russia. However, competition in the Russian banking industry for personnel with relevant

                                                     19
expertise is intense, especially in regions outside Moscow, due to the relatively small number of available
qualified individuals compared to the demand. In order to recruit qualified and experienced employees
and to minimise the possibility of their departure to other banks, Sberbank attempts to provide attractive
compensation packages in a manner consistent with evolving standards in the Russian labour market. As
a result, its operational costs may be greater than expected. Sberbank also provides internal and external
training opportunities and uses other methods of personnel development. See ‘‘Business—Business
Strategy—Internal Development—Employee Development’’ and ‘‘Business—Employees.’’ Nevertheless,
Sberbank may fail to recruit and/or retain necessary personnel or manage its personnel needs successfully
and that could adversely affect its business, financial condition, results of operations and prospects.

Risks Relating to Russia
Sberbank is a Russian bank, and all of its fixed assets are located in, and most of its revenues are derived
from, Russia. There are certain risks associated with an investment in Russia.

Political risks
Sberbank believes that an analysis of Russia’s economic development for the last decade suggests that the
volume of foreign investment in Russia is, among other things, correlated with the level of the country’s
political stability. Since Vladimir V. Putin’s election as President of Russia in 2000, capital movement
balances have improved. In 2005, according to the CBR, Russia had a net capital inflow in the private
sector of U.S.$0.3 billion compared with a net capital outflow in the private sector of U.S.$8.0 billion in
2004. According to the Federal Service for State Statistics, the volume of foreign investment into Russia
in 2005 amounted to U.S.$53.7 billion, having increased by 32.4% as compared to 2004.
Future changes in the government and major policy shifts could disrupt or reverse economic and
regulatory reforms that have taken place in Russia to date. See also ‘‘—Social and economic risks,’’
‘‘—Changes in the Russian tax system’’ and ‘‘—Risks Relating to the Russian Legal System and Russian
Legislation.’’ Nevertheless, Sberbank believes that political destabilisation of the magnitude that could
lead to a decline in the volume of investments in Russia and the prices of Russian securities, including the
Notes, is unlikely to occur in the foreseeable future.

Social and economic risks
Since the dissolution of the Soviet Union, Russia has, at various times, experienced:
•   significant declines in gross domestic product;
•   hyperinflation;
•   an unstable currency;
•   high state debt relative to gross domestic product;
•   significant use of barter transactions and illiquid promissory notes to settle commercial transactions;
•   widespread tax evasion;
•   growth of ‘‘black’’ and ‘‘grey’’ market economies;
•   high levels of capital flight;
•   corruption and extensive penetration of organised crime into the economy;
•   social and governmental instability;
•   lack of consensus between federal and local governments;
•   ethnic and religious tensions;
•   significant increases in unemployment and underemployment;
•   high poverty levels among the population; and
•   outdated physical infrastructure.
The Russian economy has been subject to abrupt downturns. In particular, on August 17, 1998, in the face
of a rapidly deteriorating economic situation, the government defaulted on its rouble-denominated
securities, the CBR stopped its support of the rouble and a temporary moratorium was imposed on certain

                                                     20
hard currency payments. These actions resulted in an immediate and severe devaluation of the rouble and
a sharp increase in the rate of inflation, a dramatic decline in the prices of Russian debt and equity
securities and an inability of Russian issuers to raise funds in the international capital markets. These
problems were aggravated by the near collapse of the Russian banking sector.
During the crisis of 1998, Sberbank demonstrated its ability to remain stable and to fulfil its obligations.
Despite a sizeable volume of its retail deposits being withdrawn and many of its large clients having
financial problems, Sberbank fulfilled all of its obligations, including the timely repayment in
December 1998 of a syndicated loan extended by foreign banks in the amount of U.S.$225 million.
Sberbank also met all its other obligations to foreign counterparties.
The Russian economic situation has improved significantly since the 1998 crisis. The gross domestic
product is steadily growing at relatively high rates, the rouble has been relatively stable against the U.S.
dollar, the rate of inflation has been reduced and the CBR has accumulated substantial hard currency
reserves comparable to those of more developed economies. The Russian economy has been helped in
recent years by high prices for its commodity exports, including oil, gas, ores and metals.
In the summer of 2004, the Russian banking sector experienced market instability caused by the
revocation of banking licenses from several small Russian banks. It resulted in a decrease of small banks’
credibility among their clients, which in turn resulted in liquidity problems at some banks. However, due
to certain measures taken by the CBR since the summer of 2004 (the reduction of mandatory reserve
requirements, approval of the law guaranteeing deposits with banks not admitted to the deposit insurance
system and improvement of the refinancing system), the instability has been eliminated.
Sberbank believes that the inflation rate in Russia is still high compared with that in developed economies.
Periodic strengthening of the rouble relative to the U.S. dollar also makes prices of Russian goods less
competitive, and the economy is still dependent on international oil and natural gas prices. There can also
be no assurance that the recent positive trends experienced by the Russian economy will continue or will
not be reversed. Therefore, Sberbank has included in its scenario analyses and stress tests macroeconomic
scenarios with adverse effects comparable to the effects of the 1998 crisis. Sberbank closely monitors the
possible adverse effects on Sberbank’s business, financial condition and results of operations due to such
events. See ‘‘Business—Asset, Liability and Risk Management—Risk Management.’’ Nevertheless, there
can be no assurance that a decline in the international oil and gas prices, a further strengthening of the
rouble against the U.S. dollar, increasing level of capital flight or other factors negatively affecting the
Russian economy will not, separately or together, have an adverse effect on Sberbank’s financial
condition, results of operations and prospects, and on the value of the Notes.
Changes in the Russian tax system
Russian tax laws and regulations are subject to frequent change, varying interpretation and inconsistent
and selective enforcement. In some past instances, although it may be viewed as contradictory to Russian
constitutional law, Russian tax authorities have applied certain taxes retroactively, issued tax claims for
periods for which the statute of limitations had expired and reviewed the same tax period multiple times.
In addition to the usual tax burden imposed on Russian taxpayers, these conditions complicate tax
planning and related business decisions. On July 14, 2005, the Russian Constitutional Court issued a
decision that allows the statute of limitations for tax liabilities to be extended beyond the three-year term
set forth in the tax laws if a court determines that the taxpayer has obstructed or hindered a tax inspection.
As none of the relevant terms is defined, tax authorities may have broad discretion to argue that a
taxpayer has ‘‘obstructed or hindered’’ an inspection and ultimately seek penalties beyond the three-year
term. In addition, tax laws are unclear with respect to deductibility of certain expenses. This uncertainty
could possibly expose Sberbank to significant fines and penalties and to enforcement measures, despite
Sberbank’s best efforts at compliance, and could result in a greater than expected tax burden.
Despite the Russian government taking steps to reduce the overall tax burden in recent years in line with
its objectives, Russia’s largely ineffective tax collection system and continuing budgetary funding
requirements increase the likelihood that arbitrary or onerous taxes and penalties in the future may be
imposed in the future, which could have a material adverse effect on the Sberbank’s business, financial
condition, results of operations or prospects.
Transfer pricing legislation became effective in the Russian Federation on January 1, 1999. This legislation
allows the tax authorities to make transfer pricing adjustments and impose additional tax liabilities in
respect of all ‘‘controlled’’ transactions, provided that the transaction price differs from the market price
by more than 20%. ‘‘Controlled’’ transactions include transactions with related parties, barter transactions,

                                                     21
foreign trade transactions and transactions with unrelated parties with significant price fluctuations (i.e.,
if the price of such transactions differs from the prices on similar transactions by more than 20% within
a short period of time). Transfer pricing adjustments are also applicable to the trading of securities and
derivatives. There has been no formal guidance (although some court precedents are available) as to how
these rules will be applied.
The Russian tax legislation and or practice may change in a way that may affect Sberbank overall tax
efficiency and may result in significant additional taxes becoming payable. Sberbank cannot give any
assurance that additional tax exposures will not arise while the Notes are outstanding. The risks described
above could have a material adverse effect on the Sberbank’s business, financial condition, results of
operations or prospects.
Fluctuations in the global economy
Russia’s economy is vulnerable to market downturns and economic slowdowns elsewhere in the world. As
has happened in the past, financial problems or an increase in the perceived risks associated with investing
in emerging economies could affect the Russian economy.
Additionally, many of Sberbank’s large clients are primarily engaged in the production and/or export of
oil, gas, ores and metals. The financial condition of each of these large clients depends partly on the prices
of the relevant commodities. A decrease in the prices of these commodities and currency exchange, or an
increase in production costs that is not offset by a corresponding price increase, may negatively affect the
financial condition of such large clients and may result, among other things, in a decrease in the funds that
such clients hold on deposit with Sberbank, a reduction in the volume of foreign currency and/or
investment operations that these clients carry out with Sberbank, as well as possible defaults, or the need
for increased allowances, in respect of their obligations to Sberbank.
These developments in the global economy and global markets could have an adverse effect on
Sberbank’s financial condition, results of operations and prospects and the trading price of the Notes.
Risks Relating to the Russian Legal System and Russian Legislation
Weaknesses relating to the Russian legal system and Russian legislation
Russia is still developing the legal framework required by a market economy. Since 1991, Soviet law has
been largely, but not entirely, replaced by a new legal regime established under the 1993 federal
Constitution. Sberbank’s business is subject to the rules of the Civil Code, other federal laws and decrees,
orders and regulations issued by the President, the Russian government and the CBR, which are in turn
complemented by regional and local rules and regulations. Several fundamental Russian laws have only
recently become effective. Thus, the Federal Law on Credit Histories generally entered into force on
June 1, 2005, the Federal Law on Currency Regulation and Currency Control and the Federal Law on the
Fundamentals of State Regulation of Foreign Trade Activity generally entered into force in June 2004, the
Federal Law on Bankruptcy became generally effective on December 2, 2002 and the restated Federal
Law on Counteracting to Money Laundering became effective on January 2, 2003.
The recent nature of much Russian legislation and the rapid evolution of the Russian legal system casts
doubt on the enforceability and underlying constitutionality of certain laws and results in ambiguities,
inconsistencies and anomalies. Russia is a civil law jurisdiction and, as such, judicial precedents have no
binding effect on subsequent decisions. Sometimes, judges and courts of the first instance are inexperienced
in business and corporate law. Moreover, enforcement of court judgments can in practice be very difficult
in Russia. In addition, Russian legislation often leaves substantial gaps in the regulatory infrastructure.
Among the risks of the current Russian legal system are limited judicial and administrative guidance on
interpreting Russian legislation, the relative inexperience of judges in interpreting Russian legislation, the
relative lack of independence of the judiciary, corruption and bankruptcy procedures that are not well
developed and are subject to abuse. No assurance can be given that Noteholders will have their rights, or
that the Issuer will have its rights, upheld in a Russian court.
Significant changes in Russian banking and financial regulation
Like most of Russia’s legislation on business activities, Russia’s laws on banks and banking activity have
only recently been adopted. In addition to the Federal Law of July 10, 2002, No. 86-FZ ‘‘On the Central
Bank of the Russian Federation (Bank of Russia),’’ as amended (the ‘‘CBR Law’’), and the Federal Law
of December 2, 1990, No. 395-I ‘‘On Banks and Banking Activity,’’ as amended, (the ‘‘Banking Law’’),
Russia has adopted and continues to develop new banking legislation.

                                                     22
In December 2003, President Putin signed into law the Deposit Insurance Law, which requires the
protection of bank deposits of individuals of up to RUR100,000 for each client per bank and requires that
banks make quarterly payments into a deposit insurance fund. The Deposit Insurance Law establishes a
deposit insurance scheme in which all Russian banks must participate or lose their ability to accept retail
deposits and open bank accounts for individuals. The enactment of the Deposit Insurance Law
strengthens competition in the retail deposit market as all Russian banks that choose to participate in the
deposit insurance scheme will have the ability to offer protected deposits. Sberbank was accepted into the
deposit insurance system in January 2005.
The CBR has also been developing regulations on bank capital and bringing them into line with
international standards.
The recent changes in the Russian banking and financial regulation, including changes in mandatory
reserve requirements and regulatory ratios, are aimed at bringing the regime more in line with those of
more developed countries. It is difficult to forecast how the changes in banking and financial regulation
will affect the Russian banking system, and no assurance can be given that the regulatory system will not
change in a way that will increase Sberbank’s expenses.

Currency control regime
On June 18, 2004, most of the provisions of the Federal Law ‘‘On Currency Regulation and Currency
Control’’ No. 173-FZ as amended (the ‘‘Currency Law’’) came into force. While the Currency Law is
generally aimed at the gradual liberalisation of Russian currency control regulations, it only establishes
a broad regulatory framework and gives the government and the CBR significant discretion in adopting
implementing regulations for currency operations in Russia. The Currency Law introduced some new
forms of currency control, such as the establishment of mandatory reserves placed in non-interest bearing
rouble accounts and the use of special accounts. The CBR and the government have implemented a
number of regulations under the Currency Law, and other such regulations are expected in the near
future.
It is not clear whether the CBR will enact further regulations relating to special accounts of credit
organisations or whether any mandatory reserves requirements would apply to Russian credit institutions.
For example, under the Currency Law, the CBR has the authority to adopt regulations that would require
Russian borrowers (including banks) to reserve up to 20% of the amount of foreign currency loans
received from foreign lenders for a period of up to one year, and that would require Russian lenders to
reserve up to 100% of the amount of their foreign currency loans extended to foreign borrowers for a
period of up to sixty days. In addition, Russian banks may be required to post reserves at the CBR in
connection with operations not covered by their banking licenses, including securities operations.
Currently, Russian borrowers reserve 2% of the rouble equivalent of the amount of foreign currency loans
received from foreign lenders for 365 days, and Russian lenders reserve 25% of the rouble equivalent of
the amount of their foreign currency loans extended to foreign borrowers for 15 days. Under the
applicable CBR regulations, the mandatory reserves and special account requirements do not apply to
credit institutions. In addition, according to the CBR, from May 1, 2006, mandatory reserve requirements
for foreign currency operations related to inflows and outflows of capital will be reduced, and the
mandatory sales of a portion of foreign currency earnings will be abolished, which, in Sberbank’s view,
indicates further liberalisation of currency control regulations.
Nevertheless, in spite of the gradual liberalisation of the currency control regime, implementation of some
of these changes by the Russian government and the CBR may make certain foreign currency operations
burdensome and financially unattractive for Russian banks and their clients.

Recognition of foreign judgments in Russia
Judgments rendered by a court in any jurisdiction outside Russia are likely to be recognised by courts in
Russia only (i) if an international treaty providing for the recognition and enforcement of judgments in
civil cases exists between Russia and the country where the judgment is rendered and/or (ii) a federal law
of Russia providing for the recognition and enforcement of foreign court judgments is adopted. No such
federal law has been passed and no such treaty exists between the United States and Russia or the United
Kingdom and Russia for the reciprocal enforcement of foreign court judgments in civil matters. Thus, the
enforcement of the court judgments rendered in these countries against Sberbank in Russia may be
impossible. Also, the Facility Agreement and each Subordinated Loan Agreement provide that
controversies, claims and causes of action brought by any party thereto may be settled by arbitration. The

                                                    23
Russian Federation is a party to the United Nations (New York) Convention on the Recognition and
Enforcement of Foreign Arbitral Awards of 1958. However, it may be difficult to enforce arbitral awards
in the Russian Federation due to a number of factors, including a lack of experience of Russian courts in
international commercial transactions, official and unofficial political resistance to the enforcement of
awards against Russian companies in favour of foreign investors, the Russian courts’ inability to enforce
such orders, and corruption.
Furthermore, any arbitral award pursuant to arbitration proceedings in accordance with the Rules of the
LCIA and the application of English law to the Facility Agreement, any Subordinated Loan Agreement
or any Loan Agreement may be limited by the mandatory provisions of Russian laws relating to the
exclusive jurisdiction of Russian courts and the application of Russian laws with respect to bankruptcy,
winding up or liquidation of Russian companies and credit organisations in particular.
Russian bankruptcy law differs from comparable law in Western European countries
Russian bankruptcy laws often differ from comparable laws in Western European countries and may be
subject to varying interpretations. There is little precedent to predict how claims on behalf of the
Noteholders or the Issuer against Sberbank would be resolved in the case of Sberbank’s bankruptcy. In
addition, under Russian law, Sberbank’s obligations under each Loan Agreement would be subordinated
in the event of its insolvency to the following obligations:
•   claims against Sberbank related to the administration of insolvency proceedings, including salaries of
    personnel involved in insolvency proceedings, utility bills, legal expenses and other payments;
•   first priority claims against Sberbank, including:
    –    claims in tort for damages in respect of physical persons’ life or health, as well as moral damages;
    –    claims of retail depositors and individuals holding current accounts (except for individual
         entrepreneurs);
    –    claims of the Deposit Insurance Agency in respect of deposits and current accounts transferred
         to it pursuant to the Deposit Insurance Law; and
    –    claims of the CBR relating to the CBR’s payments to retail depositors of insolvent credit
         organisations that are not participants in the deposit insurance system;
•   second priority claims against Sberbank, i.e., claims under employment contracts and other social
    benefits and copyright claims; and
•   claims against Sberbank secured by a pledge of the credit organisation’s assets. Any residual claims
    of secured creditors that remain unsatisfied after the sale of such collateral rank pari passu with
    claims of unsecured creditors.
In the event of Sberbank’s insolvency, the subordination of obligations under each Loan Agreement, as
described above, may substantially decrease the amounts, if any, available for repayment of any Loan and,
as a result, the corresponding Series of Notes. In addition, under Russian law, Sberbank’s obligations
under any Subordinated Loan Agreement, and as a result, the corresponding Series of Notes would be
subordinated to the claims of its unsubordinated creditors. See ‘‘—Risks relating to the Notes and the
Trading Market—Subordination of payment obligations under Subordinated Loans.’’ See also ‘‘The
Banking Sector and Banking Regulation in Russia—Insolvency of Credit Organisations—Priority of
Claims.’’
Rights of Sberbank’s shareholders and certain reporting requirements
Sberbank’s corporate affairs are governed by its charter, its internal regulations, laws governing Russian
banks and laws governing companies incorporated in Russia. See ‘‘The Banking Sector and Banking
Regulation in Russia.’’ The rights of shareholders and the responsibilities of members of Sberbank’s
Supervisory Board and Sberbank’s Board under Russian law are different from, and may be subject to,
certain requirements not generally applicable to corporations organised in the United Kingdom or other
jurisdictions. See ‘‘Management.’’
The Banking Law contains certain regular disclosure requirements, including the requirement to publish
annual financial statements in accordance with RAR. Sberbank has voluntarily published IFRS annual
financial statements since 1996. Due to the fact that Sberbank’s systems and processes are tailored for
Russian statutory requirements, it takes Sberbank longer than most Western companies to prepare its
consolidated annual and interim financial reports and its periodic internal accounts.

                                                    24
In accordance with the Banking Law and CBR regulations, Sberbank must publish quarterly reports
within 40 business days and file them with the CBR within 43 days following the occurrence of the
relevant reporting date. Such reports, which are prepared in accordance with Russian statutory
requirements, include certain financial information, including a balance sheet, income statement and
information on its assets, capital reserves and allowances for problem loans in its RAR financial
statements, but do not contain all of the information contained in Sberbank’s IFRS financial statements.
Sberbank has complied with these reporting requirements.
In accordance with Russian legislation applicable to securities issuers, Sberbank must file quarterly
reports with the CBR within 45 days after the end of the relevant quarter. Such reports include certain
information about Sberbank, its management, subsidiaries, affiliates, selected financial and business
information (such as events of litigation and quarterly financial statements prepared in accordance with
RAR), but do not contain all of the information contained in Sberbank’s IFRS financial statements.

Approval requirements with respect to the transactions between Sberbank and its interested parties or
affiliates
Russian law requires a joint stock company that enters into transactions with certain related persons that
are referred to as ‘‘interested party transactions’’ to comply with special approval procedures. Under
Russian law, an ‘‘interested party’’ means: (i) any member of the board of directors or the collegiate
executive body of the company, (ii) the chief executive officer of the company (including managing
organisation or hired manager), (iii) any person who, together with its affiliates, owns at least 20% of the
company’s voting shares or (iv) a person who has the legal right to give mandatory instructions to the
company, if such person, or a close relative or affiliate of such person, is:
•   a party to a transaction with the company, whether directly or as a representative or intermediary, or
    a beneficiary of the transaction;
•   the owner of at least 20% of the shares in a company that is a party to a transaction with the company,
    whether directly or as a representative or intermediary, or a beneficiary of the transaction;
•   a member of a governing body of a company that is a party to a transaction with the company,
    whether directly or as a representative or intermediary, or a beneficiary of the transaction or an
    officer of the managing organisation of such company; or
•   in other cases stipulated by law or the company’s charter.
Under applicable Russian law, interested party transactions must be approved by a majority of the
disinterested directors of the company or, where (i) all the directors are interested, (ii) the value of the
transaction is equal to or exceeds 2% of the company’s assets as determined under RAR according to its
latest balance sheet, or (iii) in case of certain share placements, by a majority vote of the disinterested
shareholders. Failure to obtain the appropriate approval for a transaction may result in it being declared
invalid upon a claim by the company or any of its shareholders.

Risks Relating to the Notes and the Trading Market

Payments under any Series of Notes are limited to the amount of certain payments received under the relevant
Loan Agreement
The Issuer is only obliged to make payments under a Series of Notes to the Noteholders in an amount
equal to, and in the same currency as, sums of principal, interest and additional amounts (if any) actually
received by or for the account of the Issuer from Sberbank pursuant to the relevant Loan Agreement.
Consequently, if Sberbank fails to meet its payment obligations under the relevant Loan Agreement in
full, this will result in the Noteholders of a Series of Notes receiving less than the scheduled amount of
principal, interest and additional amounts (if any) on the relevant due date.

No direct recourse of the Noteholders to Sberbank
Except as otherwise expressly provided in the ‘‘Terms and Conditions of the Notes’’ and in the Trust
Deed, the Noteholders will not have any proprietary or other direct interest in the Issuer’s rights under
or in respect of the relevant Loan Agreement. Subject to the terms of the Trust Deed, no Noteholder will
have any entitlement to enforce any of the provisions of the relevant Loan Agreement or have direct
recourse to Sberbank except through action by the Trustee under the Charge (as defined in the ‘‘Terms
and Conditions of the Notes’’) or assignment of rights.

                                                    25
In addition, Noteholders should be aware that neither the Issuer nor the Trustee accepts any responsibility
for the performance by Sberbank of its obligations under the relevant Loan Agreement. See ‘‘Terms and
Conditions of the Notes—1. Status.’’

No existing market/market volatility
There is no existing market for the Notes. Application has been made for the Notes to be listed on the
Official List and admitted to trading on the London Stock Exchange’s market for listed securities.
However, there can be no assurance that an active trading market for the Notes will develop or, if one
does develop, that it will be maintained. If an active trading market for the Notes does not develop or is
not maintained, the market price and liquidity of the Notes may be adversely affected.
The market for securities issued by Russian issuers is influenced by economic and market conditions in
other emerging markets. Although the Russian market has stabilised somewhat since the devaluation of
the rouble in August 1998, there can be no assurance that events in Russia or other emerging markets will
not cause a recurrence of such market volatility or that such volatility will not adversely affect the price
of the Notes. The volatility in the Russian securities market is still very high.

Withholding tax may be applied to Sberbank’s payments under any Loan
In general, interest payments on borrowed funds made by a Russian entity to a non-resident legal person
are subject to Russian withholding tax at the rate of 20%, unless the withholding tax is reduced or
eliminated pursuant to the terms of an applicable double tax treaty. Based on professional advice
Sberbank has received, it currently believes that interest payments on each Loan should not be subject to
withholding under the terms of the double tax treaty between Russia and Luxembourg. However, there
can be no assurance that such an exemption will continue to be available.
Subject as provided in the Trust Deed, the Issuer will charge, by way of first fixed charge, as security for
its payment obligations certain of its rights and interests under the relevant Loan Agreement and the
relevant Account (as defined in the relevant Loan Supplement or Subordinated Loan Agreement, as the
case may be,) but excluding any Reserved Rights (as defined in the ‘‘Terms and Conditions of the Notes’’)
and assign, in favour of the Trustee, certain of its other rights under the relevant Loan Agreement, but
excluding any Reserved Rights (as defined in the ‘‘Terms and Conditions of the Notes’’), in each case for
the benefit of the relevant Noteholder. See ‘‘—Overview of the Programme’’. Rights under security
granted to the Trustee in the Trust Deed will become exercisable upon the occurrence of a Relevant
Event. In circumstances where payments under any Loan Agreement become payable to the Trustee
pursuant to the security arrangements described herein, benefits of the Russia-Luxembourg double tax
treaty will cease, and payments under such Loan Agreement to the Trustee may be required to be made
subject to Russian income tax withholding at a rate of 20%, or such other rate as may be in force at the
time of payment.
If the interest payments under any Loan are subject to any withholding or deduction of Russian or
Luxembourg tax (as a result of which the Issuer would reduce payments under the corresponding Series
of Notes in the amount of such withholding), Sberbank will be obliged under the terms of the relevant
Loan Agreement to increase interest payments (pay additional amounts) as may be necessary so that the
net payments received by the Noteholders will not be less than the amounts they would have received in
the absence of such withholding or deduction. It is currently unclear whether the provisions obliging
Sberbank to gross-up interest payments will be enforceable under Russian law. There is a risk that
gross-up for withholding tax will not take place and that interest payments made by Sberbank under the
relevant Loan Agreement will be reduced by Russian income tax withheld by Sberbank at the rate of 20%,
or such other rate as may be in force at the time of payment. See ‘‘Taxation.’’
Payments in respect of any Series of Notes will be made, except in certain limited circumstances, without
a deduction or withholding for or on account of Luxembourg taxes. However, pursuant to recent
developments in European tax law, interest on the Notes paid to individuals resident in European Union
member states has become subject to withholding tax. For further information on this legislation and the
applicability of withholding tax to interest payments, see ‘‘Taxation—Luxembourg.’’ If any payments in
respect of the Notes become subject to deduction or withholding for or on account of Luxembourg taxes
(other than pursuant to the recent development in European tax law set forth above), Sberbank will,
subject to certain limitations, be obliged under the terms of the relevant Loan Agreement to increase
interest payments (pay additional amounts) as may be necessary so that the net payments received by the
Noteholders will not be less than the amounts they would have received in the absence of such

                                                    26
withholding. For further information regarding the circumstances in which the payment of such additional
amounts will be required and the limitations thereon, see ‘‘Terms and Conditions of the Notes—
8. Taxation.’’
If Sberbank is obliged to increase payments (pay additional amounts), it may (without premium or
penalty), subject to certain conditions, prepay such Loan in full. In such case, all outstanding Notes of the
corresponding Series would be redeemable at par together with accrued and unpaid interest and
additional amounts, if any, to the date of the redemption. See ‘‘Terms and Conditions of the
Notes—6. Redemption and Purchase.’’

Withholding of tax on dispositions of the Notes in Russia may reduce their value
If a non-resident Noteholder that is a legal entity or organisation sells any Notes and receives proceeds
from a source within Russia, there is a risk that the part of the payment, if any, representing accrued
interest may be liable for 20% Russian withholding tax, although such tax may be reduced or eliminated
under an applicable tax treaty. Where proceeds from a disposition of the Notes are received from a source
within Russia by an individual non-resident holder, a similar withholding tax would be charged at a rate
of 30% on gross proceeds from such disposal of the Notes less any available cost deductions. The
imposition or possibility of imposition of this withholding tax could adversely affect the value of the
Notes. See ‘‘Taxation.’’

Subordination of payment obligations under Subordinated Loans
Sberbank’s obligations in respect of the payment of principal and interest under any Subordinated Loan
are subordinated in right of payment to the claims of its unsubordinated creditors. As a result, in case of
the entry into force of a final decision of a competent Russian court finding Sberbank bankrupt (a
‘‘Bankruptcy Event’’), Sberbank’s assets will be available to satisfy obligations in respect of Subordinated
Loans only after the claims of all unsubordinated creditors have been satisfied in full. Such remaining
assets may not be sufficient to satisfy Sberbank’s obligations, in whole or in part, under any outstanding
Subordinated Loans. See ‘‘The Banking Sector and Banking Regulation in Russia—Insolvency of Credit
Organisations—Priority of Claims.’’
The Subordinated Loan Agreements will not prohibit or limit the incurrence by Sberbank of
unsubordinated indebtedness, other subordinated indebtedness that will rank equally with the indebtedness
under any Subordinated Loans or other liabilities. Incurrence of such additional indebtedness or other
liabilities could adversely affect Sberbank’s ability to make payments under any Subordinated Loans. As
of December 31, 2005, Sberbank had RUR62.1 billion of senior long-term debt (in addition to
indebtedness incurred in the ordinary course of its banking business, such as deposits). Sberbank
anticipates that, from time to time, it will incur additional indebtedness, including unsubordinated
indebtedness.
In addition, in order for any Subordinated Loan to qualify as Tier 2 Capital under the CBR regulations,
the terms of each Subordinated Loan Agreement cannot and will not likely contain early repayment
provisions (with certain limited exceptions). Nonetheless, following the occurrence of a Bankruptcy
Event, amounts payable under each Subordinated Loan Agreement may be declared immediately due
and payable. However, such actions may not result in the payment of principal, accrued interest and
additional amounts, if any, due under any Subordinated Loan Agreement being paid in full, as such
payments may be made only after all unsubordinated obligations are satisfied in full.

Redemption of Subordinated Loans prior to scheduled maturity
With respect to regulatory capital for banks and subordinated loans in particular, the concept of
subordinated debt is relatively new in Russia, and the rules governing subordinated debt may be subject
to further review, clarification and development. In particular, the regulatory capital regulations of the
CBR are currently rudimentary as compared with regulatory capital legislation enacted in other
jurisdictions, which could lead to uncertainty and a lack of clarity in the interpretation and application of
such regulations. Furthermore, the CBR regulations do not currently address certain important concepts
such as call options, step-up coupons and other issues relating to subordinated debt, which are generally
accepted as standard in the world’s more developed financial markets and which will be contained in the
Subordinated Loan Agreement. Sberbank understands that the CBR and the government are currently
in the process of improving the Russian bank regulatory capital framework in order to harmonise it with
international norms.

                                                     27
Under the current bank capital regulations, any Subordinated Loan Agreement will be subject to review
and approval by the CBR, in order for the CBR to grant its final approval on the regulatory capital
treatment of a Subordinated Loan. There can be no assurance that any Subordinated Loan will be given
regulatory capital treatment by the CBR. If a Subordinated Loan is not given regulatory capital
treatment, it may be redeemed by Sberbank, resulting in the redemption of the corresponding Series of
Notes.

Consent of the CBR may be required for redemption of Subordinated Loans
Certain provisions of any Subordinated Loan Agreement may provide for prepayment of Subordinated
Loans which may be subject to the consent of the CBR. There can be no guarantee that the consent of
the CBR will be forthcoming even if any Subordinated Loans would otherwise be subject to prepayment
pursuant to such provisions and, consequently, that Sberbank will be able to prepay such loans at the
relevant time.

Definitive Notes will be available only in certain denominations
The minimum denomination of Notes issued under the Programme will be u50,000 (or its equivalent in
other currencies at the date of issue). However, for so long as any Series of Notes is represented by one
or more Global Notes, and Euroclear and Clearstream, Luxembourg so permit, the Notes shall be
tradeable in minimum nominal amounts of u50,000 (or its equivalent in other currencies) and integral
multiples of u1,000 (or its equivalent in other currencies) thereafter. In the event that any Global Note
is exchanged for definitive Notes, such definitive Notes shall be printed and issued in denominations of
u50,000 only (or its equivalent in other currencies at the date such Global Note is exchanged for definitive
notes). Accordingly, if definitive notes are required to be issued, Noteholders who hold Notes in
Euroclear or Clearstream, Luxembourg in amounts that are not integral multiples of u50,000 (or its
equivalent in other currencies) may need to purchase or sell, on or before the relevant Exchange Date (as
defined in ‘‘Summary of the Provisions Relating to the Notes in Global Form—Exchange for Definitive
Notes—Exchange’’), a principal amount of Notes such that their holding is an integral multiple of u50,000
(or its equivalent in other currencies).

Other Risks

No independent verification of information regarding Sberbank’s competitors and official data from Russian
government agencies and the CBR
Sberbank and the Issuer have derived substantially all of the information contained in this document
concerning Sberbank’s competitors from publicly available information, and they have relied on the
accuracy of this information without independent verification.
In addition, some of the information contained in this Base Prospectus has been derived from the official
data of Russian government agencies and the CBR. The official data published by Russian federal,
regional and local governments are substantially less complete or researched than those of Western
countries. The veracity of some official data released by the Russian government may be questionable. In
the summer of 1998, the Director of the Russian State Committee on Statistics and a number of his
subordinates were arrested and charged with manipulating economic data to hide the actual output of
various companies. Official statistics, including those produced by the CBR, may also be produced on
different bases than those used in Western countries. Any discussion of matters relating to Russia in this
Base Prospectus must, therefore, be subject to uncertainty due to concerns about the completeness or
reliability of available official and public information.




                                                    28
                                         USE OF PROCEEDS
The gross proceeds from each offering of a Series of Notes will be used by the Issuer for the sole purpose
of financing the corresponding Loan to Sberbank. The gross proceeds of such Loan will be used by
Sberbank for general corporate purposes (unless otherwise specified in the relevant Loan Agreement). In
connection with the receipt of such Loan, Sberbank will pay an arrangement fee, as reflected in the
relevant Final Terms.




                                                   29
                                                                   CAPITALISATION
The following table sets forth Sberbank’s capitalisation as of December 31, 2005. For further information
regarding Sberbank’s financial condition, see ‘‘Selected Financial Information,’’ ‘‘Financial Review’’ and
the IFRS Financial Statements included elsewhere in this Base Prospectus.

                                                                                                                                         As of
                                                                                                                                   December 31, 2005
                                                                                                                                   thousands of RUR
Senior long-term debt(1)
Other borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  62,075,953
                                            (2)
Total senior long-term debt                       ...........................................                                               62,075,953
Borrowing under subordinated loan agreement . . . . . . . . . . . . . . . . . . . . . . . . . . .                                           29,393,050
Total long-term debt(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   91,469,003
Share capital
19,000,000 ordinary shares with a par value of RUR50 each and 50,000,000
  preference shares with a par value of RUR1 each, all authorised, issued,
  paid up and outstanding as of December 31, 2005 . . . . . . . . . . . . . . . . . . . . . . .                                            20,980,583
Share premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                10,016,190
Treasury shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    (301)
Revaluation reserve for premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           15,873,431
Retained earnings and other reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                              184,198,613
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          231,068,516
Total capitalisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              322,537,519


(1)    Includes secure long-term financing (with remaining contractual maturity of over one year) incurred in the ordinary course of
       banking business.
(2)    Sberbank’s senior long-term debt (with remaining contractual maturity of over one year) does not include RUR654 billion of
       long-term deposits, interbank loans, promissory notes and certificates of deposit incurred or issued that are not considered part
       of Sberbank’s capitalisation.
(3)    None of this debt is secured or guaranteed by third parties.
There have been no material changes in the capitalisation of Sberbank since December 31, 2005.




                                                                                  30
                                                SELECTED FINANCIAL INFORMATION
Sberbank’s selected financial information presented below has been prepared in accordance with IFRS
and derived from Sberbank’s audited IFRS Financial Statements. The selected financial information
presented below has been derived from the IFRS Financial Statements included elsewhere in the Base
Prospectus and should be read in conjunction with such IFRS Financial Statements and with ‘‘Financial
Review.’’
Certain new IFRSs became effective for Sberbank from January 1, 2005. All such changes in accounting
policies were applied retrospectively. The nature of the adjustments made due to application of new
IFRSs and its effect to corresponding information for the year ended December 31, 2004 is disclosed in
Note 5 to the IFRS Financial Statements.

                                                                                                                     For the years ended December 31,
                                                                                                                         2005                 2004
                                                                                                                                           (restated)
                                                                                                                             thousands of RUR
Selected Income Statement Data
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            245,521,854         166,734,284
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             (89,148,954)        (84,930,051)

Net interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                156,372,900          81,804,233
Provision for loan impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        (19,601,682)        (15,790,772)

Net interest income after provision for loan impairment . . . . . . . . . .                                            136,771,218          66,013,461
Gains less losses arising from trading securities and other securities
  at fair value through profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . .                             16,144,622          13,862,219
Gains less losses arising from investment securities available for
  sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           4,709            2,830,446
Gains arising from investment securities held to maturity . . . . . . . . .                                              4,180,969                   —
(Losses net of gains)/gains less losses from trading in foreign
  currencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              (730,563)          5,017,305
Foreign exchange translation gains less losses . . . . . . . . . . . . . . . . . . .                                     5,920,153          (1,598,441)
Fee and commission income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           36,929,702          26,198,106
Fee and commission expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          (1,146,784)           (741,559)
Other operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       3,920,700           2,093,217

Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              201,994,726         113,674,754
Administrative and other operating expenses . . . . . . . . . . . . . . . . . . . .                                   (114,373,230)        (90,587,654)

Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              87,621,496          23,087,100
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 (21,813,964)         (4,919,463)

Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                65,807,532          18,167,637

Earnings per ordinary share, basic and diluted
(expressed in RUR per share) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                3,454                 949




                                                                                    31
                                                                                                                           As of December 31,
                                                                                                                          2005              2004
                                                                                                                                         (restated)
                                                                                                                            thousands of RUR
Selected Balance Sheet Data
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123,368,671 109,136,991
Mandatory cash balances with the Central Bank of the Russian Federation                                                           56,808,779    44,966,603
Trading securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131,815,427 117,036,694
Other securities at fair value through profit or loss . . . . . . . . . . . . . . . . . . . . . . 227,280,891 215,569,169
Due from other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                25,932,229    10,576,697
Loans and advances to customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,787,288,224 1,298,006,237
Investment securities held to maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          28,398,916    35,650,135
Premises and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106,849,836                    72,381,032
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      23,725,839    12,683,018
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,513,127,517 1,922,219,956
Due to other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             24,912,260    12,949,575
Deposits from individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,514,301,804 1,199,916,878
Customer accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 546,805,963 454,384,812
Debt securities in issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             86,889,528    63,313,212
Other borrowed funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               62,963,865    29,763,322
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      14,462,112     8,573,573
Subordinated debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          29,393,050            —
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,282,059,001 1,768,901,372
Share capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    20,980,583  20,980,583
Share premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        10,016,190  10,016,190
Treasury shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            (301)       (312)
Revaluation reserve for premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                     15,873,431     453,397
Fair value reserve for investment securities available for sale . . . . . . . . . . . . .                                              —        4,655
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184,198,613 121,864,071
Total equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231,068,516 153,318,584
Total liabilities and equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,513,127,517 1,922,219,956
                                                                                                                                  As of and
                                                                                                                             for the year ended
                                                                                                                                December 31,
                                                                                                                           2005             2004
                                                                                                                                         (restated)
Selected Financial Ratios
Profitability
Return on shareholders’ equity(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               34.2%                12.4%
Return on total assets(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        3.0%                 1.1%
Liquidity
Net loans/total assets(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     71.1%                67.5%
Net loans/client accounts(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          86.7%                78.5%
Capital Adequacy
Tier 1 capital ratio (BIS)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         10.3%                10.1%
Total capital adequacy(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         12.5%                10.1%
Total equity/total assets(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         9.2%                 8.0%

(1)    Profit for the year divided by average total equity, calculated as a simple average of Sberbank’s total equity as of January 1
       and December 31 of the relevant year.
(2)    Profit for the year divided by average total assets, calculated as a simple average of Sberbank’s assets as of January 1 and
       December 31 of the relevant year.
(3)    Loans and advances to customers (net of provision for loan impairment) divided by total assets, calculated as of December 31
       of the relevant year.
(4)    Loans and advances to customers (net of provision for loan impairment) divided by a sum of deposits from individuals and
       customer accounts, calculated as of December 31 of the relevant year.
(5)    Tier 1 capital calculated in accordance with the Bank for International Settlements (‘‘BIS’’) methodology as of December 31
       of the relevant year.
(6)    Tier 1 and Tier 2 capital calculated in accordance with the BIS methodology.
(7)    Total equity divided by total assets, calculated as of December 31 of the relevant year.




                                                                              32
                                               BUSINESS
Overview
Sberbank is the largest commercial bank in Russia. According to The Banker magazine, a leading banking
industry publication, Sberbank is also the largest bank in Central and Eastern Europe (including Russia)
in terms of Tier 1 capital and assets. Sberbank plays a significant role in Russia’s financial system and
economy. It is the largest lender in Russia and the largest taker of deposits. Sberbank believes that as of
January 1, 2006, under RAR, its assets accounted for 26.5% of all Russian banking sector assets.
According to Sberbank’s calculations as of January 1, 2006, it had, in Russia, a 58.5% market share in
rouble retail deposits, a 40.8% market share in hard currency retail deposits, a 44.1% market share in loans
to individuals, a 32.0% market share in rouble and a 32.6% market share in foreign currency loans to legal
entities, a 16.7% market share in account balances of legal entities and a 16.6% share in the government
securities trading market, all as calculated in terms of value and under RAR. According to Expert
magazine, a leading Russian business weekly, as of January 1, 2006, Sberbank’s assets, as calculated under
RAR, exceeded the combined assets of the next ten largest Russian banks. For further information about
Sberbank’s share of the Russian banking market, see ‘‘—Market Position and Competitive Strengths.’’
Sberbank’s principal activities include deposit taking, payment, account and settlement services, lending,
trading and investing in securities on its own and clients’ behalf, conducting foreign exchange and foreign
trade transactions, cash handling services, operations with precious metals and coins, depositary services
and other ancillary services for retail and corporate clients.
Sberbank has prepared IFRS financial statements since 1996. For the year ended December 31, 2005, it
generated operating profit of RUR202.0 billion and had a profit of RUR65.8 billion. Of Sberbank’s
operating profit in 2005, net interest income accounted for 77.4%, or RUR156.4 billion, net fee and
commission income accounted for 17.7%, or RUR35.8 billion and gains less losses arising from trading
securities and other securities at fair value through profit or loss accounted for 8.0%, or RUR16.1 billion.
For a comparison with corresponding results for the year ended December 31, 2004, see ‘‘Financial
Review.’’ As of December 31, 2005, Sberbank’s total assets were RUR2,513.1 billion and its return on
equity (calculated as profit for the year divided by average total equity) was 34.2%.
Under Russian banking legislation and Sberbank’s charter, the CBR must hold a controlling stake (at least
50% plus one voting share) in Sberbank. As of December 31, 2005, the CBR owned 63.76% of Sberbank’s
ordinary shares and 60.57% of its total share capital (which consists of ordinary and preference shares)
and is thus its controlling shareholder. The representatives of the CBR hold seven, the representatives of
the Russian government hold three, and a representative of the Russian President holds one, of the 16
seats on Sberbank’s Supervisory Board. Two other seats are held by representatives of Sberbank and three
by independent members that are not affiliated with the CBR, the Russian government or Sberbank. The
Chairman of the CBR serves as Chairman and the two First Deputy Chairmen of the CBR serve as
Deputy Chairmen of Sberbank’s Supervisory Board.
Sberbank’s shares have been publicly traded in Russia since 1996. As of December 31, 2005, foreign
investors owned 18% of Sberbank’s shares (including in the form of unsponsored depositary shares). As
of the same date, institutional and private investors (including foreign investors) owned 38.1% of
Sberbank’s shares.
As of March 1, 2006, Sberbank conducts its banking business through its 17 Regional Head Offices, 972
branches and 19,298 sub-branches and outlets. Sberbank’s Central Head Office is located at 19 Vavilova
Street, 117997 Moscow, Russian Federation. The telephone number of the Central Head Office is
+7 495 974-6677. See ‘‘—Business Strategy—Internal Development—Branch Network.’’
Sberbank is a member of the World Savings Bank Institute, of which its Chairman and Chief Executive
Officer, Andrei I. Kazmin, is a vice-president, the European Savings Banks Group and the U.S.-Russia
Business Council. It is also a member of a number of international financial organisations, including the
International Banking Security Association, the International Securities Market Association, the
International Chamber of Commerce and SWIFT. In addition, Sberbank is a member of the major
organisations that form the infrastructure of the Russian financial markets, including the Association of
Russian Banks (of which Sberbank’s Chairman and Chief Executive Officer, Andrei I. Kazmin, is a
vice-president), the MICEX, the National Depositary Centre, the National Currency Association, the
Association of Participants in the Bills of Exchange Market and the National Fund Association.
Sberbank’s Chairman and Chief Executive Officer, Andrei I. Kazmin, is also a member of the board of
directors of MasterCard Europe.

                                                    33
Sberbank has a long-term issuer default rating of ‘‘BBB’’ from Fitch and a foreign currency deposit rating
of ‘‘Baa2/Prime-2’’ and a financial strength rating of ‘‘D-’’ from Moody’s.

History and Development
Sberbank’s business dates back to 1841, when a decree by Tsar Nicolas I established the first Russian
savings banks. It has existed in various forms thereafter. Savings Bank of the Russian Federation, known
as Sberbank, was established on March 22, 1991. Sberbank’s charter was registered by the CBR on
June 20, 1991 and has been in force since then with subsequent amendments. Its current charter was
approved by the CBR on September 13, 2005.
Sberbank is registered in the Unified State Register of Legal Entities under number 1027700132195.
Sberbank currently holds a general banking licence (number 1481), which was re-issued by the CBR on
October 3, 2002. Sberbank also holds licences required to trade and hold securities and to provide other
services relating to securities. Sberbank is primarily regulated and supervised by the CBR.
Since its formation in 1991, Sberbank transformed itself from a state savings institution into the largest
Russian universal commercial bank. See ‘‘—Overview.’’ In the 1990s, Sberbank diversified its asset and
funding base by attracting business from legal entities while expanding and developing its retail banking
business. By the late 1990s, it achieved leading positions in a number of sectors of the developing Russian
financial market, such as retail and corporate lending, operations in securities, deposit taking, clearing
services and operations with precious metals. Sberbank also restructured its management and planning
systems, developing centralised interest rate, financial control and risk, liquidity and cash flow management
policies.
During the Russian banking and economic crisis of 1998, Sberbank demonstrated its ability to remain
stable, and as a consequence reinforced its position as the leading Russian bank and attracted new clients.
Despite a sizeable volume of its retail deposits being withdrawn and many of its large corporate clients
having financial problems, Sberbank fulfilled all of its obligations, including the timely repayment in
December 1998 of a syndicated loan extended by foreign banks in the amount of U.S.$225 million.
Sberbank also met all its other obligations to foreign counterparties.
In 2000, Sberbank underwent a large-scale reorganisation of its organisational structure. It closed certain
less profitable branches, sub-branches and outlets, reducing the number of its business units by 20%.
Sberbank also consolidated its regional office and management structure and created the 17 Regional
Head Offices that function as head offices for their respective regions. Creating the Regional Head Offices
allowed Sberbank to streamline its banking network management, decrease its operating costs, increase
the potential of regional business units, implement new technologies and perfect its proprietary settlement
system. The optimisation of Sberbank’s banking network is continuing today, with the aim of creating an
optimal management structure and increasing business efficiency. See ‘‘—Branch Network.’’

Business Strategy
Sberbank is a universal commercial bank and its strategic objective is to achieve a new level of quality in
client service in order to strengthen its leading position in the Russian banking market. Achieving this
strategic objective will enable Sberbank to retain its position as a modern, first-class bank and the largest
bank in Central and Eastern Europe (including Russia). See ‘‘—Overview.’’
Sberbank’s management has identified the initiatives described below as essential to meeting its strategic
objective.

Retail Market
Sberbank is the leader in the Russian retail banking market, and its retail clients are the primary and the
most stable source of its funding. Sberbank intends to maintain its leading role in the retail market by
increasing the number and improving the quality of products and services offered to retail clients.
Sberbank is targeting as potential clients people of all ages, backgrounds and income levels: workers and
pensioners, the young and the middle-aged and low, medium and high-income individuals.
Improvement in the quality of its retail banking services is also a priority for Sberbank, especially in light
of the increasing competition in the retail banking sector and the rising consumer demand for banking
products and technologies.


                                                     34
Some of the initiatives upon which Sberbank has embarked in the retail banking market include the
following:
•   Focusing on cross-selling opportunities to existing retail customers. Sberbank expects that this will
    increase sales of fee-based services and deposit products and will result in an overall increase in the
    use of banking services by retail customers;
•   Increasing significantly the sales of existing retail credit products, such as consumer and mortgage
    loans, in order to capitalise on the growth of personal incomes and purchasing power of Russian
    consumers;
•   Taking advantage of its proprietary payment and settlement system that enables the use of bank
    cards throughout Russia and expanding the infrastructure for the use of bank cards and real-time
    account information management, in order to take advantage of a substantial increase in the demand
    for technologically-enhanced retail banking products; and
•   Increasing the marketing of private banking services as well as investment products offered by
    non-state pension funds, mutual funds, other financial institutions and insurance companies,
    particularly outside Moscow.
Sberbank believes that these retail market initiatives will strengthen long-term client relationships, ensure
the necessary increase in its funding base, promote risk diversification and increase fee-based revenues.

Banking Services to Corporate Clients
Sberbank is expanding its presence in the corporate banking market by leveraging its competitive
advantages and developing long-term working relationships with its corporate clients. In this market
segment, Sberbank is targeting large clients, medium-sized business clients and small businesses. For a
description of what constitutes large clients, medium-sized business clients and small businesses,
see ‘‘—Banking Services and Activities—Corporate and Public Sector Services—Client Segmentation.’’
Sberbank has set the following primary goals relating to servicing such clients:
•   Developing long-term relationships with large clients and maintaining and increasing the range of
    products offered to, and the volume of operations conducted with, such clients, as well as attracting
    new large clients from among the largest Russian enterprises operating in various industries and
    regions;
•   Significantly increasing the number of medium-sized business clients and the volume of banking
    products and services provided to such clients. Sberbank plans to create a range of banking products
    suitable for such clients’ needs, including products tailored to the needs of particular medium-sized
    business clients; and
•   Expanding the range and volume of services provided to small businesses. See ‘‘—Banking Services
    and Activities—Corporate and Public Sector Services—Services—Lending.’’

Banking Services to the Public Sector
The size and scale of Sberbank’s branch network and its long history as a service provider to the state
make it the provider of choice to state authorities and public enterprises. Sberbank intends to maintain
strong relationships with this client segment by:
•   Expanding its involvement in government economic development programmes on a nationwide,
    regional and industry sector basis; and
•   Offering the state and public enterprises improved capabilities of its branch network, further
    technological advances and new high-quality banking products.
Sberbank has a long history of providing certain services to state authorities and public enterprises
without charging fees for such services. However, Sberbank is negotiating with the Russian government,
as well as regional, local and municipal authorities a gradual shift of such services to a commercial basis.
These negotiations have already led to state authorities compensating a portion of expenses incurred by
Sberbank while acting as an agent for federal ministries and agencies.




                                                     35
Internal Development
In order to accomplish its strategic objectives in light of increased competition in the Russian banking
market, Sberbank intends to invest further in its:
•   Employees;
•   Information systems and technologies;
•   Branch network; and
•   Presence in the other CIS countries.
Employee Development
Sberbank considers employee development fundamental to its strategic objective. Some of Sberbank’s
current initiatives in this area include:
•   Cooperation agreements with the best Russian colleges and universities;
•   Establishment of scholarships for the most talented economics students;
•   Further developing in-house personnel re-training and certification systems; and
•   Regularly sending its most promising employees for training with the world’s largest banks and for
    advanced studies.
Sberbank believes that these initiatives will allow it to hire the best graduates, to ensure the continuous
improvement of the skills of its employees and to develop an effective source of future senior
management. Sberbank plans to continue achieving the highest level of professional conduct and
motivation of its employees, which it considers instrumental to achieving its strategic objective, through
financial and non-financial incentives.
Information Systems and Technologies
Sberbank’s ability to execute its strategic plan relies on innovative technological solutions that drive the
automation of banking processes. Sberbank intends to concentrate on the development and enhancement
of its automated management systems, which will allow it to reduce costs relating to internal controls,
anti-money laundering procedures, asset, liability and risk management, accounting, financial reporting,
and treasury operations. Sberbank’s comprehensive programme for the automation of banking operations
has been examined by an international consulting firm, which confirmed that the proposed technological
solutions comply with leading international banking standards.
Sberbank plans to offer its clients a unified approach to banking products throughout Russia, offering the
latest banking products and services to clients living in the central as well as more remote regions.
Sberbank plans to further improve access of the Russian population to banking products and services not
only through its branch network but also through various selling systems, including ATMs, self-service
zones, ‘‘Client-Sberbank’’ remote communication system, the Internet, mobile phones and call centres.
Branch Network
Sberbank’s branch network is a key long-term competitive advantage and is instrumental to the
availability of banking products and services throughout Russia. Sberbank is improving the accessibility,
effectiveness and quality of its client services through modification of its branch network. A key part of
this process is the automation of Sberbank’s sub-branches and outlets, including the creation of
self-service zones within branches that would streamline clients’ access to common banking services, such
as deposits and payments. Sberbank believes that such automation will make its personnel more available
to serve clients with respect to more complex banking products, such as loans.
CIS Presence
In light of increasing international economic integration and the international expansion of large Russian
companies. Sberbank believes that currently there are substantial business opportunities throughout the
CIS and that it will benefit from having a presence in the CIS countries where its Russian clients are
active. In light of this, Sberbank is considering acquiring banks in Ukraine and in Kazakhstan.
Market Position and Competitive Strengths
According to the CBR, as of March 1, 2006, 1,244 banks and non-bank credit organisations were operating
in Russia. The largest Russian banks are concentrated in Moscow, and large regional banks conduct most

                                                    36
of their business in the central cities of their home regions. Although some Moscow-based banks have
been expanding in the regions, outside Moscow and regional centres Sberbank is often the only local
provider of banking services, particularly retail banking services.
The range of products and services offered by Russian banks to their clients is expanding. However, few
banks provide comprehensive packages of products and services tailored to the needs of different retail
and corporate client groups.
According to Sberbank’s calculations, as determined by value and calculated under RAR, as of
January 1, 2006, it was the largest deposit taker in Russia, with a market share ranging from 40.3% in
Western Siberia to 81.7% in the Altay region, and was also the largest retail lender in Russia, with a
market share of 44.1%. As of that date, according to its calculations, Sberbank provided 47.3% of all
rouble loans made to individuals in Russia, as well as 32.0% of all rouble loans and 32.6% of all foreign
currency loans made to legal entities in Russia. Its market share of loans to legal entities ranged from
19.9% in the North-West of Russia to 50.7% in the Western Urals region. For further information about
Sberbank’s share of the Russian banking market, see the first paragraph under ‘‘—Overview.’’ Sberbank’s
retail customer base is the largest in Russia, and individuals come into contact with its business units and
services on a regular basis. One in seven employed individuals receives his or her salary and one in four
pensioners receives his or her pension through Sberbank. More than half of all payments made by
individuals in Russia, as measured by value of transactions, are made through Sberbank.
Sberbank believes that it is well-positioned to capitalise on the opportunities in the Russian banking
market in general and in the corporate banking market in particular because of a number of competitive
advantages, including reputation, brand recognition, a large, stable and well-diversified funding base, a
national banking network, independence and experienced management.
•   Reputation. Sberbank has a reputation as a stable and reliable bank. It was one of the few Russian
    banks that met in full its obligations to clients and other creditors during Russia’s 1998 financial crisis.
    In addition, Sberbank took over and fulfilled obligations to depositors of a number of bankrupt
    commercial banks. Sberbank also has a reputation as a reliable borrower among foreign banks.
    During the 1998 financial crisis, it repaid, on a timely basis, a U.S.$225 million syndicated loan facility
    and met all other obligations to foreign counterparties. See ‘‘The Banking Sector and Banking
    Regulation in Russia—Brief History of the Russian Banking Sector.’’ Sberbank is currently meeting
    all of its debt obligations on a timely basis.
•   Brand Recognition. Sberbank has long been present in the Russian banking market and, as of
    January 1, 2006, had 269.3 million retail bank accounts, an average of 1.9 accounts for every Russian,
    according to Sberbank’s calculations. Its longstanding and widespread market presence ensures that
    most Russians recognise the Sberbank brand.
•   Large, Stable and Well-Diversified Funding Base. Sberbank’s retail and corporate deposit business
    provides it with a stable and well-diversified funding base. As of February 1, 2006, Sberbank held
    RUR2.1 trillion in retail and corporate deposits. According to Expert magazine, as of January 1, 2006,
    its retail deposits were 17.2 times greater than those of its closest competitor in Russia. The size of
    its funding base enables Sberbank to provide larger and longer-term loans than most of its
    competitors, particularly to corporate clients.
•   National Banking Network. Sberbank has a well-developed branch network that engages in retail
    as well as corporate banking. Sberbank believes that its national banking network is more extensive
    than the combined networks of all other Russian banks. Sberbank has a substantial presence in all
    the Russian regions and is often the only local bank that can offer a full range of banking products
    and services. Its branches are connected through a proprietary settlement system that is second only
    to the CBR’s in terms of the volume of payments. In 2005, its settlement system processed over
    541.5 million transactions.
•   Independence. Sberbank is not controlled by or affiliated with any Russian financial-industrial
    group. As a result, Sberbank conducts its business in a commercially reasonable manner and enters
    into transactions with companies that compete with each other. In contrast, many other Russian
    banks are part of financial-industrial groups and continue to focus on serving those groups and acting
    in their interests. Sberbank believes that its clients value its independence. Sberbank’s majority
    shareholder, the CBR, has not asserted control over the day-to-day decision-making or operations of
    Sberbank.


                                                     37
•   Experienced Management. Sberbank’s senior management team, headed by its Chairman and Chief
    Executive Officer Andrei I. Kazmin, a former Deputy Minister of Finance of the Russian Federation,
    is familiar with, and has substantial experience in, all aspects of the banking business.
Sberbank’s main competitive advantages in the corporate banking market are:
•   Nationwide branch network. Sberbank’s products and services are accessible to corporate clients
    throughout Russia, which gives Sberbank a competitive edge in reaching corporate clients at the local
    level, where the presence of its competitors is relatively limited.
•   Economies of scale and scope. Sberbank’s size and market penetration allow it to reduce the costs
    of its services and to offer them to more clients.
•   Sberbank’s proprietary settlement system. The ability to provide real-time settlement of transactions
    between different regions is a unique competitive advantage for Sberbank, as it appeals to corporate
    clients that require speed and reliability, particularly in long-distance transaction processing.

Banking Services and Activities

Retail Services
Sberbank’s retail services focus on deposits and lending and also include transactions in securities and
other ancillary services.
Deposits. Sberbank is the leading Russian provider of retail bank deposit services and offers a variety
of interest-bearing bank accounts designed for different groups of retail clients, including high-income
earners, workers, pensioners and young people. As of January 1, 2006, Sberbank’s market share in retail
deposits in Russia, measured by volume, ranged from 40.3% in Western Siberia to 81.7% in the Altay
Region in central Russia. As of that date, Sberbank had 269.3 million retail bank accounts.
Sberbank’s deposit accounts include current and term accounts and are denominated in roubles, U.S.
dollars and euro. The terms of accounts vary from demand to five years and may be extended multiple
times. Term deposits, under Russian law, are effectively on demand. See ‘‘Risk Factors—Risks Relating
to Sberbank’s Business and Industry—Sberbank cannot completely eliminate liquidity risk.’’ Sberbank
constantly monitors the Russian country-wide and regional retail deposit markets and changes the range
of its deposit products and adjusts its interest rates to maintain its competitive position. The range of
Sberbank’s retail deposit is growing, allowing it to maintain and strengthen its leading market position and
to continue to increase its funding base.
Deposits from individuals constituted 73.5% of Sberbank’s deposit portfolio, or RUR1,514.3 billion, as of
December 31, 2005. The amount of Sberbank’s individual deposits increased by 26.2%, or RUR314.3 billion
in 2005. As of December 31, 2005, 81.7% of its deposits from individuals were in roubles and 18.3% in
foreign currencies.
Sberbank seeks to provide easy access to retail accounts. Retail clients can conduct their banking through
Sberbank’s branches and ATMs. Sberbank is continuing to expand its ATM network and, as of
January 1, 2006, had 6,982 ATMs. According to Sberbank’s calculations, as of January 1, 2006, its ATMs
accounted for 25% of all ATMs in Russia. Sberbank also offers retail clients the ability to manage their
accounts using their mobile phones. In some regions, Sberbank operates mobile cash units that
periodically visit rural areas, allowing residents to conduct their banking. Individuals may also obtain
cheques that entitle them to receive funds in any of Sberbank’s branches.
Sberbank has a leading position in the Russian bank card market. Sberbank’s bank cards for individuals
include Visa™ and MasterCard™ debit cards. Sberbank also issues Sbercart™ (‘‘Sbercart’’) a bank card
that can be used to make payments and obtain funds within Russia using advanced microchip technology.
Sberbank believes that the Sbercart technology will contribute to the creation of a national payment
system in Russia. As of January 1, 2006, Sberbank has issued 12.8 million bank cards. According to
Sberbank’s calculations, as of January 1, 2006, it had a 23.4% market share in the Russian bank card
market by volume of bank cards issued, a 32% share by value of bank card transactions with bank cards
issued in Russia and a 17% share in the market for bank card transaction processing.
Sberbank provides a number of ancillary services to its account holders. Individuals can have their salaries
deposited directly into their accounts with Sberbank. Sberbank serves as pension agent for a number of
government entities, and pensioners may arrange for their pensions to be deposited directly into their


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accounts with Sberbank. See ‘‘—Corporate and Public Sector Services—Services.’’ Individuals may also
make single or periodic rent, mortgage, utility and tax payments directly from their Sberbank accounts
that permit account operations. Sberbank provides rouble transfer services to individuals throughout
Russia and, through its correspondent bank network, throughout the CIS. It also provides foreign
currency transfer services to individuals to and from Russia through its international correspondent
banking network.
In January 2005, Sberbank was accepted for participation in the Russian retail deposit insurance scheme
established by the Deposit Insurance Law.
Lending. Sberbank is actively continuing to develop its retail loan portfolio. As of December 31, 2005,
retail loans, by amount, accounted for 24.9% of its gross loan portfolio, or RUR467.8 billion. Sberbank’s
retail loan portfolio grew by 76.0%, or RUR202.0 billion, in 2005. As of December 31, 2005, Sberbank had
more than 6.5 million retail borrowers. According to Sberbank calculations, as of December 31, 2005, it
had a 44.1% share in the Russian retail lending market.
Sberbank’s retail loans include consumer loans and real estate mortgages. As of December 31, 2005,
consumer loans accounted for 84.8% of Sberbank’s retail loan portfolio, and mortgages accounted for the
remaining 15.2%. Individuals usually obtain consumer loans to purchase consumer goods or cars, or to
finance travel, education or medical care. Mortgages are not yet common in Russia, in part because the
legal and supporting infrastructure for mortgages is not well-developed, and the demand for mortgages,
although growing, is limited. Consumer loans and mortgages are generally secured and/or guaranteed. See
‘‘—Asset, Liability and Risk Management—Lending Policies and Procedures—Individuals.’’
Individuals applying for loans must provide certain personal and financial information about themselves,
the requisite collateral and/or any guarantors as well as state the purpose of the financing. In order to
obtain mortgages or car loans, the borrowers must pay a portion of the relevant purchase price,
amounting to 10% of the amount of the mortgage and 15% of purchase price of the car. Some loans are
available only in roubles and others in roubles and foreign currencies, primarily U.S. dollars and euro.
Interest rates on retail loan products are set by Sberbank’s Board on the basis of the term of the loan, the
currency in which the loan is made and the security of the loan.
Transactions in Securities. Sberbank provides brokerage services for retail clients on all major Russian
stock exchanges. Retail clients may also invest in Sberbank’s proprietary bills of exchange and savings
certificates. Sberbank also assists retail clients with investments in mutual funds.
Other Retail Services. Sberbank buys, sells and exchanges all major foreign currencies for individuals. It
also sells American Express™ travellers checks and cashes Visa™, American Express™, Thomas Cook™
and Citicorp™ travellers checks. Individuals may buy or sell precious metals in physical or book-entry
form and coins made of precious metals through Sberbank, store precious metals and coins with Sberbank
and rent safe-deposit boxes to store valuables. Sberbank’s depositary services for individuals include,
among others, opening securities accounts, known as ‘‘depo’’ accounts, securities custody operations,
recording pledges of securities and coupon payments.
Corporate and Public Sector Services
Client Segmentation
Sberbank provides services to limited liability companies, joint-stock companies and companies partly or
wholly owned by state, regional or municipal authorities (together, ‘‘companies’’), as well as to federal,
regional and municipal authorities (‘‘state authorities’’ and, together with companies, ‘‘legal entities’’).
Sberbank’s internal corporate client categories include large clients, medium-sized business clients and
small business clients. Sberbank is also the principal banking and payment services provider to state
authorities.
Large clients are companies with annual revenues of over RUR1.5 billion. Large clients include the
largest Russian corporations and holding companies, which account for a significant portion of Russia’s
gross domestic product, including monopolies such as RAO Unified Energy Systems of Russia (‘‘UES’’)
and OJSC Gazprom (‘‘Gazprom’’), large enterprises in the oil industry such as OJSC TNK-BP
(‘‘TNK-BP’’), OJSC NK Rosneft (‘‘Rosneft’’), OJSC Tatneft, OJSC Transneft and other enterprises
operating in various sectors of the Russian economy, such as OJSC Aeroflot-Russian Airlines, OJSC Irkut
Scientific Production Corporation, OJSC Russian Railways, ALROSA Company Ltd., OJSC MMC
Norilsk Nickel, OJSC Wimm-Bill-Dann Foods and OJSC Rostelecom. In the fourth quarter of 2005,
Sberbank had 1,476 large clients, which accounted for approximately 0.2% of the total number of
Sberbank’s corporate clients.

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Large clients are a key part of Sberbank’s client base, as they are the source of the greatest transaction
volume, as well as of interest and fee-based income. In addition, cooperation with large clients enables
Sberbank to reduce its total cost of funding (since much of the funding is short-term or on-demand), to
extend large loans at lower risk and to sell significant volumes of fee-based products. In order to develop
long-term relationships with large corporate clients, Sberbank offers packages of banking products and
services tailored to their individual needs, such as combinations of construction and mortgage loans for
companies that build housing for their employees and special payment systems for companies that have
a large number of offices or branches. This practice enables Sberbank to increase business with its current
corporate clients and obtain new clients among Russia’s largest enterprises. Sberbank’s most popular large
client services include complex credit products, letters of credit, payment and settlement services using the
‘‘Client-Sberbank’’ remote communications system, overdraft loans and employee salary payment
arrangements.
Clients that do not fall into the ‘‘large’’ or ‘‘small business’’ (as described below) categories, are considered
medium-sized business clients. In the fourth quarter of 2005, Sberbank had approximately 25,000
medium-sized business clients, which accounted for approximately 2.8% of the total number of Sberbank’s
corporate clients). Medium-sized business clients use a wide range of Sberbank’s services, the most
popular of which are loans ranging from overdrafts to complex financing arrangements, payment and
settlement services, letters of credit, cash handling services, and salary payment arrangements.
Small business clients are small businesses, which are defined in Federal Law No. 88FZ ‘‘On State Support
of Small Business in the Russian Federation’’ as companies with 30 to 100 employees (depending on the
industry) that have limited participation of the state and companies that are not considered small
businesses, in their capital. In addition, Sberbank includes in this category companies, whose annual
revenues do not exceed RUR100 million. In the fourth quarter of 2005, Sberbank had more than 906,000
small business clients. Sberbank meets the needs of small business clients through a standard comprehensive
package of banking services, which includes loans and payment and settlement services. Successful small
businesses receive additional services tailored to their specific needs. Sberbank’s extensive branch
network enables its small business clients to choose the nearest and most convenient branch, sub-branch
or outlet. Providing services to small businesses is the most dynamic and profitable area of Sberbank’s
banking activities and where it believes it can make the most of its competitive advantages.
Sberbank is committed to increasing the range and the volume of its services to large, medium-sized and
small business clients and to developing long-term relationships with them. Sberbank strives to anticipate
the new directions in the banking business and the changes in the needs of its clients in order to quickly
implement and offer new banking products. See ‘‘—Business Strategy—Banking Services to Corporate
Clients’’ and ‘‘—Business Strategy—Banking Services to the Public Sector.’’
Services
Sberbank’s services to legal entities include payment and account and settlement services, lending,
transactions in securities, foreign trade and exchange transactions, cash handling services, services relating
to precious metals and coins and depositary services.
Payment, Account and Settlement Services. Sberbank provides payment services to and on behalf of legal
entities through its branches and its correspondent banking network. Companies operating nationwide
receive banking services throughout Sberbank’s branch network. Sberbank’s proprietary settlement
system services clients’ cash flows and allows settlement of transactions between Sberbank’s branches on
clients’ behalf in real time. Legal entities may conduct banking operations and obtain account information
through Sberbank’s proprietary ‘‘Client-Sberbank’’ remote communication system.
The amount held by legal entities (including public authorities) in accounts at Sberbank increased by
20.3% in 2005, to RUR546.8 billion. As of December 31, 2005, 70.7% of Sberbank’s deposits by legal
entities were in roubles and 29.3% in foreign currencies (primarily U.S. dollars and euro). Sberbank assists
legal entities with opening bank accounts and advises them on various banking operations and the use of
various banking products in their business. Sberbank provides legal entities with overdraft facilities, the
sizes of which are based on the volume of financial operations through the relevant accounts.
In the fourth quarter of 2005, Sberbank provided cash handling services to approximately 36,400 legal
entities. As of January 1, 2006, it had more than 752 cash collection offices, many of which are open six
or seven days a week and in the evenings. As a result, the clients’ collected cash can quickly be transferred
into their accounts with Sberbank.
Sberbank’s plastic cards for legal entities include Visa™ and Master Card Business™. Legal entities may
also receive Sbercart™ bank cards that operate within Russia using advanced microchip technology.

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Sberbank has entered into 11,200 agreements for the issuance and servicing of corporate bank cards and
has issued 17,000 such cards. Sberbank also offers bank card payment processing services for merchants
and service providers. By the end of 2005, Sberbank has entered into approximately 21,500 agreements
for the provision of such services.
Sberbank is the leading bank used for payment of salaries into employee bank accounts. In 2005, 88,000
legal entities paid RUR678.3 billion in salaries through Sberbank. In addition, Sberbank collects
payments on behalf of the tax authorities and of both state and privately-owned housing and communal
service providers, utility and telecommunications companies and other state-owned companies offering
services to the public sector. In 2005, Sberbank collected RUR96 billion in individual tax payments and
RUR521.1 million in other payments from individuals.
Lending. As of December 31, 2005, loans to legal entities (excluding banks) amounted to
RUR1,412.5 billion or 75.1% of Sberbank’s gross loan portfolio. In structuring its portfolio of loans to
legal entities, Sberbank focuses on developing long-term relationships with large clients, increasing its
revenues from the sale of credit products to medium-sized business clients and increasing the lending
volume to small business clients.
Sberbank believes that its loans to companies (excluding banks) accounted, by value of transactions, for
32.2% of all loans to companies made by Russian banks as of December 31, 2005. Sberbank lends to large
companies as well as medium-sized and small businesses in all sectors of the Russian economy. As of
December 31, 2005, Sberbank’s ten largest corporate clients accounted for 16.6% of its gross loan
portfolio, compared to 21.6% as of December 31, 2004.
Sberbank offers companies a wide range of credit products, including bank guarantees. Its main types of
loans to companies are short-term loans for ongoing business needs (including overdrafts), contractual
loans, investment project loans and financing of construction projects.
Sberbank also offers loans tailored to the needs of specific categories of borrowers, taking into account
the industries in which the borrowers operate. Its credit decisions when considering loans to companies
are based on, among other things, the effectiveness of the company’s business and the income-generating
potential of the project financed. See ‘‘—Asset, Liability and Risk Management—Lending Policies and
Procedures—Legal Entities.’’ The terms of loans range from several days to ten years. Sberbank has a
common interest rate policy across its banking network, which takes into account regional market
specifics and characteristics of different groups of borrowers. Loans to companies are, in most cases,
secured and/or guaranteed, except as described below. See ‘‘—Asset, Liability and Risk Management—
Lending Policies and Procedures—Legal Entities.’’ Loans are available in roubles and in foreign
currencies (primarily U.S. dollars and euro). As of December 31, 2005, 71.7% of Sberbank’s loans to legal
entities were in roubles and 28.3% in foreign currencies (primarily U.S. dollars and euro).
Sberbank is a key lender to the largest Russian companies operating in the oil and gas, aerospace,
ship-building and precision machinery industries. It also provides significant volumes of financing to
state-owned arms producers and exporters and finances civilian and military projects for development,
production and operation of new technical equipment and infrastructure.
During 2005, Sberbank provided RUR175.1 billion in loans to finance investment projects of corporate
clients. It has also began financing new investment projects in various industry sectors, including
communications, aluminium production, oil production development, port construction for oil shipping
and purchase and leasing of planes. Sberbank also actively finances projects in the housing construction
industry, construction of multipurpose and office buildings.
Sberbank believes that small businesses lending has significant potential. It aims to provide access to
credit resources for all solvent small businesses through flexibility of the lending terms and expansion of
standardised credit products, taking into account specific needs of small business. In 2005, Sberbank lent
RUR703.0 billion and U.S.$183.0 million to small and medium-sized business clients. As of
December 31, 2005, loans to small and medium-sized business clients amounted to RUR204.6 billion, or
14.5% of Sberbank’s gross loans to legal entities (excluding banks).
Sberbank provides interbank loans to other banks, including the CBR, primarily in order to manage
liquidity. As of December 31, 2005, its gross interbank loan portfolio was RUR25.9 billion, representing
1.4% of Sberbank’s total gross loan portfolio.
Sberbank also provides loans to state authorities, primarily to fund regional and local development
programmes. These loans are made on market terms. See ‘‘—Asset, Liability and Risk Management—

                                                   41
Lending Policies and Procedures—Legal Entities.’’ During 2005, Sberbank lent a total of RUR17.7 billion
to state authorities. As of December 31, 2005, loans to state authorities amounted to RUR10.5 billion, or
0.6% of Sberbank’s gross loans to legal entities (excluding banks).
Services to the Public Sector. As of January 1, 2006, 11.4 million pensioners served by the Ministry of
Labour and Social Development of the Russian Federation received pension payments through
Sberbank, which represented 29.9% of the total population of such pensioners. Payments to these
pensioners amounted to RUR349.9 billion, representing 32.6% of the total amount of pensions paid in
Russia as of January 1, 2006. In addition, as of that date, Sberbank made pension payments to 1.88 million
pensioners of the Ministry of Defence of the Russian Federation and other defence organisations. These
payments amounted to RUR113.4 billion in 2005. Sberbank also services state support payments to
parents and payments of unemployment and other state benefits. As of January 1, 2006, approximately
7.5 million parents received a total of RUR15.5 billion in state support payments through Sberbank. As
of that date, approximately 1.7 million individuals received a total of RUR14.7 billion in unemployment
and other state benefits.
In 2005, Sberbank also carried out repayment of the internal state debt in the amount of approximately
RUR25.2 billion. In addition, Sberbank participates in the state housing certificates programme, and, in
2005, redeemed a total of RUR10.9 billion in state housing certificates. These services were provided
using state funds.
Transactions in Securities. Sberbank offers legal entities brokerage services on all the major Russian
stock exchanges and conducts transactions in government, municipal and various corporate securities, as
well as derivatives, on their behalf. Legal entities may also invest in Sberbank’s proprietary bills of
exchange and certificates of deposit. Sberbank also engages in arranging and underwriting securities
offerings, as well as market-making, depositary, payment agency and investment advisory services.
Foreign Trade and Exchange Transactions. Sberbank conducts a wide range of banking operations
related to clients’ foreign trade activities. It offers its clients letters of credit, stand-by and revolving letters
of credit, export and import financing, collection, bank guarantees and various ancillary services.
Sberbank assists clients with documenting and settling export and import transactions and provides
Russian currency control agency services and consulting services for such transactions. It also sells and
purchases foreign currency to and from legal entities and sells, exchanges and collects foreign currencies
for bank clients. The most popular foreign trade-related service provided by Sberbank is the provision of
trade financing to Russian importers and exporters, including pre- and post- export and import financing,
using credit lines from foreign banks.
Sberbank cooperates as a borrower and a guarantor with export credit agencies and foreign banks that
finance trade operations through export credit agencies. For example, Sberbank has entered into a
cooperation agreement with the Export-Import Bank of the United States (‘‘Eximbank USA’’), pursuant
to which Sberbank was given access to all the Eximbank USA programs designed for Russia, and into
agreements with Eximbank Hungary, the Israel Foreign Trade Risk Insurance Company Ltd., Export
Development Canada, the Norwegian export agency Eksportfinans ASA and the China Export and
Credit Insurance company. Currently, the volumes of credit lines opened by national export agencies to
Sberbank amount to approximately EUR1,350 million and approximately U.S.$224 million.
Precious Metals Operations. Sberbank purchases and sells precious metals in both physical and
book-entry form, opens precious metal accounts (in gold, silver, platinum and palladium) and provides
precious metal loans to clients. It also provides financing to gold mining companies and jewellery
manufacturers. In addition, Sberbank sells and purchases Russian and foreign coins made of precious
metals.
Depositary Services. Sberbank believes that it is one of the leading Russian providers of depositary
services. It offers a wide range of depositary services to legal entities with respect to all types of securities,
including, but not limited to, transfers and pledges of securities and opening of ‘‘depo’’ accounts.
Sberbank’s depositary has established correspondent relationships with 43 registrars in Russia and also a
number of leading depositaries.

Proprietary Activities
Sberbank engages in transactions in securities for its own account. It conducts significant trading and
investment operations with Russian government securities and is the largest operator in the Russian
government securities market. It acts as a market maker and engages in trading operations in government

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securities on all Russian stock exchanges, participates in government securities auctions conducted by the
CBR and in purchase and sale and repurchase (‘‘repo’’ and ‘‘reverse repo’’) transactions with the largest
Russian banks and with foreign banks. For the description of the composition of Sberbank’s securities
portfolio, see ‘‘Financial Review—Selected Statistical and Other Information—Securities Portfolio’’ and
Notes 8 and 9 to the IFRS Financial Statements.
Sberbank also conducts proprietary trading activities in corporate debt and equity securities and
municipal securities, primarily municipal bonds of the cities of Moscow and St. Petersburg. In addition,
it is a key market maker in the domestic rouble/U.S. dollar conversion market and engages in foreign
currency trading activities in the international markets. It also trades in foreign currency futures on
MICEX. In addition, Sberbank conducts proprietary transactions in derivatives.

Branch Network
As of March 1, 2006, Sberbank’s banking network consisted of 17 Regional Head Offices, 972 branches
and 19,298 sub-branches and outlets throughout Russia. In 2005, 22.6% of Sberbank’s branches provided
lending services, 44.2%, provided account and foreign currency services and 31.8% issued and serviced
bank cards. The Regional Head Offices coordinate the business of branches, sub-branches and outlets
located in their regions.
Sberbank is the only Russian bank with a presence throughout Russia: 17.7% of its branches, sub-branches
and outlets are located in the central cities of the Russian regions, 6.3% in cities with a population of over
100,000, 15.4% in smaller cities, 7.0% in villages and 53.6% in the countryside.
Sberbank’s development priority is the optimisation of its branch network in areas of current or potential
demand for banking products and services. This is achieved through opening branches, sub-branches or
outlets in areas of high socio-economic development and areas where Sberbank’s presence is lacking, as
well as through relocating branches, sub-branches and outlets in order to increase their profitability and
accessibility. For a description of Sberbank’s strategy for the development of its branch network, see
‘‘— Business Strategy—Internal Development—Branch Network.’’
Sberbank’s branch network development focuses on large cities and regional centres, where the majority
of the population and business activities are concentrated. In these areas, Sberbank plans to open
medium-sized and large branches (as measured by size and volume of services offered). Sberbank also
plans to open smaller branches, sub-branches and outlets in large shopping and entertainment centres. In
deciding to open a new branch, sub-branch or outlet, Sberbank considers the commercial appeal of the
new location, as well as the rate of return on the investment into the new operation. During 2005,
Sberbank opened 167 new branches, sub-branches and outlets, 65.9% of which were in cities with a
population of over 100,000. In addition, in 2005, 354 branches, sub-branches and outlets were relocated
to new premises, improving their location and infrastructure.
All Sberbank’s branches, sub-branches and outlets use standardised technologies for servicing their
clients. A higher-ranking business unit determines the range and volume of transactions and decision-
making powers delegated to the next lower-ranking business unit, taking into account its client base and
efficiency. Branches and a number of sub-branches have credit committees. See ‘‘—Asset, Liability and
Risk Management—Lending Policies and Procedures.’’

Asset, Liability and Risk Management
Sberbank’s asset and liability management strategy aims to optimise its profitability over time subject to
specific risk parameters and business needs, using an integrated approach to its capital, balance sheet
(assets and liabilities), liquidity and interest rate risk management. Asset and liability management
consists of balance sheet funding and control and evaluation and management of liquidity and market
risks (interest rate risk, currency risk and equity risk).
Sberbank’s Interest Rates and Limits Committee (‘‘IRLC’’) and Credit and Investment Committee
(‘‘CIC’’) are responsible for managing its assets and liabilities. The IRLC functions as an assets and
liabilities committee. Each of Sberbank’s Regional Head Offices has similar committees that operate
within the parameters set for Sberbank as a whole by the IRLC and the CIC. IRLC sets maximum interest
rates for deposits taken from legal entities as well as minimum rates for extending loans to legal entities
and investing in debt securities. It also sets structural limits that restrict market risks and liquidity risk,
including stop-loss limits and limits on the maturity structure of Sberbank’s securities portfolio, and
reviews liquidity and market risk management reports. The work of the IRLC and the CIC is based on

                                                      43
the information prepared by Sberbank’s Finance Department and Risk Management Department
(‘‘RMD’’). The Board approves fundamental decisions of the IRLC and the CIC with respect to liquidity
management and interest rate policy.
Sberbank manages its assets and liabilities in accordance with its business planning system. In accordance
with Sberbank’s strategic plan and based on the analysis of external factors and Sberbank’s internal
capabilities, the Finance Department develops Sberbank’s business plan for the next year, while the
Strategic Planning Department does so for the next two to five years. In their preparation of business
plans, the Finance Department and the Strategic Planning Department use mathematical models of
Sberbank’s asset and liability structure, income and expenses. The business plans set priority business
areas and structure Sberbank’s assets and liabilities in a way that allows it to remain profitable and keep
risks at an acceptable level. Given the possibility of crises in the Russian economy, the composition of
Sberbank’s assets and liabilities is designed based on the results of scenario analysis and stress testing. The
business plans are approved by the Board.
Based on the projected optimal structure of Sberbank’s balance sheet, the Finance Department, in
cooperation with other departments, develops instructions for the Regional Head Offices on how to
structure their assets, liabilities, income and expenses. On the basis of these recommendations, the
Regional Head Offices develop their own business plans, which are approved by the Board.
Lending Policies and Procedures
Individuals
All Sberbank’s branches, sub-branches and outlets follow the same lending procedures. The credit
division, together with the legal and security divisions, review the loan application. A loan officer analyses
the materials provided by the prospective borrower, determines the maximum amount of the loan and
recommends whether the loan should be made. The security division verifies the information presented
by the prospective borrower and, if applicable, the timeliness of salary payments by his or her employer.
The legal division ensures that the documentation presented by the prospective borrower complies with
Russian law.
Depending on the size and terms of the loan, the lending decision is made by a branch, sub-branch or
outlet manager, credit committee of a branch or of the Regional Head Office, or the CIC. The lending
decision is made on the basis of the individual’s income from all sources, employment history, available
credit history, if any, and the security or the guarantees provided. Credit decisions on loans usually take
one to seven business days for personal loans and up to 18 business days for mortgages.
Sberbank usually requires collateral and/or guarantees for loans to individuals. Consumer loans in the
amount of up to RUR45,000 and a term of up to 18 months, consumer loans to borrowers with good credit
history with Sberbank amounting up to U.S.$3,000 and a term of up to 12 months and bank card
overdrafts are unsecured. These loans represented 4.2% of Sberbank’s retail loan portfolio as of
December 31, 2005. Acceptable collateral includes real property, personal property, government and
Sberbank’s own securities, precious metals, cars and other liquid assets. Sberbank accepts guarantees from
individuals and solvent companies that are its clients. The value of the collateral or the amount of the
guarantee must cover the principal and interest on the loan for a period of at least a year. Sberbank
determines its value on the basis of an internal or an independent evaluation or its market price,
discounted appropriately, depending on the type of collateral. Individual guarantors are evaluated in the
same manner as the relevant borrowers. The financial position of guarantors that are legal entities are
evaluated based on their financial condition and market position.
Legal Entities
Sberbank’s lending policies for legal entities focus on the improvement of the credit quality and income
level of its loan portfolio and minimisation and diversification of credit risks. Lending decisions are made,
within established limits, by the CIC at the Central Head Office, credit committees of the Regional Head
Offices and credit committees or asset and liability committees of branches and certain sub-branches. To
minimise credit risk on the branch level, the CIC sets lending limits for the Regional Head Offices and
branches that report to the Central Head Office. The Regional Head Offices then distribute these lending
limits among branches, sub-branches and outlets that report to them. Loans that exceed these lending
limits must be approved by the CIC.
The CIC approves Sberbank’s overall lending limits. See ‘‘—Risk Management—Credit Risk.’’ Each
Regional Head Office is assigned a share of the overall limit, which it then distributes among branches,

                                                      44
sub-branches and outlets that lend to legal entities. Depending on the type and the size of the borrower
and the terms of the loan, lending decisions are made by credit committees at different levels within the
limits set by the CIC. If a loan application exceeds the overall limit of a branch, it is submitted for review
to an upper-level credit committee. Sberbank’s centralised credit approval system allows for a successful
administration of a uniform interest rate policy and uniform internal control and asset and liability
management.
Sberbank’s credit divisions operating within the Credit Department and at Sberbank’s branches and
Regional Head Offices are primarily responsible for credit and bank guarantee approval and work with
the client throughout the life of the loan. The credit division, together with the security, legal and risk
management divisions at the relevant office, branch or sub-branch review the loan application. The legal
division reviews the authority and legal status of the client and makes recommendations on the credit
documentation. The security division reviews the available information about the client’s operations and
business reputation. The risk management division places the potential borrower into a risk category and
assigns it a risk limit.
The lending division reviews the evaluations presented by the security, legal and risk management
divisions and prepares loan approval recommendations, which take into account the potential borrower’s
market position, financial condition, turnover, existing indebtedness and business plan, as well as the
proposed collateral and the transaction being financed. Lending decisions are made by the relevant credit
committee.
Sberbank usually requires collateral and/or guarantees for loans to legal entities. Acceptable collateral
includes real property, securities (within Sberbank’s risk limits for such securities), transportation and
production equipment, inventory, precious metals, certain contract rights and certain personal property.
Sberbank accepts guarantees from controlling shareholders (or other controlling persons) of small
businesses, government entities, banks and other solvent legal entities (all within its risk limits for such
guarantees). A guarantor is evaluated in the same manner as the relevant borrower. In order to reduce
credit risk, several types of collateral may be used simultaneously. The value of the collateral or the
amount of the guarantee must cover the principal and interest on the loan for a period of three months.
Direct debit rights against the Sberbank accounts of the majority of Sberbank’s borrowers serve as
additional assurance for loan repayment.
Depending on the type of collateral, Sberbank determines its value on the basis of an internal or an
independent evaluation or its market price, discounted appropriately. As of December 31, 2005, secured
loans amounted to 90% of Sberbank’s gross loans to legal entities (excluding banks). Borrowers must
either insure their collateral or make a payment to Sberbank reflecting the increase in credit risk due to
the lack of insurance.
To increase its lending volume from clients with which it has long-term relationships and to compete
effectively for the business of major Russian companies in light of the increased presence of foreign
lenders in the Russian market, Sberbank has been providing unsecured or partially secured loans. These
loans are made to major Russian exporters and clients whose financial condition is stable and who have
a good credit history of least three years with Sberbank. A good credit history includes a complete lack
or only a single instance of loan prolongation, absence of overdue loans and lack of delays in meeting
credit and other obligations, such as guarantees and promissory notes. In order to receive such a loan, a
client must agree to channel revenues accounting for at least 10% of the loan amount through its accounts
at Sberbank on a monthly basis. As of December 31, 2005, such partially secured loans amounted to
RUR13.0 billion or 1.0% of Sberbank’s gross loans to legal entities (excluding banks) and unsecured loans
amounted to RUR127.6 billion (including RUR32.3 billion in overdrafts), 9.0% of Sberbank’s gross loans
to legal entities (excluding banks).
Risk Management
Sberbank aims to manage its risk in a way that ensures its positive development. Sberbank’s primary risk
management objectives include:
    •    Having an optimal risk to income ratio in all areas in which Sberbank operates;
    •    Minimisation of losses; and
    •    Reduction of differences between Sberbank’s actual financial results from those envisioned by its
         business plan.
In order to accomplish these objectives, Sberbank seeks sufficient liquidity to match its assets and
liabilities by maturity and currency and to diversify its assets and liabilities by client, region, industry
sector and amount.

                                                     45
Sberbank’s risk control and management system is based on the requirements of the CBR, the
recommendations of the Basle Committee on Banking Supervision and the experience of international
and Russian financial institutions. Sberbank’s approach to risk management takes into account its unique
position as Russia’s largest bank and is based on the following principles:
•   Availability of current and accurate information about various types of risks;
•   Delegation of authority between various departments that engage in operations involving risks and
    departments that manage risks;
•   Existence of risk limits for various positions held by Sberbank;
•   Controlling various banking operations before they take place, while they occur, and after they are
    completed; and
•   Constant improvement of risk management systems.
Sberbank uses the following methods to manage risk:
•   Identification of the major risks arising from Sberbank’s operations;
•   Analysis and evaluation of identified risks and calculation of risks on a consolidated basis;
•   Making decisions as to whether to engage in particular transactions, limiting identified risks and
    establishing reserves for possible losses;
•   Control of compliance with risk management procedures and limiting acceptable risks; and
•   Constant monitoring and allocation of risk limits, taking into account Sberbank’s exposure to
    particular types of risk.
The Board sets Sberbank’s risk management policy with respect to major risks to which Sberbank has
exposure: credit risk, market risks, liquidity risk and operational risk. The Board has delegated some of
its risk management functions to the CIC and the IRLC. The CIC is responsible for day-to-day credit risk
management and the IRLC for day-to-day market and liquidity risk management. The Board is
responsible for managing operational risk. The Board, the CIC and the IRLC conduct their risk
management functions based on the information provided by the Finance Department, the RMD and the
Treasury. The RMD identifies and analyses credit and operational risks and sets credit risk limits. The
Finance Department analyses market and foreign currency risks. It also manages Sberbank’s long-term
liquidity.
The Treasury consolidates market risks of all Sberbank’s business units and manages Sberbank’s
short-term liquidity and its foreign currency positions. These departments operate under their own
management and make independent decisions.
The diagram below shows how risk management responsibility is delegated at Sberbank.

                                                 Board




               Credit and Investment Committee           Interest Rates and Limits Committee




                Risk Management Department           Treasury                  Finance Department



Credit Risk
As a result of its credit operations, Sberbank is exposed to credit risk, which is a risk of a counterparty
being unable to meet its credit obligations in whole or in part when due. The RMD manages Sberbank’s
credit risk in accordance with internal policies and procedures, which are reviewed and updated
periodically, as well as on an ad-hoc basis. Credit risk is also managed through establishing appropriate
allowances for loan losses. Credit risk is evaluated for Sberbank as a whole and for specific asset


                                                    46
categories that are subject to credit risk, as well as on specific credit risks for particular counterparties and
groups of counterparties, countries, geographical regions and industry sectors.
Exposure Limits. To manage its credit risk, Sberbank places its counterparties into risk groups, which
reflect the possibility of default on their obligations. Counterparties placed into particular risk groups are
assigned exposure limits. Sberbank has procedures for calculation and review of risk limits for the
following categories: corporate clients, Russian Federation subjects, municipal bodies, resident banks and
non-resident banks. Exposure limits are also set for foreign countries, single and related borrowers and
banking operations subject to credit risk.
Exposure limits for corporate clients are set on the basis of their ownership structure, business reputation,
credit history, financial condition, future financial trends, quality of financial management, transparency,
industry and regional position and facilities and equipment quality. On the basis of these factors,
corporate clients are placed into risk groups and assigned long-term and short-term exposure limits.
Credit risk of federation subjects and municipal bodies is evaluated on the basis of their financial position
and the level of development. Their financial position is evaluated on the basis of credit history, debt level
and compliance with its budget and budgetary norms. Their level of development is evaluated on the basis
of their current socio-economic development level, future socio-economic development potential and tax
base. Sberbank sets three types of exposure limits for federation subjects and municipal bodies:
short-term (for transactions with a term of no more than one year), temporary (for transactions that take
place before budgets are approved and have a term of no more than three months) and long-term (for
transactions with a term of over one year). These limits are calculated on the basis of the federation
subjects’ budgets for the current year and reports relating to compliance with their budgets for a previous
year. Exposure limits are not set and credit operations are not performed if a federation subject or a
municipal body has no legal basis for credit operations or where its financial position or level of
development indicate that credit transactions are not advisable.
Exposure limits for counterparty banks are set on the basis of their financial condition, position among
comparable banks, transparency of asset and liability structure and operations, operating environment
(for non-resident counterparty banks), capital structure, concentration of banking operations, credit
history, business reputation and relationship with Sberbank. Branch and banking group structure is also
taken into account in setting exposure limits for a particular counterparty bank.
Risk Concentration. In order to reduce and diversify its credit risk, Sberbank monitors its credit risk
concentration, sets exposure limits for single borrowers and groups of related borrowers that are lower
than those set by the CBR and sets limits for loans and bank guarantees made to related parties.
Concentration and exposure limits for large credit operations and related borrowers and high-risk credit
operations are approved at the Central Head Office level.
Monitoring. The RMD regularly monitors credit risks and exposure limits of various counterparties. In
particular, exposure limits for corporate clients are reviewed at least twice a year based on their year-end
and mid-year financial information, for federation subjects and municipal bodies twice a year on the basis
of their approved budgets, for resident banks on a quarterly basis and for non-resident banks and foreign
countries at least once a year. Exposure limits may also be reviewed on an ad-hoc basis.
Off-Balance Sheet Financial Instruments. Credit risk for off-balance sheet financial instruments is
defined as the possibility of sustaining a loss as a result of another party to a financial instrument failing
to perform in accordance with the terms of the contract. Sberbank uses the same credit policies in making
conditional obligations as it does for on-balance sheet financial instruments through credit approval
procedures, exposure limits and monitoring.
Provisions for Loan Impairment
Sberbank classifies loans according to their risk. Impairment losses are recognised when incurred as a
result of one or more loss events that occurred after the initial recognition of the loan and which have an
impact on the amount or timing of the estimated future cash flows of the loan or group of loans that can
be reliably estimated. If Sberbank determines that no objective evidence exists that impairment was
incurred for an individually assessed loan, whether significant or not, it includes the loan in a group with
similar credit risk characteristics and collectively assesses them for impairment. For the purposes of a
collective evaluation of impairment, loans are grouped on the basis of similar credit risk characteristics.
Those characteristics are relevant to the estimation of future cash flows for groups of such assets by being
indicative of the debtors’ ability to pay all amounts due according to the contractual terms of the loans
being evaluated.

                                                      47
Future cash flows of a group of loans that are collectively evaluated for impairment are estimated on the
basis of the contractual cash flows of the relevant loans, the historical loss experience of the extent to
which amounts will become overdue as a result of past loss events and Sberbank’s success of recovery of
overdue amounts. Estimates based on past experience are modified on the basis of current data to reflect
the effects of current conditions that did not affect past periods and to discount the effects of past
conditions that do not currently exist.
Impairment losses are recognised through an allowance account. The loan’s carrying amount is written
down to the present value of expected cash flows (which exclude future credit losses that have not been
incurred) discounted at the original effective interest rate of the loan. The calculation of the present value
of the estimated future cash flows of a secured loan reflects the cash flows that may result from foreclosure
less costs for obtaining and selling the collateral, regardless of whether foreclosure is probable.
After a loan has been written down as a result of impairment, interest income is recognised using the
original interest rate used to discount the future cash flows for the purpose of measuring the impairment
loss. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be
related objectively to an event occurring after the impairment was recognised (such as an improvement
in the debtor’s credit rating), the previously recognised impairment loss is reversed by adjusting the
relevant allowance account.
For new types of loans, where Sberbank has not collected statistics of historical losses, market information
on historical losses of similar groups of loans is used to assess incurred but not yet reported losses on such
groups of loans. In addition, Sberbank’s management accounting system does not, in some cases, allow to
collect all necessary information on incurred losses for certain groups of loans. In such cases, Sberbank’s
management uses estimates and incurred loss models for groups of loans with similar credit risk profile.
Sberbank’s management also is in the process of upgrading its accounting systems to produce all
information required for proper application of loan portfolio impairment assessment. The methodology
and assumptions used for estimating both the amount and timing of future cash flows are reviewed
regularly to reduce any differences between loss estimates and actual loss experience.
Uncollectable assets are written off against the related impairment loss provision after all the necessary
procedures to recover the asset have been completed and the amount of the loss has been determined.
Sberbank reassesses its allowances on a quarterly basis to ensure that they represent the difference
between carrying amounts and the present value of the expected cash flows, including amounts
recoverable from guarantees and collateral, discounted at the original effective interest rate of the loan.
Estimating loan impairment allowances involves the following steps:
•   Identification of loans that are individually significant, i.e., those loans, that, if fully impaired, would
    have a material impact on Sberbank’s expected average level of operating profit.
•   Determination of whether an individually significant loan shows objective evidence of impairment.
    Special emphasis is placed on the timing of the contractual cash flows from interest payments and
    principal repayments. If Sberbank expects to collect all interest and principal due in full, but it is
    probable that those cash flows would be received later than the date agreed in the original contract,
    an impairment assessment is performed. Other impairment indicators include, but are not limited to,
    significant financial difficulties, an actual breach of the loan contract, a high probability of bankruptcy
    or other financial reorganisation of the borrower or a historical pattern of loans collection that
    indicates that the entire principal and interest amount will not be collected.
•   An impairment review of individually significant loans that show objective evidence of impairment.
    The impairment review requires estimating the expected timing and amount of cash flows from
    interest and principal payments and other cash flows, including amounts recoverable from guarantees
    and collateral, and discounting them at the loan’s original effective interest rate. The loan is impaired
    if its carrying amount exceeds its estimated recoverable amount. A separate impairment loss is
    recorded on an individually significant impaired loan.
•   All remaining loans that have not been identified as individually significant are to be assessed on a
    portfolio basis. For the purpose of such a review, loan portfolios are grouped in pools, based on
    similar credit risk characteristics. Such pools include debit card overdraft loans, retail loans, loans to
    small business clients, and overdraft loans to legal entities. Sberbank determines the provision for
    each pool on the basis of statistical data on actual losses and non-recoverable loans over the past
    three years. Loans that have a higher probability of impairment, such as loans made to companies in
    a particular industry, may also be pooled.

                                                     48
The following table sets out details of changes in the provision for loan impairment, excluding loans to
banks, for the years ended December 31, 2005 and 2004.

                                                                                                                    For the year ended December 31,
                                                                                                                        2005                2004
                                                                                                                                         (restated)
                                                                                                                           thousands of RUR
Provision for loan impairment as of January 1 . . . . . . . . . . . . . . . . . . . . .                               79,359,047        66,559,980
Provision for loan impairment during the year . . . . . . . . . . . . . . . . . . . . .                               19,601,682        15,790,772
Loans and advances to customers written off during the year as
  uncollectable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (5,882,594)       (2,991,705)
Provision for loan impairment as of December 31 . . . . . . . . . . . . . . . . . .                                   93,078,135        79,359,047

The following table sets out details of changes in the allowance for loans to banks for the years ended
December 31, 2005 and 2004.

                                                                                                                    For the year ended December 31,
                                                                                                                        2005               2004
                                                                                                                                        (restated)
                                                                                                                           thousands of RUR
Provision for impairment of due from other banks as of January 1 . . .                                                   (1,900)           (76,900)
Due from other banks written off during the year as uncollectable . . .                                                   1,900             75,000
Provision for impairment of due from other banks as of December 31                                                            —              (1,900)

As of December 31, 2005, 1.1% of Sberbank’s gross loan portfolio (excluding loans to banks), or
RUR19.7 billion, were represented by loans where the scheduled payment of principal was overdue by
one day or more. As of that date, all of Sberbank’s gross loans to banks, which amounted to
RUR25.9 billion, performed in accordance with their contractual requirements. The level of non-
performing loans has generally been stable for the past two years. Loans originated by Sberbank by
providing money directly to the borrower or to a sub-participation agent at draw-down are categorised as
loans originated by Sberbank and are carried at amortised cost, less provision for loan impairment.

Market Risks
Overview. Market risk management includes management of interest rate risk, currency risk and equity
risk. Sberbank manages its market risks primarily through transaction limits set by the IRLC. Market risk
limits are set and reviewed at least once a year taking into account the following:
•      Evaluation of possible losses from market risk;
•      Sberbank’s strategic goals;
•      Recommendations of the Basle Committee on Banking Supervision;
•      Current prudential norms set by the CBR;
•      Evaluation and forecasts for the development of the Russian and the international economy; and
•      The transactional volume in the primary segments of the financial and banking services markets.
The IRLC develops market risk management methodologies and sets limits on particular operations for
the Regional Head Offices. The Regional Head Offices have their own interest rates and limits
committees that set limits for their operations on the basis of the methodologies and limits set by IRLC.
If necessary, the Regional Head Offices develop their own methodologies and set their own market risk
limits within the guidelines set by the IRLC.
Market risk limits are set on the basis of value-at-risk analysis, scenario analysis and stress testing.
Interest Rate Risk. Sberbank is exposed to interest rate pricing risk, principally as a result of lending to
clients and other banks at fixed interest rates in amounts and for periods that differ from those of term
deposits and other borrowed funds at fixed interest rates. Due to changes in interest rates, Sberbank’s
liabilities may have disproportionately high interest rates compared to those of its assets and vice versa.
Interest margins on assets and liabilities having different maturities may increase as a result of changes in
market interest rates. In practice, interest rates are often set on a short-term basis and contractually fixed

                                                                                49
interest rates on both assets and liabilities (other than individual deposits) are often reset based on current
market conditions and mutual agreement, which is documented in an addendum to the original agreement
between the relevant client and Sberbank, that sets forth the new interest rate.
Sberbank evaluates its interest rate risk on the basis of analysis of its assets, liabilities and off-balance
sheet obligations by maturity, using gap and duration approaches. It matches interest rates for rouble and
foreign-currency denominated assets and liabilities and identifies mismatches.
Sberbank is also subject to interest rate risk because of changes in the value of government, subfederal,
municipal and corporate debt obligations as a result of interest rate movements. Sberbank’s main source
of this exposure is its Russian government securities trading portfolio.
To manage interest rate risk, the IRLC sets:
•     Limits for debt securities operations, including cumulative limits for investment in government,
      subfederal, municipal and corporate debt securities, portfolio limits on securities, limits on maturity
      structure of government securities portfolio, stop-loss limits on operations with subfederal, municipal
      and corporate debt securities, limits on repo and reverse repo operations, limits on particular types
      and issues of securities and limits on minimum income level on particular securities operations;
•     Uniform fixed interest rates for deposits of and loans to individuals, maximum interest rates on
      deposits of legal entities, minimum interest rates for loans to legal entities, ranges for terms and
      amounts of deposits and loans and categories of clients for deposit and loans. The Board approves
      interest rates for individuals set by the IRLC for the Central Head Office and the Regional Head
      Offices, which are uniform; and
•     Limits on long-term operations with Sberbank’s assets.
The table below summarises the effective average year-end interest rates, by major currencies, for
monetary financial instruments outstanding as of December 31, 2004 and 2005. The analysis has been
prepared on the basis of weighted average interest rates for various financial instruments using year-end
effective rates.

                                                                                                                 As of December 31,
                                                                                                          2005                    2004
                                                                                                                               (restated)
                                                                                                              Other                    Other
                                                                                                  RUR       currencies      RUR     currencies
Assets
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          0.8%             1.6%     0.3%         1.0%
Debt trading securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      4.1%             5.4%     7.7%         5.4%
Other debt securities at fair value through profit or loss . . . . . .                              5.6%             5.5%     6.5%        10.1%
Due from other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         5.7%             2.5%     6.5%         4.9%
Loans and advances to customers . . . . . . . . . . . . . . . . . . . . . . . . .                 14.1%             8.4%    14.4%         8.4%
Debt investment securities available for sale . . . . . . . . . . . . . . . .                       —                —        —          11.0%
Repurchase receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         —              10.7%     —             —
Debt investment securities held to maturity . . . . . . . . . . . . . . . . .                       —              15.8%     —           15.8%

Liabilities
Due to other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     2.0%             5.9%     0.1%         2.0%
Deposits from individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          6.6%             5.2%     7.2%         5.1%
Customer accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      2.1%             2.5%     1.9%         2.2%
Debt securities in issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       1.3%             4.9%     3.7%         3.4%
Other borrowed funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         —                5.9%     —            4.6%
Subordinated debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     —               6.5%      —            —
For the year ended December 31, 2005, Sberbank’s gross interest income was RUR214.3 billion on loans
and advances to customers, RUR29.3 billion on securities and RUR1.9 billion on interbank loans, and its
interest expense was RUR89.1 billion. Its 2005 net interest income was RUR156.4 billion before provision
for loan impairment of RUR19.6 billion.
Currency Risk. Currency risk is the risk that the value of financial instruments will fluctuate due to
changes in foreign exchange rates. Sberbank is exposed to currency risk from holding open positions in
roubles and other currencies, primarily U.S. dollars and euro. To manage and reduce currency risk, the

                                                                            50
IRLC sets overall limits on open currency positions, limits on open currency positions by types of
currencies and precious metals, limits for currency conversion operations and operations with precious
metals on the domestic and foreign markets and stop-loss limits for trading operations in foreign
currencies and precious metals in the domestic and foreign markets. Compliance with these limits is
monitored on a daily basis by the Treasury.

As of December 31, 2005, Sberbank had the following positions in various currencies:

                                                                                 As of December 31, 2005
                                                                                                         Other
                                                       RUR               U.S.$             Euro        currencies        Total
                                                                                    thousands of RUR
Assets
Cash and cash equivalents . . . . .                  88,645,835     12,932,256          20,082,376     1,708,204      123,368,671
Mandatory cash balances with
  the CBRF . . . . . . . . . . . . . . . . .         56,808,779             —                    —             —       56,808,779
Trading securities . . . . . . . . . . . . .         90,664,817     41,150,610                   —             —      131,815,427
Other securities at fair value
  through profit or loss . . . . . . .               227,264,157            16,734               —              —      227,280,891
Due from other banks . . . . . . . .                  5,890,849         1,237,648       18,803,732             —       25,932,229
Loans and advances to
  customers . . . . . . . . . . . . . . . . .      1,364,240,293   397,557,144          24,160,827     1,329,960     1,787,288,224
Repurchase receivable . . . . . . . .                         —      1,658,705                  —             —          1,658,705
Investment securities held to
  maturity . . . . . . . . . . . . . . . . . . .             —      28,398,916                  —             —        28,398,916
Premises and equipment . . . . . .                  106,849,836             —                   —             —       106,849,836
Other assets . . . . . . . . . . . . . . . . .       14,553,812      3,965,326             476,391     4,730,310       23,725,839
Total assets . . . . . . . . . . . . . . . . . .   1,954,918,378   486,917,339          63,523,326     7,768,474     2,513,127,517


Liabilities
Due to other banks . . . . . . . . . . .              20,465,217     3,788,416             427,523       231,104        24,912,260
Deposits from individuals . . . . .                1,237,238,199   225,991,909          48,828,722     2,242,974     1,514,301,804
Customer accounts . . . . . . . . . . .              386,551,681   124,936,106          34,391,968       926,208       546,805,963
Debt securities in issue . . . . . . . .              69,119,322    17,371,023             399,183            —         86,889,528
Other borrowed funds . . . . . . . .                          —     60,603,056           2,360,809            —         62,963,865
Deferred income tax liability . . .                    2,330,419            —                   —             —          2,330,419
Other liabilities . . . . . . . . . . . . . .         13,452,367       870,900              87,134        51,711        14,462,112
Subordinated debt . . . . . . . . . . . .                     —     29,393,050                  —             —         29,393,050
Total liabilities . . . . . . . . . . . . . . .    1,729,157,205   462,954,460          86,495,339     3,451,997     2,282,059,001
Net balance sheet position . . . . .                225,761,173     23,962,879         (22,972,013) 4,316,477         231,068,516
Off-balance sheet notional
  position . . . . . . . . . . . . . . . . . . .     22,187,342    (44,092,065)         20,227,265     2,445,495          768,037
Credit related commitments . . .                    149,644,288    122,415,791          31,300,173         825,347    304,185,599




                                                                   51
As of December 31, 2004, Sberbank had the following positions in various currencies:

                                                                                 As of December 31, 2004 (restated)
                                                                                                                Other
                                                           RUR                   U.S.$          Euro         currencies                 Total
                                                                                         thousands of RUR
Assets
Cash and cash equivalents . . . . .                      78,372,196          13,366,288           16,453,013            945,494     109,136,991
Mandatory cash balances with
  the CBRF . . . . . . . . . . . . . . . . .             44,966,603                  —                     —                 —       44,966,603
Trading securities . . . . . . . . . . . . .             66,984,698          49,428,074               623,922                —      117,036,694
Other securities at fair value
  through profit or loss . . . . . . .                  205,972,611              9,596,558                     —              —      215,569,169
Due from other banks . . . . . . . .                     8,971,876              1,604,821                     —              —       10,576,697
Loans and advances to
  customers . . . . . . . . . . . . . . . . .        1,034,419,224          243,896,576           18,809,024            881,413    1,298,006,237
Investment securities available
  for sale . . . . . . . . . . . . . . . . . . . .                  —             112,296                     —              —           112,296
Investment securities held to
  maturity . . . . . . . . . . . . . . . . . . .                 —           35,650,135                    —                  —       35,650,135
Deferred income tax asset . . . . .                       6,101,084                  —                     —                  —        6,101,084
Premises and equipment . . . . . .                       72,381,032                  —                     —                  —       72,381,032
Other assets . . . . . . . . . . . . . . . . .            7,919,628             333,973               825,060          3,606,357      12,683,018
Total assets . . . . . . . . . . . . . . . . . .     1,526,088,952          353,988,721           36,709,019           5,433,264   1,922,219,956


Liabilities
Due to other banks . . . . . . . . . . .                11,495,749            1,206,397              240,791               6,638      12,949,575
Deposits from individuals . . . . .                    965,623,914          190,168,113           42,705,395           1,419,456   1,199,916,878
Customer accounts . . . . . . . . . . .                321,167,360          106,031,786           26,667,065             518,601     454,384,812
Debt securities in issue . . . . . . . .                56,072,640            6,471,300              769,272                  —       63,313,212
Other borrowed funds . . . . . . . .                            —            28,866,326              896,996                  —       29,763,322
Other liabilities . . . . . . . . . . . . . .            8,216,368              292,547               64,360                 298       8,573,573
Total liabilities . . . . . . . . . . . . . . .      1,362,576,031          333,036,469           71,343,879           1,944,993   1,768,901,372
Net balance sheet position . . . . .                   163,512,921           20,952,252          (34,634,860) 3,488,271             153,318,584
Off-balance sheet notional
  position . . . . . . . . . . . . . . . . . .           (5,514,606) (24,959,768)                 28,925,183           1,637,837          88,646
Credit related commitments . . .                       108,821,333           44,021,682           24,136,610            686,483     177,666,108

The following table sets forth Sberbank’s net foreign currency balance sheet position as of
December 31, 2005 and 2004.

                                                                                                                           As of December 31,
                                                                                                                          2005     2004 (restated)
Net Balance Sheet Position (thousands of RUR) . . . . . . . . . . . . . . . . . . . . . . . . .                         5,307,343 (10,194,337)
As a % of Foreign Currency Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       1.0%       1.8%
As a % of Total Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           2.3%       4.4%
As a % of Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           0.2%       0.4%

Equity Risk. Equity risk is the risk of changes in the value of equity securities as a result of price
movements. To manage equity risk, the IRLC prepares a list of permitted issuers (with whose equity
securities trading operations may be conducted) and sets limits on investment in particular equity
securities for trading or investment purposes, single issuer limits, limits on repo, reverse repo and other
operations in equities and stop-loss limits for the entire portfolio and for each issuer.




                                                                           52
Liquidity Risk

Liquidity risk is the risk of a mismatch between the maturities of assets and liabilities, which may result
in Sberbank being unable to meet its obligations in a timely manner. See ‘‘Risk Factors—Risks Relating
to Sberbank’s Business and Industry—Sberbank cannot completely eliminate liquidity risk.’’ Sberbank is
subject to liquidity requirements set by the CBR. See ‘‘The Banking Sector and Banking Regulation in
Russia—Legislative Framework for the Russian Banking Sector—Banking Supervision—Mandatory
Economic Ratios’’ and ‘‘The Banking Sector and Banking Regulation in Russia—Mandatory Reserve
Requirements.’’

Sberbank is exposed to daily calls on its available cash resources from overnight deposits, current
accounts, maturing deposits, loan drawdowns, guarantees and from margin and other calls on cash-settled
derivative instruments. Sberbank does not maintain cash resources to meet all of these needs as its
experience shows that a minimum level of reinvestment of maturing funds can be predicted with a high
level of certainty. To manage its liquidity risk, Sberbank uses various methods of scenario analysis and
simulations, including optimising and predictive modelling. Sberbank measures its liquidity on a monthly
basis across all maturities on the basis of various economic development scenarios, including a
macroeconomic upheaval similar to the 1998 crisis. This analysis takes into account patterns of changes
in account balances of individuals and legal entities and of loan repayments by clients, as well as the
liquidity of the cash and securities markets. For example, most of retail demand deposits are actually held
for much longer periods and are classified as longer-term liabilities in Sberbank’s liquidity risk model. This
approach enables Sberbank to classify assets and liabilities on the basis of actual periods to maturity,
which differ significantly from contractual maturities, and to obtain an accurate reading of its liquidity
position.

The IRLC reviews the results of scenario analysis of Sberbank’s liquidity on a monthly basis and approves
liquidity ratios at least once a year. These ratios measure the assets that have a particular term against
liabilities that may be repaid during that term. According to the ratios set by the IRLC, assuming that
Sberbank is conducting its operations in a stable economic environment, a liquidity ratio cannot fall below
one, i.e., the amount of assets that have a particular term cannot be less than the amount of liabilities that
may be repaid during that term. If the economic situation deteriorates or there is a risk that the interest
rate limits or liquidity ratios set by the IRLC may be violated, potential liquidity shortages must be
compensated through the implementation of approved liquidity maintenance measures including
changing interest rate policies, selling securities, accessing international and domestic capital markets and
restructuring the portfolio of banking products, as appropriate.

To maintain its short-term liquidity Sberbank takes short-term deposits, enters into repo transactions and
buys and sells foreign currency, securities and precious metals. To maintain its long-term liquidity
Sberbank takes medium and long-term deposits, sells assets such as securities, regulates its interest rate
policies and strives to reduce its expenses.

The following tables sets forth Sberbank’s assets and liabilities by residual maturity as of December 31, 2005
and 2004, including information regarding Sberbank’s liquidity exposure and the maturity profile of its
balance sheet for the respective periods.




                                                     53
                                                                                             As of December 31, 2005
                                                        Demand and
                                                         less than     From 1 to     From 6 to From 1 to More than              No stated
                                                         1 month       6 months      12 months    3 years     3 years           maturity       Total
                                                                                             thousands of RUR
Assets
Cash and cash equivalents . . . . .                      123,368,671           —                —            —            —            —     123,368,671
Mandatory cash balances with the
  CBRF . . . . . . . . . . . . . . . . .                  18,425,330   11,520,581      8,882,016      14,229,938   3,750,914                  56,808,779
Trading securities . . . . . . . . . . .                 131,815,427           —              —               —           —            —     131,815,427
Other securities at fair value
  through profit or loss . . . . . . .                    227,280,891          —           —           —           —                    —   227,280,891
Due from other banks . . . . . . . .                      24,443,512     538,894          —      949,823          —                    —    25,932,229
Loans and advances to customers .                        111,181,990 459,910,604 404,487,996 467,358,496 344,349,138                   — 1,787,288,224
Repurchase receivable . . . . . . . .                             —    1,658,705          —           —           —                    —     1,658,705
Investment securities held to
  maturity . . . . . . . . . . . . . . . .                        —           —           —           — 28,398,916            —     28,398,916
Premises and equipment . . . . . .                                —           —           —           —           — 106,849,836    106,849,836
Other assets . . . . . . . . . . . . . . .                20,765,581     735,978     230,085     507,721     205,550   1,280,924    23,725,839
Total assets . . . . . . . . . . . . . . .               657,281,402 474,364,762 413,600,097 483,045,978 376,704,518 108,130,760 2,513,127,517
Liabilities . . . . . . . . . . . . . .     .   .   .
Due to other banks . . . . . . .            .   .   .     23,440,572   1,471,688          —           —           —                     —     24,912,260
Deposits from individuals . .               .   .   .    257,084,939 343,493,666 286,604,122 495,224,994 131,894,083                    — 1,514,301,804
Customer accounts . . . . . . .             .   .   .    411,413,702 74,490,290 35,648,761 21,058,514      4,194,696                    —    546,805,963
Debt securities in issue . . . .            .   .   .     57,479,390 12,210,122 15,695,633     1,494,833       9,550                    —     86,889,528
Other borrowed funds . . . . .              .   .   .             —      887,912          — 30,133,645 31,942,308                       —     62,963,865
Deferred income tax liability               .   .   .             —           —           —           —           —              2,330,419     2,330,419
Other liabilities . . . . . . . . . .       .   .   .      6,026,295   7,132,356      82,970     870,485     321,426                28,580    14,462,112
Subordinated debt . . . . . . . .           .   .   .             —           —           —           — 29,393,050                      —     29,393,050
Total liabilities . . . . . . . . . .       .   .   .    755,444,898 439,686,034 338,031,486 548,782,471 197,755,113             2,358,999 2,282,059,001
Net liquidity gap . . . . . . . . . . . .                (98,163,496) 34,678,728      75,568,611 (65,736,493) 178,949,405 105,771,761        231,068,516
Cumulative liquidity gap at
 December 31, 2005 . . . . . . . . .                     (98,163,496) (63,484,768) 12,083,843 (53,652,650) 125,296,755 231,068,516                     —


                                                                                             As of December 31, 2004
                                                                                                    (restated)
                                                        Demand and
                                                         less than     From 1 to      From 6 to From 1 to More than             No stated
                                                         1 month       6 months       12 months     3 years    3 years          maturity       Total
                                                                                              thousands of RUR
Assets
Cash and cash equivalents . . . . .                      109,136,991           —                —             —           —            —     109,136,991
Mandatory cash balances with the
  CBRF . . . . . . . . . . . . . . . . . .                16,674,795    11,637,042        5,490,453    8,723,115    2,441,198          —      44,966,603
Trading securities . . . . . . . . . . .                 117,036,694            —                —            —            —           —     117,036,694
Other securities at fair value
  through profit or loss . . . . . . .                    215,569,169            —           —           —           —                  —   215,569,169
Due from other banks . . . . . . . .                       3,180,574     6,452,667          —      943,456          —                  —    10,576,697
Loans and advances to customers .                        118,025,607   335,740,039 312,370,780 331,982,976 199,886,835                 — 1,298,006,237
Investment securities available for
  sale . . . . . . . . . . . . . . . . . . .                     —             —           112,296            —           —            —         112,296
Investment securities held to
  maturity . . . . . . . . . . . . . . . .                        —             —           —           — 35,650,135                    —     35,650,135
Deferred income tax asset . . . . .                               —             —           —           —           —            6,101,084     6,101,084
Premises and equipment . . . . . .                                —             —           —           —           —           72,381,032    72,381,032
Other assets . . . . . . . . . . . . . . .                 8,996,799     1,388,303     693,711     729,852     198,442             675,911    12,683,018
Total assets . . . . . . . . . . . . . . .               588,620,629   355,218,051 318,667,240 342,379,399 238,176,610          79,158,027 1,922,219,956
Liabilities
Due to other banks . . . . .        .   .   .   .   .     12,949,575            —           —           —                  —            —     12,949,575
Deposits from individuals           .   .   .   .   .    241,643,480   378,495,362 193,638,223 297,112,558         89,027,255           — 1,199,916,878
Customer accounts . . . . .         .   .   .   .   .    371,814,950    49,626,318   8,353,153 23,807,042             783,349           — 454,384,812
Debt securities in issue . .        .   .   .   .   .     46,495,606    13,031,764   3,038,812     737,517              9,513           —     63,313,212
Other borrowed funds . . .          .   .   .   .   .     27,781,693     1,981,629          —           —                  —            —     29,763,322
Other liabilities . . . . . . . .   .   .   .   .   .      6,369,197       668,422     388,952     946,270            198,643        2,089     8,573,573
Total liabilities . . . . . . . .   .   .   .   .   .    707,054,501   443,803,495 205,419,140 322,603,387         90,018,760        2,089 1,768,901,372
Net liquidity gap . . . . . . . . . . . .               (118,433,872) (88,585,444) 113,248,100        19,776,012 148,157,850    79,155,938   153,318,584
Cumulative liquidity gap at
 December 31, 2004 . . . . . . . .                      (118,433,872) (207,019,316) (93,771,216) (73,995,204) 74,162,646 153,318,584                   —




                                                                                     54
As noted above, Sberbank believes that despite a substantial portion of individual client deposits being
on-demand, diversification of these deposits by number and type of depositors and Sberbank’s past
experience indicates that these deposits provide a long-term and stable source of funding. Accordingly,
Sberbank believes that liquidity gaps based on the contractual maturities of its deposits are not necessarily
indicative of its actual liquidity position, as determined by its liquidity analyses described above.
Sberbank’s portfolio of financial assets available-for sale, which consists primarily of securities, is
presented above according to the contractual maturities of the relevant financial assets. These financial
assets represent an additional source of liquidity for Sberbank.
The following table sets out certain ratios as of December 31, 2005 and 2004.

                                                                                                       As of December 31,
                                                                                                       2005          2004
                                                                                                                  (restated)
Loans and advances to clients(1) as % of total assets . . . . . . . . . . . . . . . . . . . . . . .    71.1%        67.5%
Loans and advances to clients(1) as % of client accounts(2) . . . . . . . . . . . . . . . . . .        86.7%        78.5%
Loans and advances to clients(1) as % of total equity . . . . . . . . . . . . . . . . . . . . . . .   773.4%       846.7%
(1)   Net of provisions for loan impairment.
(2)   Calculated as a sum of customer accounts and deposits from individuals.

Operational Risk
Operational risk is the risk of loss resulting from the inadequacy or failure of internal processes or systems
or from external events. Sberbank minimises operational risk by maintaining controls over all of its
operations. Banking transactions may not take place without appropriate internal regulations or decisions
of responsible bodies within Sberbank.
Sberbank has in place an internal control system, and certain risks that cannot be controlled or minimised
by Sberbank are managed by obtaining outside insurance.
In order to accurately assess and predict the level of operational risks, Sberbank compiles and organises
information relating to all operational risk events that have taken place in a proprietary database. This
information is used for further analysis, evaluation and forecasts of its aggregate operational risk using
mathematical methods and models. This database includes detailed information about each occurrence of
a risk event: its date, substance, source, length and amount of direct and indirect losses and frequency.
Sberbank’s Internal Control, Revisions and Audit Department (‘‘ICRAD’’) is responsible for evaluating
and improving Sberbank’s system of internal controls. ICRAD regularly audits all of Sberbank’s activities
and evaluates internal control processes and procedures related to banking operations, accounting and
financial reporting and IT systems for compliance with internal policies and procedures as well as with
CBR requirements.
Sberbank’s Legal Department is responsible for legal compliance and legal policies. Sberbank uses
standardised master agreements approved by the Legal Department for transactions with its counterparties.
Non-standardised agreements are reviewed and approved by the Legal Department. The Legal
Department also reviews all relevant counterparty documentation. Sberbank retains international law
firms to represent it in international transactions.

Anti-Money Laundering Procedures
Sberbank’s anti-money laundering measures are based on the relevant Russian legislation and the CBR
regulations. See ‘‘The Banking Sector and Banking Regulation in Russia—Legislative Framework for the
Russian Banking Sector.’’ Sberbank has procedures and operative documents aimed at preventing money
laundering and terrorist financing, including a general anti-money laundering policy and internal control
procedures and rules on counteracting money laundering and financing of individuals and legal entities
engaged in terrorist activities. Sberbank regularly conducts employee education and training programs
targeted at raising awareness levels and developing skills to counteract money laundering and financing
of individuals and legal entities engaged in terrorist activities.
Anti-money laundering procedures include ‘‘know-your-customer’’ procedures that require clear
identification of clients, verification of their identity, appraisal of risk of their engaging in money
laundering and/or terrorist financing and maintaining their records. If the risk of particular clients
engaging in money laundering and/or terrorist financing is determined to be significant, the activities of

                                                               55
such clients are monitored regularly. Sberbank reports certain transactions to the Federal Service for
Financial Monitoring and occasionally seeks to close relationships with clients or cease to conduct
business with clients if it believes there is a risk of money laundering and/or terrorist financing.

IT Infrastructure
Information technology (‘‘IT’’) is an integral part of Sberbank’s daily operations and an essential
component of its success. Sberbank is committed to improving its existing IT infrastructure and continuing
to invest in IT in order to support its operations in the future. See ‘‘—Business Strategy—Internal
Development—Information Systems and Technologies.’’ In 2005, Sberbank invested approximately
RUR13.1 billion in the development of its IT infrastructure.
Sberbank’s IT systems currently function on four levels: Central Head Office, Regional Head Offices,
branches and sub-branches. A core information system at the Central Head Office level supports
accounting, financial reporting, bank card transaction processing, settlement and depositary and treasury
operations throughout Sberbank, and client banking operations and billing technologies in Moscow. All
the computer and telecommunication systems used at Sberbank are based on software provided by
leading manufacturers.
Each Regional Head Office has a core information system that supports its operations and the operations
of branches connected to it. A wide range of banking operations performed at the branch level is
automated. The level of automation of a branch’s operations and the necessity of its connection to the
core information system of the Regional Head Office is made on the basis of economic necessity.
Sberbank is in the process of standardising the IT systems used for client operations. Currently, four
standard systems support corporate client operations, and another four standard systems support retail
client operations.
Sberbank is continuously developing its corporate telecommunications network, which permits
implementation of new automated bank technologies. Telecommunication systems are developed using
standardised technical solutions and both ground and satellite channels. Sberbank’s telecommunication
system connects the Central Head Office to the Regional Head Offices, which are then connected to
branches. It provides a wide range of services, such as simultaneous voice, video and data transmission
through Sberbank. This system is built on uniform standards thus allowing its range and capacity to be
increased with minimal expenditure.
Sberbank regularly takes measures to reduce risks related to electronic information transmission and
processing, including periodic evaluations, tests and implementation of appropriate redundancies. To
maintain business continuity, Sberbank has established reserve computer centres at the Central Head
Office and the Regional Head Offices and is creating reserve systems that would allow business continuity
in case of occurrence of local interruptions monitoring systems of its IT infrastructure. It is also putting
in place emergency plans and is training its IT personnel to handle exceptional circumstances. All of
Sberbank’s computer systems are protected from virus attacks and power supply interruptions. Backups
of the data are conducted on a regular basis.

Employees
The average number of Sberbank’s employees during 2005 was 235,116. As of December 31, 2005, 24,364
of Sberbank’s employees were based in Moscow. The Russian labour market for qualified banking
personnel, especially for junior and middle management, is highly competitive. Sberbank has established
a system for selecting and employing highly qualified personnel. It is aggressively recruiting experienced
managers and specialists from other financial institutions, with the emphasis on risk and profitability
evaluation experts, credit specialists and project managers.
Sberbank has established a system for selecting and employing highly qualified graduates from the leading
Russian institutions of higher learning, primarily in the branches, sub-branches and outlets providing
services to the clients. When recruiting employees to service Sberbank’s clients, special attention is paid
to their knowledge of operational procedures, banking product range and sales and client contact skills.
Sberbank has recently introduced internal certification standards for its operational personnel.
Sberbank has also been rotating the most qualified managers among its various departments. Employees
with high personal and professional potential and organisational skills are included in the pool of
candidates for key management positions. Sberbank also enhances the quality of its personnel through
internal evaluations.

                                                    56
Sberbank’s salary structure is commensurate with that of other leading Russian banks. Sberbank’s payroll
and other staff costs accounted for 59.7% of its administrative and other operating expenses in 2005. The
existing compensation system provides for a combination of monetary and non-monetary performance
rewards and various incentives for employees in different professional various categories.
Approximately 80% of Sberbank’s employees belonged to the all-Russia Sberbank labour union as of
December 31, 2005. Sberbank has never experienced any strikes, work stoppages, labour disputes or
actions that have affected the operation of its business, and Sberbank considers its relationship with its
employees to be good.

Litigation
Sberbank is from time to time the subject of legal proceedings and other investigations in the ordinary
course of its business. The Russian Federal Antimonopoly Service (the ‘‘FAS’’) periodically investigates
certain practices and procedures used by Sberbank in conducting its business. The vast majority of these
investigations were either terminated by the FAS or discontinued once Sberbank demonstrated the
reasons for particular business practices.
In December 2005, Sberbank commenced a litigation proceeding in the English High Court of Justice
against Refco Securities LLC, a U.S. entity, for a return of excess collateral securing a loan made in the
course of a repo transaction and related damages in the amount of approximately U.S.$121 million, which
was disclosed as a contingent asset in the notes to the IFRS Financial Statements and was not recognised
in its balance sheet as of December 31, 2005. See Note 32 to the IFRS Financial Statements. On March
17, 2006, Sberbank obtained a judgement against Refco Securities LLC in the English High Court of
Justice and was awarded damages in the amount of approximately U.S.$121.7 million. Refco Securities
LLC has not appealed the judgment. Sberbank is in the process of enforcing the English court’s judgement
in the United States. As of the date of this Prospectus, Sberbank was not a party to any other material
legal or regulatory proceedings or investigations.

Subsidiaries
As of the date of the Prospectus, Sberbank had no material subsidiaries.




                                                   57
                                                                  FINANCIAL REVIEW

The following discussion and analysis should be read in conjunction with Sberbank’s IFRS Financial
Statements appearing elsewhere herein. Unless otherwise specified, the financial data set forth below have
been extracted, without material adjustments, from the IFRS Financial Statements.

Adoption of New or Revised Standards and Interpretations

Certain new IFRSs became effective for Sberbank from January 1, 2005. All such changes in accounting
policies were applied retrospectively. The nature of the adjustments made due to application of new
IFRSs and its effect to corresponding information for the year ended December 31, 2004 is disclosed in
the Note 5 to the IFRS Financial Statements.

All financial information of Sberbank as of and for the year ended December 31, 2004 contained in this
Base Prospectus is presented on a restated basis, taking into account the results of retrospective, adoption
of new or revised IFRSs.

This Base Prospectus includes, on pages F-64 through F-103, the Unrestated Financial Statements. The
Unrestated Financial Statements have not been adjusted to take into account certain changes in IFRSs
that were effective in 2005. Accordingly, the Unrestated IFRS Financial Statements are not comparable
to, and should not be compared with, the IFRS Financial Statements.

Results of Operations for the Years Ended December 31, 2005 and 2004
Sberbank’s income statement for the years ended December 31, 2005 and 2004 is set forth below:
                                                                                                                      For the year ended December 31,
                                                                                                                          2005                2004
                                                                                                                                           (restated)
                                                                                                                             thousands of RUR
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           245,521,854         166,734,284
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           (89,148,954)        (84,930,051)
Net interest income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              156,372,900          81,804,233
Provision for loan impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       (19,601,682)        (15,790,772)
Net interest income after provision for loan impairment. . . . . . . . . . .                                          136,771,218          66,013,461
Gains less losses arising from trading securities and other securities
  at fair value through profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          16,144,622          13,862,219
Gains less losses arising from investment securities available for
  sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          4,709          2,830,446
Gains arising from investment securities held to maturity. . . . . . . . . .                                             4,180,969                 —
(Losses net of gains)/gains less losses from trading in foreign
  currencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            (730,563)         5,017,305
Foreign exchange translation gains less losses . . . . . . . . . . . . . . . . . . . .                                   5,920,153         (1,598,441)
Fee and commission income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                         36,929,702         26,198,106
Fee and commission expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          (1,146,784)          (741,559)
Other operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    3,920,700          2,093,217
Operating profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             201,994,726        113,674,754
Administrative and other operating expenses . . . . . . . . . . . . . . . . . . . .                                   (114,373,230)       (90,587,654)
Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              87,621,496         23,087,100
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 (21,813,964)        (4,919,463)
Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              65,807,532         18,167,637
Earnings per ordinary share, basic and diluted (RUR per share) . . .                                                         3,454                 949

Interest Income
Sberbank’s interest income increased by 47.3% in 2005, to RUR245.5 billion, from RUR166.7 billion in
2004. The following table sets forth the principal components of Sberbank’s interest income for the years
ended December 31, 2005 and 2004:




                                                                                     58
                                                                                                          For the year ended December 31,
                                                                                                             2005                 2004
                                                                                                                               (restated)
                                                                                                                 thousands of RUR


Loans and advances to customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               214,274,900         139,869,305
Debt trading securities and other securities
  at fair value through profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . .              24,191,659          15,041,376
Investment securities held to maturity . . . . . . . . . . . . . . . . . . . . . . . . . .                  5,105,034           5,273,870
Due from other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        1,890,479           6,064,116
Correspondent accounts with other banks . . . . . . . . . . . . . . . . . . . . . . .                          57,498              22,645
Debt investment securities available for sale . . . . . . . . . . . . . . . . . . . . .                         2,284             462,972

Total interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   245,521,854         166,734,284

The increase in Sberbank’s 2005 interest income resulted primarily from the increase in interest income
on loans and advances to customers by 53.2%, to RUR214.3 billion, from RUR139.9 billion in 2004. This
increase resulted primarily from an increase in Sberbank’s average balances of loans and advances to
customers by 48% during 2005. The average interest rate on Sberbank’s loans and advances to customers
during 2005 was 12.9%, compared to 13.4% in 2004. The average interest rate decrease was attributable
to lower interest rates charged on loans to customers in 2005. This decrease was offset, in part, by growth
in Sberbank’s fee, from lending operations, classified as interest income included in amortised cost
calculation for the purposes of the IFRS Financial Statements.
The increase in interest income on debt securities and other securities at fair value through profit or loss
of 61.3%, to RUR24.2 billion, from RUR15.0 billion in 2004, also contributed to the overall increase in
Sberbank’s interest income. This increase was due, in part, to the increase in the size of Sberbank’s
securities portfolio and in part to changes in the structure of the securities portfolio as Sberbank increased
the share of rouble-denominated bonds in its securities portfolio. The 154.4% increase in 2005, to
RUR57.5 million, from RUR22.6 million in 2004, in interest income on Sberbank’s correspondent
accounts with other banks also contributed to the overall increase in Sberbank’s interest income.
The impact of the increases described above was partially offset by a 68.9% decrease, to RUR1.9 billion,
from RUR6.1 billion in 2004, in interest on income due from other banks, which resulted from a decrease
in the total volume of operations (including decrease of reverse repo operations during 2005); a 99.6%
decrease, to RUR2 million, from RUR463.0 million in 2004, in interest on debt securities available for
sale, as the debt securities held in Sberbank’s available for sale portfolio were sold in early 2005; and a
3.8% decrease, to RUR5.1 billion, from RUR5.3 billion in 2004, in interest income received on investment
securities held to maturity which resulted from a 20.3% decline in the amortised value of investment
securities held to maturity in late 2005.
Interest Expense
Sberbank’s interest expense increased by 5.0% in 2005, to RUR89.1 billion, from RUR84.9 billion in 2004.
The following table sets forth the principal components of Sberbank’s interest income for the years ended
December 31, 2005 and 2004:
                                                                                                          For the year ended December 31,
                                                                                                             2005                 2004
                                                                                                                               (restated)
                                                                                                                 thousands of RUR
Term deposits of individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         73,286,161          74,882,057
Term deposits of legal entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           6,360,540           2,583,698
Current/settlement accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           4,831,151           3,738,628
Other borrowed funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        2,838,031             962,516
Term placements of other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  734,779             321,288
Debt securities in issue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       705,443           2,275,188
Correspondent accounts of other banks . . . . . . . . . . . . . . . . . . . . . . . . .                       392,849             166,676

Total interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    89,148,954          84,930,051

The overall increase in Sberbank’s 2005 interest expense resulted from a 146.2% increase, to RUR6.4 billion,
from RUR2.6 billion in 2004, in interest expense on term deposits of legal entities, which resulted from

                                                                            59
growth in client deposit balances, particularly deposits in foreign currencies (U.S. dollars and euro). For
similar reasons, interest expense on current/settlement accounts increased by 29.7% in 2005, to
RUR4.8 billion, from RUR3.7 billion in 2004. Interest expense on other borrowed funds increased by
190.9%, to RUR2.8 billion in 2005, from RUR962.5 million in 2004, as Sberbank obtained additional
funding in the international and domestic markets. Interest expense on term placements of other banks
increased by 128.7%, to RUR734.8 million in 2005, from RUR321.3 million in 2004, due to an increase in
the volume of Sberbank’s operations with other banks during 2005 and, for the same reason, interest
expense on correspondent accounts of other banks increased by 135.6%, to RUR392.8 million in 2005,
from RUR166.7 million in 2004. These increases were partially offset by a 69.3% decrease in interest
expense on debt securities in issue, from RUR2.3 billion in 2004 to RUR705.4 million in 2005, which was
due to a decrease in interest rates on securities recently issued by Sberbank, which reflected the general
trend in the Russian market, and a 2.1% decrease, from RUR74.9 billion in 2004 to RUR73.3 billion in
2005, in interest expense on term deposits to individuals, which resulted from periodic downward
revaluations of interest rates on long-term retail deposits, which were consistent with the general trend of
declining interest rates on such deposits in the Russian market as well as the continuing effect of similar
revaluations that took place in 2004 and 2003.

Net Interest Income
For the reasons described above, Sberbank’s net interest income increased by 91.2% in 2005, to
RUR156.4 billion, from RUR81.8 billion in 2004. Sberbank’s net interest margin, calculated as the ratio
of net interest income before provision for loan impairment to average interest-bearing assets, was 8.1%
in 2005, compared to 5.6% in 2004. The increase of the margin was due to a significant increase in the
interest income on loans to clients as opposed to a relatively stable level of interest expenses on client
deposits and other liabilities.

Provision for Loan Impairment
Sberbank’s provision for loan impairment increased by 24.1% in 2005, to RUR19.6 billion, from
RUR15.8 billion in 2004, as a result of the 36.5% growth in Sberbank’s loan portfolio during 2005.
Sberbank’s ratio of provisions for loan impairment to gross loans and advances is declining, as the quality
of its loan portfolio is continuing to improve. This ratio was 5.0% in 2005 and 5.8% in 2004. For details
of movements in Sberbank’s provision for loan impairment, see ‘‘—Selected Statistical and Other
Information.’’

Gains Arising From Investment Securities Held to Maturity
In 2005, Sberbank disposed of certain securities classified as investment securities held to maturity that
were pledged as collateral for borrowings from Refco Securities LLC, a foreign counterparty, under repo
and reverse repo transactions. The parent company of Refco Securities LLC subsequently filed for
bankruptcy. See ‘‘Business—Litigation.’’ As a result of a settlement transaction with Refco Securities LLC
Sberbank had a net gain from dealing with investment securities held to maturity of RUR4.2 billion.
Sberbank did not engage in similar transactions in 2004.

(Losses Net of Gains)/Gains Less Losses From Trading in Foreign Currencies and Foreign Exchange
Translations Gains and Losses
In 2005, Sberbank had a net loss from dealing in foreign currencies of RUR730.6 million, compared to a
net gain of RUR5.0 billion in 2004. In that year, Sberbank also had a foreign exchange translation gain
of RUR5.9 billion, a RUR7.5 billion increase from a foreign exchange translation loss of RUR1.6 billion
in 2004. In 2005, as well as in 2004, Sberbank had a long net balance sheet position in U.S. dollars and a
short net balance sheet position in euro. As a result, and taking into account the fluctuations in the value
of the rouble against the U.S. dollar and the euro in 2005 and 2004, Sberbank had a net foreign currency
translation gain in 2005 and a net foreign currency translation loss in 2004. In addition, in both 2005 and
2004, in order to hedge its open foreign currency positions, Sberbank engaged in trading operations with
U.S. dollars and euro. These operations resulted in net losses from trading in foreign currencies in 2005
and net gains from trading in foreign currencies in 2004.

Net Fee and Commission Income
Sberbank’s net fee and commission income increased by 40.4% in 2005, to RUR35.8 billion, from
RUR25.5 billion in 2004. This increase was attributable to the increase in the volume of Sberbank’s cash

                                                    60
transactions, plastic card operations, foreign currency operations, settlement transactions and cash
collection operations, which represented 96.7% of Sberbank’s gross fee and commission income both in
2005 and 2004.

Administrative and Other Operating Expenses

Sberbank’s administrative and other operating expenses increased by 26.3% in 2005, to RUR114.4 billion,
from RUR90.6 billion in 2004. The following table sets forth the principal components of Sberbank’s
operating expenses for 2005 and 2004.
                                                                                                                      For the year ended December 31,
                                                                                                                          2005                2004
                                                                                                                                           (restated)
                                                                                                                             thousands of RUR
Staff costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      68,316,065          54,917,708
Depreciation of premises and equipment . . . . . . . . . . . . . . . . . . . . . . . .                                 10,675,812           8,715,009
Administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    12,227,390           9,292,549
State deposit insurance system membership fee . . . . . . . . . . . . . . . . . .                                       7,682,868                  —
Other costs of premises and equipment . . . . . . . . . . . . . . . . . . . . . . . . .                                 5,924,490           4,673,145
Taxes other than on income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        4,028,832           7,849,462
Advertising and marketing services . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                            1,736,235           1,021,386
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 244,749             153,949
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     3,536,789           3,964,446

Total administrative and other operating expenses . . . . . . . . . . . . . . . .                                     114,373,230          90,587,654

Staff costs represent the largest single component of Sberbank’s operating expenses. Staff costs increased
by 24.4% in 2005, to RUR68.3 billion (including social tax expenses), from RUR54.9 billion in 2004, due
to an increase in the remuneration level of Sberbank’s employees, which was in line with inflation in 2005
and also took into account increased competition for highly qualified employees in the Russian labour
market. An increase in the average number of Sberbank’s employees during 2005 also affected the staff
cost growth.

Income Tax Expense

Sberbank’s income tax expense increased by 344.9% in 2005, to RUR21.8 billion, from RUR4.9 billion in
2004. This increase resulted from the 279.2% increase in Sberbank’s profit before tax, to RUR87.6 billion,
from RUR23.1 billion in 2004, as well as from the effect of certain temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax
purposes. For an explanation of these temporary differences, see Note 28 to the IFRS Financial
Statements.

Funding

Sberbank has a large and well-diversified funding base. Deposits from individuals and legal entities are its
main source of funds. Sberbank also obtains funding through issuing debt securities in the domestic and
the international markets.

The total amount of Sberbank’s client deposits grew by 24.6% in 2005, to RUR2,061.1 billion, in line with
the growth of Sberbank’s asset base and remained the largest component of its funding. In 2005, deposits
from retail clients represented 73.5% of Sberbank’s client deposits. In absolute terms, in 2005 deposits
from individuals grew by 26.2%, to RUR1,514.3 billion, and deposits from legal entities by 20.3%, to
RUR546.8 billion. The percentage of retail deposits with a contractual term of more than one year grew
from 32.2% of Sberbank’s retail deposit portfolio in 2004, or RUR386.1 million, to 41.4% in 2005, or
RUR627.1 million.

Client deposits accounted for 90.3% of Sberbank’s liabilities as of December 31, 2005, compared to 93.5%
as of December 31, 2004. The following table sets forth the composition of Sberbank’s client deposit
portfolio as of December 31, 2005 and 2004.



                                                                                     61
                                                                                                                      As of December 31,
                                                                                                                   2005                 2004
                                                                                                                                     (restated)
                                                                                                                       thousands of RUR
Individuals
Current/demand accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                136,100,326         99,793,569
Term deposits(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1,378,201,478      1,100,123,309
Total individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    1,514,301,804      1,199,916,878

Legal entities
State and public organisations
Current/settlement accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                53,411,194           45,128,341
Term deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     16,125,577            5,633,906
Other legal entities
Current/settlement accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               352,348,281         318,804,159
Term deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    124,920,911          84,818,406
Total legal entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    546,805,963         454,384,812

Total deposits from individuals and legal entities . . . . . . . . . . . . . . . . .                           2,061,107,767      1,654,301,690


(1)    Term deposits, under Russian law, are effectively on demand. See ‘‘Risk Factors—Risks Relating to Sberbank’s Business and
       Industry—Sberbank cannot completely eliminate liquidity risk.’’

In addition, Sberbank obtains funding through loans funded by bond issuances by a third-party issuer in
the international capital markets, syndicated loans and foreign export credit agencies via foreign banks.
The following table sets forth the composition of Sberbank’s other borrowed funds as of December 31, 2005
and 2004.
                                                                                                                        As of December 31,
                                                                                                                     2005                 2004
                                                                                                                                       (restated)
                                                                                                                         thousands of RUR
Long-term loans received(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               57,597,510           27,781,693
Term borrowings(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          5,366,355            1,981,629
Total other borrowed funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                62,963,865           29,763,322


(1)    Including eurobonds issued by UBS Luxembourg S.A. in the amount of RUR28.9 billion, with the proceeds on-lent to
       Sberbank.

(2)    Represent funding received by Sberbank from foreign export credit agencies via foreign banks and used for lending to Russian
       companies.

Sberbank’s debt securities issued in the domestic markets also serve as sources of funding. Sberbank’s debt
securities in issue grew by 37.3% in 2005, to RUR86.9 billion, to represent 3.8% of its liabilities as of
December 31, 2005. The following table sets out Sberbank’s debt securities issued as of December 31, 2005
and 2004.
                                                                                                                        As of December 31,
                                                                                                                     2005                 2004
                                                                                                                                       (restated)
                                                                                                                         thousands of RUR
Promissory notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       79,263,453           58,849,276
Savings certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         6,297,898            3,460,216
Deposit certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         1,328,177            1,003,720
Total debt securities in issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             86,889,528           63,313,212

Sberbank also engages in some interbank borrowings, primarily as part of its correspondent banking
business and in order to regulate its liquidity. The following table shows Sberbank’s short-term borrowings
as of December 31, 2005 and 2004.



                                                                                62
                                                                                                                            As of December 31,
                                                                                                                         2005                 2004
                                                                                                                                           (restated)
                                                                                                                             thousands of RUR
Correspondent accounts and overnight placements of other banks . .                                                    22,833,359          11,847,388
Current term placements of other banks . . . . . . . . . . . . . . . . . . . . . . . .                                   607,214           1,102,187
Sale and repurchase agreements with other banks . . . . . . . . . . . . . . . .                                        1,471,687                  —
Total due to other banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  24,912,260          12,949,575


Selected Statistical and Other Information
The following selected and other financial information is derived, where applicable, from Sberbank’s
IFRS Financial Statements.

Loan Portfolio
Sberbank lends to companies, government bodies, banks, other legal entities and individuals in Russia.
Interest rates on various types of loans are set by IRLC and, in the case of individuals, approved by the
Board. See ‘‘—Asset and Liability Management—Risk Management—Market Risks—Interest Rate
Risk.’’
Client Concentration. As of December 31, 2005, 16.6% of Sberbank’s gross loan portfolio consisted of
loans to the top ten corporate borrowers, a decrease from 21.6% as of December 31, 2004.
The following table sets forth the structure of Sberbank’s gross loan portfolio (excluding loans to banks)
by economic sector as of December 31, 2005 and 2004.

                                                                                                                     As of December 31,
                                                                                                             2005                       2004
                                                                                                                                     (restated)
                                                                                                      thousands of              thousands of
                                                                                                         RUR             %         RUR            %
Individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       467,832,784       24.9    265,751,772       19.3
Trade(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    405,490,914       21.6    299,159,621       21.7
Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    190,506,039       10.1    107,192,945        7.8
Food and agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              159,428,332        8.5    123,539,954        9.0
Machine building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            135,887,258        7.2    125,228,820        9.1
Oil, gas and chemical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               123,466,860        6.6    109,251,667        7.9
Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     69,938,861        3.7     49,207,377        3.6
Metallurgy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       69,498,084        3.7     81,950,392        5.9
Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         54,536,141        2.9     51,140,827        3.7
Telecommunications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 48,563,580        2.6     59,063,106        4.3
Transport, aviation, space industry . . . . . . . . . . . . . . . . . . . . . .                        33,848,765        1.8     44,278,031        3.2
Timber industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            19,208,393        1.0     23,360,609        1.7
Government and municipal bodies . . . . . . . . . . . . . . . . . . . . . .                            10,450,106        0.5      7,884,805        0.6
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    91,710,242        4.9     30,355,358        2.2

Total loans and advances to customers (before impairment) 1,880,366,359 100.0 1,377,365,284 100.0


(1)    Refers to companies engaged in retail and wholesale trading.




                                                                                   63
Credit Quality Classification. The following table analyses Sberbank’s gross loan portfolio (excluding
loans to banks) by credit quality classification as of December 31, 2005 and 2004.
                                                                                                                              As of December 31,
                                                                                                                       2005                       2004
                                                                                                                                               (restated)
                                                                                                          thousands of                    thousands of
                                                                                                             RUR                  %          RUR             %
Current loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             1,856,803,176            98.7   1,357,637,562       98.6
Overdue loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  19,723,473             1.1      19,727,722        1.4
Reverse sale and repurchase agreements. . . . . . . . . . . . . . . .                                       3,839,710             0.2              —          —
Total loans, gross . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                1,880,366,359             100   1,377,365,284        100

Maturity. The following table analyses Sberbank’s loan portfolio, (excluding loans to banks) by maturity
as of December 31, 2005 and 2004.
                                                                                                                                    As of December 31,
                                                                                                                                 2005                 2004
                                                                                                                                                   (restated)
                                                                                                                                     thousands of RUR
On demand and less than one month . . . . . . . . . . . . . . . . . . . . . . . . . .                                       111,181,990              118,025,607
One to six months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                     459,910,604              335,740,039
Six to 12 months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    404,487,996              312,370,780
More than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      811,707,634              531,869,811
Total(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      1,787,288,224            1,298,006,237


(1)    Including provision for loan impairment.

Although the share of long-term loans in Sberbank’s loan portfolio is increasing, short-term loans still
predominate, as is customary in the Russian domestic lending market. In 2005, loans with maturities of
over one year showed a substantial growth. In absolute terms, the growth of this category of loans
amounted to RUR279.8 billion. Sberbank expects that as the Russian economy becomes more stable, the
‘‘more than one year’’ loan category will continue to grow.

Currency. The following table analyses Sberbank’s loan portfolio, net of allowances for loan impairment
(excluding loans to banks), by currency as of December 31, 2005 and 2004.
                                                                                                                              As of December 31,
                                                                                                                       2005                       2004
                                                                                                                                               (restated)
                                                                                                           thousands of                   thousands of
                                                                                                              RUR                 %          RUR            %
         (1)
RUR       . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,364,240,293 76.3 1,034,419,224 79.7
U.S. dollars(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       397,557,144 22.2   243,896,576 18.8
Other currencies(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              25,490,787  1.5    19,690,437  1.5
Total loans and advances to customers(1) . . . . . . . . . . . . . . . . . 1,787,288,224 100.0 1,298,006,237 100.0


(1)    Including provision for loan impairment.




                                                                                      64
Deposit Portfolio

Client Concentration. The table below analyses concentrations within client deposits by sector as of
December 31, 2005 and 2004.
                                                                                                                                            As of December 31,
                                                                                                                                     2005                           2004
                                                                                                                                                                 (restated)
                                                                                                                            thousands of                  thousands of
                                                                                                                               RUR             %             RUR               %
Individuals . . . . . . . . . . . . . . . . . . . . . . . .     .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   1,514,301,804     73.5       1,199,916,878         72.5
Oil, gas and chemical . . . . . . . . . . . . . . .             .   .   .   .   .   .   .   .   .   .   .   .   .   .   .     108,919,249      5.2         108,619,166          6.6
Services . . . . . . . . . . . . . . . . . . . . . . . . . .    .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      97,464,516      4.7          63,966,872          3.9
Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      75,710,040      3.7          54,483,794          3.3
Municipal bodies and state organisations                        .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      61,454,531      3.0          36,254,775          2.2
Construction . . . . . . . . . . . . . . . . . . . . . .        .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      31,960,408      1.6          23,736,721          1.4
Food and agriculture . . . . . . . . . . . . . . . .            .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      28,146,079      1.3          21,277,570          1.3
Metallurgy . . . . . . . . . . . . . . . . . . . . . . . .      .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      25,257,585      1.2          34,792,105          2.1
Machine building . . . . . . . . . . . . . . . . . . .          .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      23,758,833      1.2          17,436,191          1.0
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .      94,134,722      4.6          93,817,618          5.7
Total deposits from individuals and customer accounts . . . . .                                                             2,061,107,767    100.0       1,654,301,690        100.0

Client accounts include deposits of RUR33.1 billion in 2005 and RUR25.2 billion in 2004, held as
collateral for irrevocable commitments under import letters of credit.

Maturity. The following table sets out Sberbank’s deposits and debt securities in issue by maturity as of
December 31, 2005 and 2004.
                                                                                                                                                      As of December 31,
                                                                                                                                                   2005                 2004
                                                                                                                                                                     (restated)
                                                                                                                                                       thousands of RUR
Customer accounts
On demand and less than one month . . . . . . . . . . . . . . . . . . . . . . . . . . .                                                      411,413,702            371,814,950
One to six months. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      74,490,290             49,626,318
Six to 12 months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                    35,648,761              8,353,153
More than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                        25,253,210             24,590,391
No stated maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                              —                      —
Total customer accounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                         546,805,963            454,384,812

Deposits from individuals
On demand and less than one month . . . . . . . . . . . . . . . . . . . . . . . . . .                                                         257,084,939           241,643,480
One to six months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                       343,493,666           378,495,362
Six to 12 months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      286,604,122           193,638,223
More than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                        627,119,077           386,139,813
No stated maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                               —                     —
Total deposits from individuals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                            1,514,301,804         1,199,916,878

Debt securities in issue
On demand and less than one month . . . . . . . . . . . . . . . . . . . . . . . . . . .                                                       57,479,390             46,495,606
One to six months. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      12,210,122             13,031,764
Six to 12 months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                    15,695,633              3,038,812
More than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                         1,504,383                747,030
No stated maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                              —                      —
Total debt securities in issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                          86,889,528             63,313,212




                                                                                                            65
Securities Portfolio

The following tables set forth the maturities of Sberbank’s securities portfolio category as of
December 31, 2005 and 2004.
                                                                                              As of December 31, 2005
                                                                    Demand and
                                                                    less than one       From one to From six to More than
                                                                        month            six months 12 months      one year     Total
                                                                                                  thousands of RUR
Trading securities . . . . . . . . . . . . . . . . . . . . . . . 131,815,427                  —            —              — 131,815,427
Other securities at fair value through profit
  or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227,280,891           —            —            — 227,280,891
Investment securities available for sale . . . .                                 —            —            —            —          —
Investment securities held to maturity . . . . .                                 —            —            —    28,398,916 28,398,916
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359,096,318         —            —    28,398,916 387,495,234

                                                                                              As of December 31, 2004
                                                                                                     (restated)
                                                                    Demand and
                                                                    less than one From one to From six to More than
                                                                        month      six months 12 months      one year           Total
                                                                                             thousands of RUR
Trading securities . . . . . . . . . . . . . . . . . . . . . . . 117,036,694                  —            —              — 117,036,694
Other securities at fair value through profit
  or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215,569,169           —           —             — 215,569,169
Investment securities held to maturity . . . . .                                 —            —           —     35,650,135 35,650,135
Investment securities available for sale . . . . .                               —            —      112,296            —     112,296
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 332,605,863         —      112,296    35,650,135 368,368,294


Maturities of Client Deposits/Interest-Bearing Liabilities

The following tables set forth the maturities of Sberbank’s client deposits and interest-bearing liabilities
as of December 31, 2005 and 2004. See ‘‘Risk Factors—Risks Relating to Sberbank’s Business and
Industry—Sberbank cannot completely eliminate liquidity risk.’’
                                                                                          As of December 31, 2005
                                                        Demand and
                                                        less than one       From one to        From six to    More than
                                                            month            six months         12 months     one year         Total
                                                                                             thousands of RUR
Due to banks . . . . . . . . . . . . . . . . . . . 23,440,572 1,471,688          —           —     24,912,260
Deposits from individuals . . . . . . . . 257,084,939 343,493,666 286,604,122 627,119,077 1,514,301,804
Customer accounts . . . . . . . . . . . . . . 411,413,702 74,490,290 35,648,761 25,253,210        546,805,963
Debt securities in issue . . . . . . . . . . 57,479,390 12,210,122 15,695,633         1,504,383    86,889,528
Other borrowed funds . . . . . . . . . . .                 —    887,912          — 62,075,953      62,963,865
Subordinated debt . . . . . . . . . . . . . . .            —         —           — 29,393,050      29,393,050
Total client deposits/interest-
  bearing liabilities . . . . . . . . . . . . . 749,418,603 432,553,678 337,948,516 745,345,673 2,265,266,470




                                                                           66
                                                                                      As of December 31, 2004
                                                                                             (restated)
                                                      Demand and
                                                      less than one      From one to        From six to    More than
                                                          month           six months         12 months     one year           Total
                                                                                          thousands of RUR
Due to banks . . . . . . . . . . . . . . . . . . . 12,949,575        —           —           —     12,949,575
Deposits from individuals . . . . . . . . 241,643,480 378,495,362 193,638,223 386,139,813 1,199,916,878
Customer accounts . . . . . . . . . . . . . . 371,814,950 49,626,318      8,353,153 24,590,391    454,384,812
Debt securities in issue . . . . . . . . . . 46,495,606 13,031,764        3,038,812     747,030    63,313,212
Other borrowed funds . . . . . . . . . . . 27,781,693         1,981,629          —           —     29,763,322
Total client deposits/interest-
  bearing liabilities . . . . . . . . . . . . . 700,685,304 443,135,073 205,030,188 411,477,234 1,760,327,799

Dividends
The following table sets forth Sberbank’s dividends for the years ended December 31, 2005 and 2004.
                                                                                                              Year ended December 31,
                                                                                                               2005             2004
                                                                                                                             (restated)
Declared cash dividends (thousands of RUR) . . . . . . . . . . . . . . . . . . . . . . . .                   3,304,100       2,555,588
Dividend payout ratio (%)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       5.0%           14.1%

(1)   Calculated as the dividends declared divided by profit for the year.

Capital Adequacy
In 2005 and 2004, Sberbank’s capital adequacy indicators exceeded the requirements of the Bank for
International Settlements and the CBR.
The following table sets forth Sberbank’s capitalisation as of December 31, 2005 and 2004, in accordance
with the Basle Accord, a paper entitled ‘‘International Convergence of Capital Measurement and Capital
Standards,’’ dated July 1988 and prepared by the Basle Committee on Banking Regulation and
Supervision, as amended.
                                                                                                                  As of December 31,
                                                                                                                2005             2004
                                                                                                                              (restated)
Core capital adequacy ratio (Tier 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          10.3%            10.1%
Total capital adequacy ratio (Tier 1 and Tier 2) . . . . . . . . . . . . . . . . . . . . . . .                  12.5%            10.1%




                                                                        67
                                                                                                                    MANAGEMENT

     Organisational Structure of Sberbank’s Central Head Office
     as of March 1, 2006

                                                                                                                 Chairman of the
                                                                                                                 Board and Chief
                                                                                                                 Executive Officer
                                                                                                                 Andrei I. Kazmin




              First Deputy           Deputy                Deputy                               Deputy                                                    Deputy Chairman of
                                  Chairman of the                                                                                                                              Deputy Chairman   Deputy Chairman      Deputy Chairman        Deputy Chairman of
            Chairman of the                           Chairman of the                       Chairman of the                          Deputy Chairman       Deputy Chairman
                                                                                                                                                              the Board
                                      Board                                                                                                                                      of the Board       of the Board        of the Board             the Board
                 Board                                     Board                                 Board                                 of the Board       Evgeny A.Board
                                                                                                                                                             of the K orolev
                                   Alexander V.                                                                                                                                 Alexander N.         Director of      Chairman of the         Chairman of the
           Alla K. Aleshkina                           Bella I. Zlatkis                      Alexander V.                            Evgeny A. Korolev    Andrei E. Pogodin
                                     Brynza                                                   Zakharov                                                                           Govorunov       Internal Control,        Board of                Board of
                                                                                                                                                                                                   Revisions and        Srednerussky            Tsern ozemny
                                                                                                                                                                                                 Audit Department      Regional Head           Regional Head
                                                                                                                                                                                                 Andrei F. Manoilo          Office                  Office
               Finance             Accounting                              Financial       For eign Cu rren cy   Risk Management     Branch Network                                                                      Vladimir A.           Aleksander K.
                                                          Treasury                                                                                           Bank Cards        Cash Collection
              Department           Department                              Markets              and Non-            Department        Management                                                                          Nikonov                 Solovyev
                                                                                                                                                             Department          Department      In ternal Control,
                                                                          Department         Commercial                                Departmen t
                                                                                              Operations                                                                                           Revisions and
                                                                                             Department                                                                                                 Audit
           Str ategic Planning   Account ing and         Depositary                                                Operations                                                                                            Management of Regional Head Offices of
                                                                             Capital                                                   Deposit s and                                               Department (2)
                Department         Con trol for       (has Department                                              Department                               Bank Systems       Administrative                                          Sber bank
                                                                            Markets                                                     Settlement
                                    Banking                status)                                                                                           Department         Department
                                   Ope rations                             Department      Mai n Settlement                            Departmen t
                                                                                                Center
             Tax Planning                                                                  (has Department       Legal Department
              Department                                 Securi ties      Resou rces and        status)                              Cash and Valuables         IT and           Property
                                  Account ing and                                                                                                         Telecommunications
68




                                                        Department          Liquidit y                                                  Department                              Management
                                 Control for Retail                                                                                                            Systems
                                                                             Division                            Public Relat ions                                              Department
                                    Operations                                                                                                                Department
                                   Department                                                 International        Department
           Credit Department                                                                    Relations
                                                                             Analytic          Department                              Administrative
                                                                                                                                        Department          Department of      Bank Secur ity
                                                                              Sector                                Personnel
            Credit Department
                                     Banki ng                                                                                                              Introduction and    Department (1)
           Engineering Credit      Technologies                                                                    Department                               Mai nten ance of
            Strategic Planning
              Department           Department                                                                                                                 Automated
               Department
                                                                             Client                                                                             Systems
                                                                            Relations                               Secretariat
            Project Finance                                                 Division
              Department
                                                                                                                  Bank Securi ty
                                                                                                                  Department (1 )
             Construction
            Project Finance
              Department                                                                                         Internal Control,
                                                                                                                  Revisions and
                                                                                                                       Audit
            Retail Lending                                                                                         Department (2)
             Department


           Corporate Banking
              Department



     (1)     The Bank Security Department is supervised by the Chief Executive Officer of Sberbank and a Deputy Chairman of the Board.
     (2)     The Internal Control, Revisions and Audit Department is supervised by the Chief Executive Officer of Sberbank.
Governance Bodies
In accordance with the Russian legislation governing joint stock companies and Sberbank’s charter, its
principal governance bodies are the shareholders’ meeting, the supervisory board (the ‘‘Supervisory
Board’’), the executive board (the ‘‘Board’’) and the Chief Executive Officer (Chairman of the Board).
Shareholders’ Meeting
The shareholders’ meeting is Sberbank’s highest governance body. It meets when called by the
Supervisory Board, but at least once a year. The following matters can only be dealt with by the
shareholders’ meeting:
•   alteration of Sberbank’s charter, the size and composition of its authorised capital (with certain
    exceptions);
•   election and early termination of the members of Sberbank’s Supervisory Board and the Chief
    Executive Officer (Chairman of the Board);
•   Sberbank’s reorganisation or liquidation;
•   approval of certain major transactions;
•   approval of Sberbank’s auditor;
•   approval of issuance of bonds and other securities where such approval is required by law or
    Sberbank’s charter;
•   approval of dividends; and
•   certain other matters provided for by law and Sberbank’s charter.
Supervisory Board
The Supervisory Board carries out Sberbank’s general management with the exception of matters that are
designated by Sberbank’s charter as being the exclusive responsibility of the general shareholders’
meeting. Members of the Supervisory Board are elected at the general shareholders’ meeting for the
terms up to the following annual general shareholder’s meeting. The Supervisory Board is headed by the
Chairman elected by the members of the Supervisory Board. Persons elected as the members of the
Supervisory Board may be re-elected without limitation. The Supervisory Board meets at least quarterly.
Decisions of the Supervisory Board are made by simple majority, provided that there is a quorum (at least
half of the members either attend in person or submit their views in writing one day prior to a meeting
of the Supervisory Board).
The name, age, qualifications and certain other information for each member of the Supervisory Board
is set out below:
Sergei M. Ignatiev (58) has been the Chairman of the Supervisory Board since June 21, 2002 and a
member of the Supervisory Board since June 30, 2000. Since March 20, 2002, Mr. Ignatiev has been the
Chairman of the CBR. From October 1, 2000 through March 20, 2002, he was the First Deputy Minister
of Finance of Russia. Mr. Ignatiev graduated from the Economics department of Moscow State University
in 1975 and has a Ph.D. in Economics.
Alexei V. Ulyukaev (50) has served as a member of the Supervisory Board since June 30, 2000. In
April 2004, Mr. Ulyukaev became the First Deputy Chairman of the CBR and in May 2004, a member
of its Board of Directors. Since November 29, 2002, he has served as a member of the supervisory council
of JSC Vneshtorgbank. From October 2000 through April 8, 2004, Mr. Ulyukaev was the First Deputy
Minister of Finance of Russia. Mr. Ulyukaev graduated from the Moscow State University with
specialisation in Political Economy. He has a Ph.D. in Economics.
Georgy I. Luntovsky (56) has served as a member of the Supervisory Board since June 30, 2000. From
October 1, 2000 through March 15, 2005, Mr. Luntovsky was the Deputy Chairman of the CBR. Since
March 16, 2005, he has been the First Deputy Chairman of the CBR. Mr. Luntovsky graduated from the
All-Soviet Union Finance and Economics Institute in 1978, from the State Enterprise Academy of the
Government of Russia in 1997, and from the Moscow State University of Economy, Statistics and
Informatics in 1998. He has a Ph.D. in Economics.
Arcady V. Dvorkovich (34) has served as a member of the Supervisory Board since June 27, 2003. Since
November 29, 2002, he has served as a member of the supervisory council of JSC Vneshtorgbank. Since

                                                   69
April 17, 2004, Mr. Dvorkovich has been the head of the Expert Department at the Administration of the
President of Russia. From October 1, 2000 through March 26, 2001, he was the advisor to the Minister at
the Ministry of Economic Development and Trade of Russia. From March 27, 2001 through April 16, 2004,
he was the Deputy Minister of Economic Development and Trade of Russia. Mr. Dvorkovich graduated
from the Economics department of Moscow State University in 1994. He received Master’s degrees in
Economics from the Russian School of Economics in 1994 and from Duke University in 1997.
Boris G. Fedorov (48) has served as a member of the Supervisory Board since June 30, 1999. Mr. Fedorov
is also a member of the boards of directors of Gazprom and OJSC Seventh Continent, a supermarket
chain. Since 1995, Mr. Fedorov has headed the ‘‘Russia, Ahead!’’ political movement. Mr. Fedorov
graduated from the Moscow Finance Institute in 1980 with a specialisation in International Economic
Relations. He has a Ph.D. in Economics.
Sergei V. Generalov (43) has served as a member of the Supervisory Board since June 18, 2004. Since
January 5, 2004, he has been the chief executive officer of LLC Promyshlennye Investory, an investment
company. From January 17, 2000 through December 29, 2003, he was a State Duma deputy, the Deputy
Chairman of State Duma Committee on economic policy and business activity and the chairman of State
Duma Commission on protection of investors’ rights. Mr. Generalov graduated from the Moscow Energy
Institute in 1986 with a specialisation in Radio Physics and Electronics, and from the Higher School of
Management of the State Academy of Management in 1993 with a specialisation in Organisation of
Management of Foreign Economic Activity.
German O. Gref (42) has been a member of the Supervisory Board since June 24, 2005. Mr. Gref is also
a member of the board of directors of UES and he has been the Minister of the Economical Development
and Trade of the Russian Federation since May 18, 2000. From August 14, 1998 to May 18, 2000, Mr. Gref
was the Deputy Minister of State Property of the Russian Federation. Since June 24, 2005, Mr. Gref has
been a member of the supervisory board of OJSC Gazprom. He is also a member of the supervisory
boards of OJSC System Operator - Central Dispatching Office for UES and JSC Federal Grid Company
of UES. Mr. Gref is also the chairman of the supervisory board of The Agency for Housing Mortgage
Lending. Mr. Gref graduated from the Omsk State University with a specialisation in Law in 1990.
Nadezhda Yu. Ivanova (53) has served as a member of the Supervisory Board since June 21, 2002. Since
June 1, 1998, she has been the Director of the Consolidated Economic Department of the CBR.
Ms. Ivanova is also a member of the supervisory board of MICEX. Ms. Ivanova graduated from the
Moscow Institute of Finance with a specialisation in Finance and Credit.
Andrei I. Kazmin (47) has been the Chairman of the Board and Chief Executive Officer of Sberbank since
January 24, 1996. He has been a member of the Supervisory Board since January 23, 1996. Mr. Kazmin
is also a vice-president of the World Savings Banks Institute and a member of the boards of directors of
MasterCard Europe and the U.S.-Russia Business Council. Mr. Kazmin graduated from the Moscow
Institute of Finance in 1980 with a specialisation in Finance and Credit, and completed in 1983
postgraduate studies of the Moscow Institute of Finance. He has a Ph.D. in Economics. From 1993
through 1996, he served as the Deputy Minister of Finance of the Russian Federation. In November 2001,
President of Russia Vladimir V. Putin awarded Mr. Kazmin with the Order of Honour for merit in
economics and finance.
Alexei L. Kudrin (46) has been a member of the Supervisory Board since May 30, 1997. Mr. Kudrin also
serves as the chairman of the supervisory councils of ALROSA Company Ltd. and JSC Vneshtorgbank,
He has served as the Minister of Finance of Russia since March 9, 2004. From October 1, 2000 through
March 9, 2004, he was the Deputy Chairman of the Russian government and the Minister of Finance of
the Russian Federation. Mr. Kudrin graduated from the Leningrad State University with a specialisation
in Political Economy and has a Ph.D. in Economics.
Tatyana V. Paramonova (56) has served as a member of the Supervisory Board since June 30, 1999. Since
October 1, 2000, Ms. Paramonova has been the First Deputy Chairman of the CBR. Ms. Paramonova
graduated from the Moscow Institute of State Enterprise in 1972 with a specialisation in Finance and
Credit. She has a Ph.D. in Economics.
Dmitriy Y. Pyatkin (43) has served as a member of the Supervisory Board since June 24, 2005. Mr. Pyatkin
is the advisor to the general director of LLC Expotrade. From February 11, 2005 to July 16, 2005,
Mr. Pyatkin served as the chairman of the board of directors of OJSC Bashkhim, a holding company for
three chemical enterprises and one transportation company. From October 1, 2000 to March 25, 2004,
Mr. Pyatkin was the General Director of LLC Sovlink, an investment company, a financial consultant at

                                                  70
CJSC Arand from December 2, 2002 to August 29, 2003, the general director of LLC Granados, from
September 1, 2003 to February 10, 2005, and the advisor to the general director of LLC Sovlink from
March 26, 2004 to January 21, 2005. Mr. Pyatkin is also the chairman of the supervisory board of OJSC
Bashkhim, a management company in the chemical industry, and he is a member of the supervisory board
of CJSC KPSK. Mr. Pyatkin graduated from the Moscow Institute of Finance in 1986 with a specialisation
in International Economic Relations.
Aleksei L. Savatyugin (36) has been a member of the Supervisory Board since June 24, 2005.
Mr. Savatyugin has been the Director of the Department of the Financial Policy of the Ministry of Finance
of the Russian Federation since June 2004. He was the chairman of the management board of the National
Association of the Participants of the Stock Market of Russia (NAUFOR) from 2002 to 2004. In 2002,
Mr. Savatyugin was the chief economist of the RTS Stock Exchange, and from 2000 to 2002, he was the
General Director of LLC Index Agency RTS−Interfax. Mr. Savatyugin is a member of the supervisory
boards of the Russian State Insurance Company and The Agency for Housing Mortgage Lending. He is
also a member of the supervisory board of the Russian Agricultural Bank. Mr. Savatyugin graduated from
the St. Petersburg State University in 1992 with a specialisation in Political Economy.
Konstantin B. Shor (58) has served as a member of the Supervisory Board since June 27, 2003. Since
October 19, 2000, Mr. Shor has been the Head of the Moscow Head Territorial Department of the CBR.
Mr. Shor graduated from the Moscow Institute of Finance in 1973 with a specialisation in Finance and
Credit.
Valery V. Tkachenko (51) has served as a member of the Supervisory Board since June 27, 2003. Since
February 20, 2003, Mr. Tkachenko has been the Chief Auditor of the CBR. From January 28, 2002
through February 18, 2003, he was the first vice-president of National Reserve Bank. From October 1, 2000
to January 24, 2002, he served as the Director of Inspection of the Credit Organisation Department of the
CBR.
Bella I. Zlatkis (57) has served as a member of the Supervisory Board since January 23, 1996. Since
May 28, 2004, Ms. Zlatkis has been the Deputy Chairman of the Board, from July 8, 2005, she has been
a member of Sberbank’s Board. From August 11, 1998 through August 25, 2000, she served as the Head
of the Internal State Debt Department at the Ministry of Finance of the Russian Federation, from
August 28, 2000 through May 27, 2004, she was the Deputy Minister of Finance of the Russian Federation.
Since 2005, Ms. Zlatkis has been the member of the supervisory board of MICEX. Ms. Zlatkis graduated
from the Moscow Institute of Finance in 1970 with a specialisation in Finance and Credit. She has a Ph.D.
in Economics.
The business address of Mr. Gref is 1, 3, 1st Tverskaya-Yamskaya Street, 125818 Moscow, Russian
Federation. The business address of Mr. Kudrin and Mr. Savatyugin is 9 Ilyinka Street, 109097 Moscow,
Russian Federation. The business address of Mr. Shor, Mr. Tkachenko, Mr. Luntovsky, Mr. Ignatiev,
Mr. Ulyukaev, Ms. Ivanova and Ms. Paramonova is 12 Neglinnaya Street, 107016 Moscow, Russian
Federation. The business address of Mr. Kazmin and Ms. Zlatkis is 16 Vavilova Street, 117997 Moscow,
Russian Federation. The business address of Mr. Dvorkovich is 4 Staraya Square 103132 Moscow, Russian
Federation. The business address of Mr. Pyatkin is 7, 38 Bolshaya Pochtovaya Street, 107082 Moscow,
Russian Federation. The business address of Mr. Generalov is 44 Bolshaya Ordynka Street, 119017
Moscow, Russian Federation. The business address of Mr. Fedorov is 16 Nametkina Street, 117997
Moscow, Russian Federation.
Except as set forth in ‘‘Management,’’ Sberbank is not aware of any conflicts of interest between the duties
that any member of the Supervisory Board owes to Sberbank and their member’s private interests or
other duties.

The Board
The Board is Sberbank’s collegial executive body and is appointed by the Supervisory Board. Members
of the Board may be appointed without limitation. The Board usually meets two or three times per month
and makes its decisions by a simple majority, provided that there is a quorum (at least half of its members
are present). The Board carries out Sberbank’s management and administration. The Chairman of the
Board represents Sberbank and acts as its Chief Executive Officer.




                                                    71
The name, age, qualifications and certain other information for each member of the Board is set out
below:
Andrei I. Kazmin. See ‘‘—Supervisory Board.’’
Alla K. Aleshkina (46) has served as a member of Sberbank’s Board since April 30, 1996. Since
April 8, 1997, she has been the First Deputy Chairman of the Board of Sberbank. From May 30, 1997 to
June 24, 2004, she was a member of the Supervisory Board. Ms. Aleshkina graduated from the Moscow
Institute of Finance in 1981 with a specialisation in Finance and Credit.
Alexander V. Brynza (35) had been a member of Sberbank’s Board since September 29, 2003. Since
September 1, 2003, he has served as the Deputy Chairman of the Board on September 1, 2003. From
September 2, 1996 through February 28, 2002, he worked at the Moscow office of Arthur Andersen. From
March 6, 2002 through August 29, 2003, he was the vice president of Gazprombank. Mr. Brynza graduated
from the Moscow State Aviation Institute in 1994, and from the Staff Re-Training Institute of the Finance
Academy at the Government of Russia in 1995 with a specialisation in International Economic Relations.
Alexander N. Govorunov (51) has served as a member of Sberbank’s Board since April 15, 2003, and
Deputy Chairman of the Board since May 22, 2000. From March 1 through December 10, 1999, he was
the Director of Security Department of Sberbank’s St. Petersburg Regional Head Office. From
December 14, 1999 through May 21, 2000, he was an Assistant to Sberbank’s Chief Executive Officer.
Mr. Govorunov graduated from the Leningrad Engineering and Economics Institute in 1980 with a
specialisation in Organisation of Mechanised Processing of Economic Information.
Bella I. Zlatkis. See ‘‘—Supervisory Board.’’
Evgeny A. Korolev (47) has been a member of Sberbank’s Board since July 16, 1997, and the Deputy
Chairman of the Board since March 11, 2003. From October 30, 1995 through November 2000, he was the
Chairman of Sberbank’s Nizhegorodsky Regional Head Office. From November 2000 through March 10,
2003, he was the Chairman of Sberbank’s Volgo-Viatsky Regional Head Office. Mr. Korolev graduated
from the Gorky State University in 1981 with a specialisation in Radiophysics and Electronics, and from
All-Russian Distance Finance and Economics Institute in 1995 with a specialisation in Finance and Credit.
Andrei F. Manoilo (49) has been a member of Sberbank’s Board since April 20, 1995. Since
December 17, 2003, Mr. Manoilo has been the Deputy Chairman of the Board and the Director of
Sberbank’s Internal Control, Revisions and Audit Department. From October 10, 1997 through
October 22, 2000, he was the Director of Sberbank’s Treasury. From October 23, 2000 through
December 16, 2003, Mr. Manoilo was the Director of Sberbank’s Financial Department. Mr. Manoilo
graduated from the Moscow Institute of Physics and Engineering in 1979 with a specialisation in Physics
of Solids, and from the Special department of the Moscow Institute of Management in 1987 with a
specialisation in Organisation of Engineering Management.
Vladimir A. Nikonov (53) has served as a member of Sberbank’s Board since July 16, 1997. He has been
the Deputy Chairman of the Board since July 16, 1997. Since November 21, 2000, Mr. Nikonov has been
the Deputy Chairman of the Board and the Chairman of Srednerussky Regional Head Office. From
December 16, 1999 through November 20, 2000, he was the Deputy Chairman of the Board and the
Chairman of Moscow Regional Head Office. Mr. Nikonov graduated from the Moscow Institute of
Finance in 1980 with a specialisation in Finance and Credit.
Andrei E. Pogodin (49) has been a member of Sberbank’s Board since July 16, 1997 and has served as a
Deputy Chairman of the Board since July 17, 1997. Mr. Pogodin is a member of the Supervisory Board
of JSC BGS Smartcard Systems AG, an Austrian company engaged in bank card processing services.
Since 2005, he has also been the Chairman of the Supervisory Board of CJSC Sberkart. Mr. Pogodin
graduated from the Higher School of the Committee of State Security in 1980 with a specialisation in
Communications Equipment.
Alexander K. Solovyev (57) has been a member of Sberbank’s Board since April 20, 1995. He has served
as a Deputy Chairman of the Board and the Chairman of Tsentralno-Chernozemny Regional Head Office
since July 17, 1997. From January 1, 1994 until July 16, 1997, he was the Chairman of Voronezhski
Regional Head Office. Mr. Solovyev graduated from the Voronezh Teacher’s Institute in 1973 with a
specialisation in Physics and from Voronezh Polytechnic Institute in 1982 with a specialisation in
Machine-Building Industry Management and Economics.
Alexander V. Zakharov (51) was appointed Deputy Chairman of the Board on April 25, 2003. From
April 1, 1992 through April 24, 2003, he was the Chief Executive Officer of the Moscow Interbank

                                                   72
Currency Exchange. Mr. Zakharov graduated from the Moscow Plekhanov Institute of State Enterprise
in 1980 and from the Academy of Foreign Trade in 1988 with a specialisation in International Economic
Relations.
Irina N. Bokhan (52) has served as a member of Sberbank’s Board since July 16, 1997. Since May 27, 1996,
Ms. Bokhan has been the Director of Sberbank’s Credit Department. Ms. Bokhan graduated from the
Moscow Institute of State Enterprise in 1976 with a specialisation in Accounting.
Andrei F. Golikov (37) has served as a member of Sberbank’s Board since November 30, 2004. Since
September 27, 2005, he has been the Director of Sberbank’s Treasury. Mr. Golikov has worked at
Sberbank in various positions since 1996. Since 2003, Mr. Golikov has been a member of the supervisory
board of MICEX. He graduated from the Moscow State University in 1991 with a specialisation in
Mechanics.
Viktor V. Gavrilov (68) has served as a member of the Board since July 16, 1997. Since November
21, 2000, he has been the Chairman of Sberbank’s Severo-Kavkazsky Regional Head Office. From
April 1, 1991 until November 20, 2000, Mr. Gavrilov was the Chairman of Sberbank’s Stavropolskiy
Regional Head Office. Mr. Gavrilov graduated from the Rostov Institute of State Enterprise in 1965 with
a specialisation in Finance and Credit.
Andrei V. Kruzhalov (41) has served as a member of Sberbank’s Board since July 16, 1997. Since
October 1, 1996, Mr. Kruzhalov has been Sberbank’s Chief Accountant and the Director of Accounting
Department. Mr. Kruzhalov graduated from the Moscow Institute of Economics and Statistics in 1989
with a specialisation in Organisation of Mechanised Processing of Economic Information, and from
Russian Economic Academy in 2004 with a specialisation in Finance and Credit.
Nikolai I. Kuleshov (49) has served as a member of Sberbank’s Board since December 18, 1996. Since
July 2, 2002, Mr. Kuleshov has been the Director of Sberbank’s Corporate Clients Department. From
July 1, 1998 through January 2, 2001, Mr. Kuleshov was the Deputy Director of Sberbank’s Treasury and
the Director of the Financial Market Operations Department, and from January 3, 2001 through
July 1, 2002, he was the Director of the Currency Market Operations of Sberbank’s Treasury.
Mr. Kuleshov graduated from the Moscow Institute of Aviation Technology in 1978 with a specialisation
in Aircraft Engines, and from the All-Union Moscow Distance Juridical Institute in 1990 with a
specialisation in Jurisprudence.
Vladimir F. Pesotski (66) has served as a member of Sberbank’s Board since July 16, 1997. Since
September 18, 1991, Mr. Pesotski has been the Chairman of Sberbank’s Altaisky Regional Head Office.
Mr. Pesotski graduated from the Altai Polytechnic Institute in 1968 with a specialisation in Civil
Engineering.
Galina A. Rybakova (49) has served as a member of Sberbank’s Board since October 11, 1991. Since
October 26, 2000, Ms. Rybakova has been the Director of Sberbank’s Branch Network Management
Department. From January 15, 1994 through October 25, 2000, she was the Director of Sberbank’s
Economics Department. Ms. Rybakova graduated from the Moscow Institute of Finance in 1978 with a
specialisation in Finance and Credit and has a Ph.D. in Economics.
Viktor V. Shchurenkov (55) has served as a member of Sberbank’s Board since December 18, 1996. Since
November 21, 2000, Mr. Shchurenkov has been the Chairman of Sberbank’s Povolzhsky Regional Head
Office. From March 3, 1995 through November 20, 2000, Mr. Shchurenkov was the Chairman of
Sberbank’s Samarsky Regional Head Office. Since 2004, Mr. Shchurenkov has been a member of the
Supervisory Board of CJSC Sberbankinveststroi. Mr. Shchurenkov graduated from the Kuibyshev
Polytechnic Institute in 1976 with a specialisation in Automation and Telemechanics, and from the
Samara State Economic Academy in 1997 with a specialisation in Finance and Credit.
Vladimir B. Sundeev (44) has served as a member of Sberbank’s Board since July 16, 1997. Since
September 30, 1996, Mr. Sundeev has been the Director of Sberbank’s Operations Department.
Mr. Sundeev graduated from the Leningrad Navy Higher Engineering College in 1984 with a specialisation
in Meteorology, and from the Staff Re-Training Institute of the Finance Academy of the Government of
the Russian Federation in 1997 with a specialisation in Banking.
Leonid M. Syukasev (52) has served as a member of Sberbank’s Board since November 30, 2004. Since
March 31, 1995, he has been the Director of Sberbank’s Legal Department. From July 6, 1993 through
March 30, 1995, Mr. Syukasev was the Director of Sberbank’s Cash and Valuables Department. He
graduated from the Sverdlovsk Law Institute in 1974 with a specialisation in Jurisprudence.

                                                  73
The business address of each member of Sberbank’s Board is 19 Vavilova Street, 117997 Moscow, Russian
Federation.
Except as set forth in ‘‘Management,’’ Sberbank is not aware of any conflicts of interest between the duties
that any member of the Board owes to Sberbank and such member’s private interests or other duties.

Certain Transactions
As of December 31, 2005, Sberbank had outstanding loans to members of its Board in the amount of
RUR28.8 million.

Share Ownership
As of December 31, 2005, Sberbank’s senior management, directors of departments and personnel held,
in the aggregate, 1.32% of Sberbank’s share capital.




                                                    74
             TRANSACTIONS WITH RELATED PARTIES AND STATE-OWNED ENTITIES

Related Party Transactions
Sberbank enters into banking transactions in the normal course of business with shareholders, directors,
subsidiaries and companies with which it has significant shareholders in common. Sberbank also maintains
a number of balances and conducts a range of transactions with the CBR, its majority shareholder. These
transactions include settlements, deposit placement and the taking and transfer of funds to the mandatory
cash balances, in accordance with the Russian banking regulations. These transactions include settlements,
loans, deposit taking, trade financing and foreign currency transactions. Transactions with related parties
are priced predominantly at market rates.
As of December 31, 2005 and 2004, Sberbank’s outstanding balances with related parties (including CBR
and excluding operations with state-controlled entities and government bodies) were as follows:

                                                                                            As of December 31,
                                                                              2005                                   2004
                                                                                                                  (restated)
                                                                                 Other related
                                                                   CBR              parties            CBR              Other related parties
                                                                                            thousands of RUR
Assets
Account with the CBR (other than
  mandatory cash balances) . . . . . . . . .                    26,946,095                   —       41,667,705                       —
Discount debt securities (contractual
  interest rate: 0%) . . . . . . . . . . . . . . . .            24,461,159                   —          904,534                           —
Due from other banks (contractual
  interest rate: 4%-5%) . . . . . . . . . . . . .                3,497,680                   —        3,760,936                           —
Gross amount of loans and advances
  to customers (contractual interest
  rate: 11%-14%) . . . . . . . . . . . . . . . . . .                     —           17,717,472               —                 12,746,217
Impairment provisions for loans and
  advances to customers . . . . . . . . . . .                            —            (479,517)               —                   (635,252)
Other assets . . . . . . . . . . . . . . . . . . . . . . .               —              10,322                —                      5,010
Liabilities
Customer accounts (contractual
  interest rate: 5%-6%) . . . . . . . . . . . . .                        —             502,566                —                    909,559
Credit related commitments
Import letters of credit at the year
  end . . . . . . . . . . . . . . . . . . . . . . . . . . . .            —             359,404                —                      82,249
Guarantees issued by Sberbank at
  year end . . . . . . . . . . . . . . . . . . . . . . . .               —                   —                —                      60,000
The following table shows income and expenses resulting from related party transactions for the years
ended December 31, 2005 and 2004.
                                                                                      For the year ended December 31,
                                                                               2005                                    2004
                                                                                                                    (restated)
                                                                  CBR         Other related parties      CBR          Other related parties
                                                                                            thousands of RUR
Interest income . . . . . . . . . . . . . . . . . . . .          722,902                1,905,071      2,357,852                   267,098
Interest expense . . . . . . . . . . . . . . . . . . .          (126,484)                 (19,871)      (119,965)                  (10,542)
Other operating income . . . . . . . . . . . .                       362                   98,064             29                   743,118
Other operating expenses . . . . . . . . . . .                  (216,438)                (113,030)      (181,240)                  (68,623)

Transactions with State-Owned Entities
Effective on and after January 1, 2005, state-controlled entities are no longer exempt from disclosing
transactions with other state-controlled entities. Since Sberbank is controlled by the state, all state-owned
entities are considered its related parties. As the Russian government does not provide to the public or
to entities under its ownership/control a complete list of the state controlling, or having significant

                                                                         75
influence over, a client, Sberbank discloses information that its current internal management accounting
system allows to present in relation to operations with state-controlled entities and where it believes such
entities could be considered as state-controlled based on its best knowledge. Sberbank discloses the
outstanding material balances and transactions with government bodies and entities where the state
directly owns more than 50% of the share capital. Sberbank believes that, unless the state has direct
control over a client, it is not practicable to determine whether the state has a related party relationship
with that client. With respect to state-controlled entities, Sberbank analysed its transactions with its 260
largest customers and extracted balances and results of operations for the following groups of entities,
which were included in the tables below: 100% state-owned entities and government bodies and legal
entities where the state controls over 50% of share capital.
Transactions with government bodies and state-controlled entities are entered into the normal course of
business and are priced at market rates. At December 31, 2005 and 2004, the outstanding balances with
state-controlled entities and government bodies were as follows:
                                                                                                     As of December 31,
                                                                                       2005                                   2004
                                                                                                                           (restated)
                                                                       100% state-                              100% state-
                                                                      owned entities       Entities where     owned entities       Entities where
                                                                          and            the state controls        and           the state controls
                                                                       government           over 50% of         government          over 50% of
                                                                         bodies             share capital         bodies            share capital
                                                                                                    thousands of RUR
Cash and cash equivalents . . . . . . . . . . . . .                            —                 3,260,632                —               264,395
Due from other banks . . . . . . . . . . . . . . . .                           —                   240,031                —                    —
Trading securities . . . . . . . . . . . . . . . . . . . .            101,236,063                3,378,605       109,920,610            2,886,242
Other securities at fair value through
  profit and loss . . . . . . . . . . . . . . . . . . . . .            210,925,430               10,716,318       203,548,607            5,326,257
Gross amount of loans and advances to
  customers . . . . . . . . . . . . . . . . . . . . . . . . .          84,131,924               24,178,213        75,553,549           29,133,274
Impairment provisions for loans and
  advances to customers . . . . . . . . . . . . . .                    (1,053,924)                (795,840)       (1,557,382)         (2,050,259)
Investment securities available for sale . .                                   —                        —            112,296                  —
Repurchase receivable . . . . . . . . . . . . . . . .                   1,658,705                       —                 —                   —
Investment securities held to maturity . .                             28,298,916                       —         35,650,135                  —
Customer accounts . . . . . . . . . . . . . . . . . . .                69,536,771              121,225,393        50,762,247         132,833,568
The following table shows income and expenses resulting from transactions with state-owned entities for
the years ended December 31, 2005 and 2004:
                                                                                                     As of December 31,
                                                                                       2005                                      2004
                                                                                                                             (restated)
                                                                       100% state-            Entities where                          Entities where
                                                                      owned entities            the state          100% state-          the state
                                                                          and                 controls over       owned entities      controls over
                                                                       government             50% of share       and government       50% of share
                                                                         bodies                  capital             bodies              capital
                                                                                                       thousands of RUR
Interest income . . . . . . . . . . . . . . . . . . . . . .             38,326,198               3,014,262          27,544,268          2,937,052
Interest expense. . . . . . . . . . . . . . . . . . . . . .               (938,280)             (1,635,730)           (600,877)        (1,572,362)
Gains less losses arising from trading
  securities and other securities at fair
  value through profit or loss . . . . . . . . . .                       12,448,247                 334,595          13,126,502            341,856
Gains less losses arising from
  investment securities available for
  sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           4,709                      —           2,830,446                   —
Gains less losses arising from
  investment securities held to maturity.                                4,180,969                      —                   —                  —
Fee and commission income . . . . . . . . . . .                          2,711,483                 779,238           1,200,180            462,787




                                                                              76
                                                          PRINCIPAL SHAREHOLDERS
As of December 31, 2005, Sberbank’s share capital was RUR1 billion, comprised of 19.0 million ordinary
shares with a par value of RUR50.00 each and 50.0 million preference shares with a par value of RUR1.00
each. As of December 31, 2005, 19.0 million of Sberbank’s ordinary shares and 50.0 million of its
preference shares were issued and outstanding. In addition, as of December 31, 2005 Sberbank had
10.0 million of authorised, but unissued, shares.
Sberbank has held annual shareholders’ meetings since 1991.
The following table lists Sberbank’s shareholders of record, as indicated on the share register and
depositary data of the CBR, as of March 1, 2006, that held 1% or more of its outstanding shares (ordinary
and preference). Sberbank believes that the remaining shares are held by minority investors.

                                                                                                                                                % of total shares
                                                                                                                                              capital (ordinary and
                                                                                                                                               preference shares)


CBR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  60.57
CJSC Depositary-Clearing Company(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                              6.02
ING Bank Eurasia ZAO(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      4.68
National Depositary Centre(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                     4.38
ZAO Citibank(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                            3.92
OJSC GNK Nafta-Moscow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                        3.83
JPMorgan Bank International CJSC (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                               2.65
Deutsche Bank LLC(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                 2.46
Sberbank(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      2.41
OJSC Eurocement Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      1.68
CJSC New Project. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                              1.19
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 93.79


(1)    Nominee holder.




                                                                                      77
              THE BANKING SECTOR AND BANKING REGULATION IN RUSSIA

The Russian Banking Sector
The Russian banking sector consists of the CBR, credit organisations (banks and non-bank credit
organisations) and representative offices of foreign banks. As of March 1, 2006, 1,244 credit organisations
were operating in Russia. A majority (663 as of March 1, 2006) of operating Russian credit organisations
are located in Moscow and the Moscow region. Currently, there are no branches of foreign banks in
Russia.
According to the CBR (based on RAR financial statements), as of March 1, 2006, total assets of Russian
credit organisations were RUR10.1 trillion. Loans, deposits and similar instruments comprised 65.8%
(RUR6.6 trillion) of all assets of credit organisations (overdue loans inclusive), including 43.3%
(RUR4.4 trillion) of loans to the non-financial sector and 7.9% (RUR0.8 trillion) of loans to and deposits
with banks (overdue loans exclusive). Overdue loans, deposits and similar instruments accounted for
approximately 0.9% of all banking assets. Investments in securities by credit organisations represented
17.0% (RUR1.7 trillion), including 4.8% (RUR0.5 trillion) in debt securities of the Russian Federation, of
total assets of Russian credit organisations.
According to the CBR (based on RAR financial statements), as of March 1, 2006, the total liabilities of
Russian credit organisations amounted to RUR10.1 trillion, including interbank deposits comprising
10.9% (RUR1.1 trillion) and debt securities comprising 7.7% (RUR0.8 trillion) of the total liabilities of
Russian credit organisations, while client funds accounted for 58.6% (RUR5.9 trillion) of the total
liabilities of Russian credit organisations.
According to the CBR, as of March 1, 2006, 1,082 operating credit organisations were profitable (under
RAR), while 162 were not.

Legislative Framework for the Russian Banking Sector
The main laws regulating the Russian banking sector are the Banking Law and the CBR Law. Among
other things, they define credit organisations, set out the list of banking operations and other transactions
that may be performed by credit organisations and establish the framework for the registration and
licensing of credit organisations and the regulation of banking activity by the CBR.

Credit Organisations and Their Operations
Banks provide a wide range of banking services while non-bank credit organisations conduct only a
limited number of banking operations, such as maintaining accounts and processing payments on behalf
of various companies. The activities of representative offices of foreign banks are generally limited to
facilitating the banking operations and representing the interests of their parent banks. Under the
Banking Law, a credit organisation can be created in the form of a joint stock company, a limited liability
company or a company with additional liability, although in practice the latter form is not used. Applicants
may be incorporated either inside or outside Russia, although, foreign applicants are subject to stricter
requirements. An application for state registration of a new bank needs to be accompanied by a feasibility
report regarding the future business activity of the credit organisation, detailed information on the
suitability of its management and certain other information. A credit organisation’s application for a CBR
licence may be rejected if the submitted documents do not comply with the requirements set forth in the
Banking Law and the CBR’s regulations, the financial or banking records of the founders of a credit
organisation are unsatisfactory, the proposed candidates for the executive and chief accountant positions
do not meet qualification requirements and for certain other reasons. A detailed procedure for
registration of, and issuance licences to, credit organisations is established in the CBR Regulation
No. 109-I of January 14, 2004.
The Banking Law authorises Russian credit organisations to incorporate subsidiaries and open branches
outside Russia with prior approval of the CBR. The opening of a representative office of a Russian credit
organisation outside Russia requires a notification of the CBR.
Acquisitions in the banking sector are subject to specific banking and antimonopoly rules. According to
the Banking Law, the CBR must be notified of an acquisition of more than 5% of the participation interest
in a credit organisation by any individual or a legal entity, or a group of individuals and/or legal entities,
and it must give prior consent to an acquisition of more than 20% of the participation interest in a credit
organisation. In addition, pursuant to the Federal Law No. 117-FZ ‘‘On Protection of Competition in the

                                                     78
Financial Services Market’’ of June 23, 1999, acquisition of more than 10% of assets of, and more than 20%
of the participation interest in, a credit organisation whose charter capital exceeds the amount established
by the government (currently RUR160 million, as per the Government Regulation No. 194 of
March 7, 2000) requires the prior consent of the Federal Antimonopoly Service.
The Banking Law states that the following services are ‘‘banking operations’’ that require receipt of an
appropriate licence from the CBR: taking deposits from individuals and legal entities (both demand and
fixed-term deposits); investing the deposited funds as a principal; opening and maintaining bank accounts
for individuals and legal entities; performing settlements in accordance with the instructions of individuals
and legal entities, including correspondent banks, from/to their bank accounts; cash, cheque, promissory
note, payment document handling services and over-the-counter services provided to individuals and legal
entities; sale and purchase of foreign currency (including banknotes and coins); taking deposits in precious
metals and investing them; issuing bank guarantees; and processing payments in accordance with the
instructions of individuals without opening bank accounts (excluding payments by post).
In addition to banking operations, credit organisations are permitted to give sureties for obligations of
third parties contemplating payment in cash; to take assignments of rights to demand payment in
monetary form; to perform fiduciary management of monetary funds and other assets for individuals and
legal entities; to engage in operations with precious stones and metals (in accordance with the Federal
Law No. 41-FZ ‘‘On Precious Stones and Precious Metals’’ of March 26, 1998 and related legislation); to
lease special premises and safe deposit boxes to individuals and legal entities for document and valuables
storage; to effect leasing operations; to engage in factoring operations; and to provide consulting and
information services. A credit organisation may enter into any other transaction in compliance with the
relevant Russian legislation. Under the Banking Law, a credit organisation cannot engage in manufacturing,
commodities trading (excluding precious metals) or insurance activities.

Retail Banking and Protection of Depositors
The Banking Law provides that a bank may take deposits from individuals only after it has been
registered for two years and admitted to the retail deposit insurance system.
The retail deposits insurance system was established recently. As of January 1, 2006, 931 banks were
admitted into the retail deposits insurance system.
According to the Deposit Insurance Law, participation in the retail deposit insurance system is subject to
the following requirements: (i) the CBR is comfortable that the bank’s financial statements and reporting
are true and accurate; (ii) the bank is in full compliance with the CBR mandatory ratios (capital adequacy,
liquidity, etc.) which are more stringent for the banks participating in the retail deposits insurance system;
(iii) the bank fully complies with the CBR ratios for the assessment of the quality of the bank’s capital and
assets, profitability and liquidity, as well as the CBR’s requirements for the transparency of its ownership
structure, risk management system and internal control; and (iv) the CBR is not conducting any
enforcement actions with respect to the bank, and no grounds for such enforcement actions have arisen
during the CBR’s review of the bank’s application.
The Deposit Insurance Law provided for the creation of the Deposit Insurance Agency that is in charge
of, inter alia, collecting insurance contributions, managing the funds in the mandatory insurance pools,
establishing insurance premiums and monitoring insurance payments. All banks with retail banking
licences are entered into the register of the Deposit Insurance Agency.
Under the Deposit Insurance Law, which came into effect on December 27, 2003, the protection for each
client is limited to RUR100,000 per bank and banks are required to make quarterly payments into a
deposit insurance fund. The insurance payment from the deposit insurance fund will be payable to
depositors if a bank’s licence has been revoked or if the CBR has imposed a moratorium on payments by
the bank. The basis of the deposit insurance contribution is the quarterly average of daily balances of
retail deposits. Standard contribution premiums cannot exceed 0.15% of the contribution basis. In certain
circumstances, the premium can be increased up to 0.3% of the contribution basis, but not for more than
two quarters per every 18 months. When the size of the insurance fund reaches 5% of total retail deposits
of all Russian banks, all succeeding contribution premiums cannot exceed 0.05% of the contribution basis,
and when the size of the insurance fund exceeds 10% of all Russian banks’ retail deposits, no contributions
need to be made, but they resume once the insurance fund falls below the 10% threshold.
In response to the turmoil that the Russian banking sector experienced from April through July 2004, the
Federal Law No. 96-FZ of July 29, 2004 (the ‘‘Uninsured Deposits Law’’) established a protection system

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for retail clients of the banks that did not participate in the retail deposit insurance system. See ‘‘—Brief
History of the Russian Banking Sector.’’ The Uninsured Deposits Law contemplates, among other things,
that the CBR will make payments to the private depositors of insolvent Russian banks if such banks have
not been admitted to the system of the insurance of private deposits prior to their bankruptcy. Under the
Uninsured Deposits Law, the protection for each client is limited to RUR100,000 per bank. Having made
the payment to the private depositor, the CBR assumes its rights against the bank and receives the same
priority in bankruptcy as the private depositor.
The CBR and Its Role
The CBR’s main aim is to protect the rouble against depreciation and maintain its stability. The CBR is
also responsible for the condition and development of the Russian banking system and the regulation of
the banking activity in Russia. The status of the CBR as the banking sector regulator is determined by the
Constitution of Russia and developed by the CBR Law.
The CBR Law endows the CBR with the power to grant licences to, and suspend or revoke licences of,
credit organisations. Under the CBR Regulation No. 109-I of January 14, 2004, a newly-formed credit
organisation may apply for a licence authorising it to perform banking operations (other than acceptance
of retail deposits) in either both roubles and foreign currencies or in roubles only, as well as a licence
authorising to take deposits in, and conduct related operations with, precious metals. Subject to
compliance with applicable requirements, the CBR may extend the credit organisation’s capacity by
issuance of: (1) a licence authorising to take retail deposits in either both roubles and foreign currencies
or in roubles only, and (2) a general licence authorising the performance of all banking operations except
for taking deposits in, and conducting related operations with, precious metals.
The CBR was established on July 13, 1990 as a successor to the Russian Republican Bank or Gosbank of
the Union of Soviet Socialist Republics (‘‘USSR’’) (‘‘Gosbank’’). With the collapse of the USSR in 1991,
the CBR inherited the operational facilities and resources of Gosbank including its subsidiaries and
branches. According to the CBR Law, the government is not liable for the CBR’s obligations, nor is the
CBR liable for the obligations of the government, unless the relevant liability has been undertaken or is
required under other Russian laws. The charter capital and other assets of the CBR are federal property.
The CBR is a separate state authority and is financially independent from the Russian government. Under
the CBR Law, the CBR is generally prohibited from extending loans to the federal government and
regional and municipal governments for the purpose of budget deficit financing and from purchasing state
securities in the primary market.
The CBR consists of the Moscow Head Office, including the Board of Directors, the National Banking
Council (a collegial management body of the CBR that performs certain governing functions, such as
making decisions on maximum capital expenditures of the CBR, distribution of its profits, appointment
of its auditor and approval of its accounting rules and requirements) and central departments. The CBR
also has a number of regional branches in the constitutive subjects of Russia (in some of the Russian
republics, the CBR’s regional branches are called National Banks) and local branches. The Chairman of
the CBR is nominated by the President of Russia and appointed for a fixed term of four years by the State
Duma (the lower chamber of the Russian Parliament).
The Chairman of the CBR can be replaced under the same procedure and has the right to participate in
government (Cabinet) meetings. Of the 12 members of the National Banking Council, two are appointed
by the Federation Council (the upper chamber of the Russian Parliament) from among its members, three
are appointed by the State Duma from among its deputies, three are appointed by the President and three
are appointed by the Russian government. The Chairman of the CBR is an ex officio member of the
National Banking Council.
Under current legislation, the CBR has the following major functions:

Function                                     Summary

Issuing money and regulating its             The CBR is the sole issuer of Russian rouble banknotes and
circulation                                  regulates their circulation. The CBR plans and arranges for
                                             the printing of banknotes and the engraving of coins,
                                             establishes the rules for their transportation and storage and
                                             regulates operations with cash.



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Function                                     Summary

Financing/Monetary policy                    The CBR establishes interest rates for its financings,
                                             refinances credit organisations, performs currency
                                             interventions, establishes reserve requirements for the banks,
                                             sets capital adequacy and similar ratio requirements for
                                             banks, issues its own bonds (which can be offered to credit
                                             organisations only) and trades in the secondary market for
                                             government securities.

Transactions with banks                      The CBR renders decisions on the state registration of banks;
                                             registers securities issued by banks; extends loans to banks;
                                             maintains correspondent accounts of banks in roubles;
                                             purchases and sells Russian state securities, CBR bonds,
                                             certificates of deposit, precious metals and natural gems;
                                             purchases and sells foreign currencies and payment documents
                                             in foreign currencies issued by Russian and foreign banks.
                                             Unless otherwise directly provided by federal laws, the CBR
                                             is not permitted to participate in charter capital of banks.

Implementing the federal budget and          Under the CBR Law, the CBR is prohibited from extending
debt service                                 loans to the government in order to finance the state’s budget
                                             deficit or purchasing state securities in the primary market,
                                             unless a specific exception is created by the federal budget.
                                             However, the CBR acts as a placement agent with respect to
                                             domestic government securities issued by the Ministry of
                                             Finance of Russia, maintains budget accounts and acts as an
                                             agent for servicing of Russia’s domestic state debt.

Exchange control                             The CBR regulates dealing and settlements in roubles,
                                             foreign currency operations in Russia and by Russian
                                             residents abroad, administers Russia’s gold and currency
                                             reserves and establishes the regimes for rouble and foreign
                                             currency accounts of residents and non-residents in Russia.

Licensing                                    The CBR is responsible for issuing, suspending and revoking
                                             banking licences of credit organisations.

Banking control and supervision              The CBR is responsible for monitoring and controlling
                                             banks’ compliance with ratios and reserve requirements that
                                             it sets. See ‘‘—Banking Supervision—Mandatory Economic
                                             Ratios.’’ The CBR imposes administrative sanctions for
                                             violations of banking legislation by credit organisations
                                             operating in Russia. The CBR sets out standards for financial,
                                             accounting and statistical reporting by credit organisations in
                                             Russia. The CBR appoints the temporary administration of
                                             banks that are facing insolvency.
The CBR is authorised to enter into transactions with credit organisations, foreign banks and the
government in order to perform the functions outlined above.
The CBR has a number of supervisory roles (described below). However, other state authorities also
regulate credit organisations in Russia. For instance, the FSFM issues licences to banks acting as brokers,
dealers or custodians in the Russian securities market. Tax authorities supervise tax assessments of banks.
The Federal Anti-Monopoly Service controls mergers of credit organisations and acquisitions of more
than 20% of voting stock in a credit organisation, as well as disposals of more than 10% of a credit
organisation’s assets.




                                                    81
Banking Supervision
Under the CBR Law and the Banking Law, the CBR is authorised to adopt binding regulations
concerning banking and currency operations. The CBR has actively used this power in recent years,
creating a detailed and extensive body of regulations. Some of the principal features of the supervisory
regime governing banks in Russia are set out below.

Mandatory Economic Ratios
The CBR is authorised to introduce various capital adequacy and liquidity requirements applicable to
banks. Such requirements currently exist in the form of the relevant mandatory economic ratios described
in Regulation No. 110-I of the CBR ‘‘On the Banks’ Mandatory Economic Ratios.’’ Set out below is the
system of the mandatory economic ratios that must be observed by the banks on a daily basis and
regularly reported on to the CBR. Unless stated otherwise, all ratios described below are calculated on
the basis of RAR, as formulated under the applicable Russian laws and the CBR regulations.

                                                                            CBR Mandatory Economic
Mandatory Economic Ratios         Description                               Ratio Requirements
Capital adequacy ratio (N1)       This ratio is intended to limit the       Minimum 11% (where a bank’s
                                  risk of a bank’s insolvency and           capital base is below u5 million)
                                  sets requirements for the                 and minimum 10% (where a
                                  minimum size of the bank’s                bank’s capital base is equal or
                                  capital base necessary to cover           more than u5 million). The
                                  credit and market risks. It is            capital adequacy ratio currently
                                  formulated as a ratio of a bank’s         applicable to Sberbank is 10%.
                                  capital base to its risk-weighted
                                  assets.
                                  The risk-weighted assets are
                                  calculated under a formula that
                                  takes into account the bank’s
                                  capital, select categories of assets,
                                  reserves created for possible
                                  losses of those assets, credit risk
                                  on contingent liabilities, credit
                                  risk on forward transactions, as
                                  well as risks relating to interest
                                  rates, securities markets and
                                  currencies,      in    each       case
                                  separating the systemic and
                                  idiosyncratic factors.
Instant liquidity ratio (N2)      This ratio is intended to limit the       Minimum 15%
                                  bank’s liquidity risk within one
                                  operational day. It is formulated
                                  as the minimum ratio of a bank’s
                                  highly liquid assets to its liabilities
                                  payable on demand.
Current liquidity ratio (N3)      This ratio is intended to limit the       Minimum 50%
                                  bank’s liquidity risk within 30
                                  calendar days preceding the date
                                  of the calculation of this ratio. It
                                  is formulated as the minimum
                                  ratio of a bank’s liquid assets to
                                  its liabilities payable on demand
                                  and liabilities with terms of up to
                                  30 calendar days.




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                                                                        CBR Mandatory Economic
Mandatory Economic Ratios        Description                            Ratio Requirements
Long-term liquidity ratio (N4)   This ratio is intended to limit the    Maximum 120%
                                 bank’s liquidity risk arising from
                                 placement of funds into long-
                                 term assets. It is formulated as
                                 the maximum ratio of the bank’s
                                 credit claims maturing in more
                                 than one year to the sum of its
                                 capital base and liabilities
                                 maturing in more than one year.
Maximum exposure to a single     This ratio is intended to limit the    Maximum 25%
borrower or a group of related   credit exposure of a bank to one
borrowers (N6)                   borrower or a group of related
                                 borrowers (defined as persons
                                 who belong to the same banking
                                 or financial industrial group, are
                                 close relatives, or persons who
                                 can directly or indirectly
                                 materially influence the decisions
                                 of legal entity borrowers). It is
                                 formulated as the maximum ratio
                                 of the aggregate amount of the
                                 bank’s various credit claims
                                 against a borrower (or a group of
                                 related borrowers) to its capital
                                 base.
                                 On September 10, 2004, the CBR
                                 issued Regulation No. 106-T
                                 recommending that Russian
                                 banks implement this exposure
                                 limit for economically related
                                 borrowers. Under Regulation
                                 No. 106-T, borrowers are
                                 considered economically related
                                 if the decline in the financial
                                 condition of one borrower affects
                                 or may affect the financial
                                 condition of the other borrower
                                 and may result in such borrower’s
                                 inability to perform its obligations
                                 to the bank (e.g., if a borrower is
                                 simultaneously a borrower of a
                                 bank and a debtor of another
                                 borrower of the bank).
                                 To conform Russian prudential
                                 norms to the recommendations
                                 of the Basle Committee on
                                 Banking Supervision and IFRS,
                                 the CBR has also published a
                                 draft Regulation that establishes
                                 a 25% exposure limit for
                                 economically related borrowers
                                 (N6.1) mandatory two years after
                                 the Regulation is officially
                                 published. The official publication
                                 date has not yet been determined.



                                                   83
                                                                            CBR Mandatory Economic
Mandatory Economic Ratios           Description                             Ratio Requirements
Maximum amount of major             This ratio is intended to limit the     Maximum 800%
credit risks (N7)                   aggregate amount of a bank’s
                                    major credit risks (defined as the
                                    sum of loans to, and guarantees
                                    or sureties in respect of, one client
                                    that exceeds 5% of a bank’s
                                    capital base). It is formulated as
                                    the maximum ratio of the
                                    aggregate amount of major credit
                                    risks to a bank’s capital base.
Maximum amount of loans,            This ratio is intended to limit a       Maximum 50%
bank guarantees and sureties        bank’s credit exposure to the
extended by the bank to its         bank’s owners. It is formulated as
participants (shareholders)         the maximum ratio of the amount
(N9.1)                              of loans, bank guarantees and
                                    sureties extended by the bank to
                                    its participants or shareholders,
                                    to its capital base.
Aggregate amount of exposure        This ratio is intended to limit the     Maximum 3%
to the bank’s insiders (N10.1)      aggregate credit exposure of a
                                    bank to its insiders (defined as
                                    individuals capable of influencing
                                    credit decisions). It is formulated
                                    as the maximum ratio of the
                                    aggregate amount of the bank’s
                                    credit claims against its insiders
                                    to its capital base.
Ratio for the use of the bank’s     This ratio is intended to limit the     Maximum 25%
capital base to acquire shares      aggregate risk of a bank’s
(participation interests) in        investments          in       shares
other legal entities                (participation interests) of other
(N12)                               legal entities. It is formulated as
                                    the maximum ratio of the bank’s
                                    investments          in       shares
                                    (participation interests) of other
                                    legal entities to its capital base.

In addition, in May 2004, the CBR issued Regulation No.112-I, which outlines the mandatory economic
ratios for credit organisations that issue mortgage-backed bonds. The new regulation provides that the
capital adequacy (N1) ratio for such banks should be at least 14%. In addition, the new regulation details
the methods of calculation of new ratios that were introduced by the Federal Law ‘‘On Mortgage-Backed
Securities,’’ such as the minimum ratio of 10% for loans secured by mortgages to a bank’s capital base
(N17), the minimum ratio of 100% for claims relating to principal and interest of loans secured by
mortgages to the principal plus interest of issued mortgage-backed bonds (N18) and the maximum ratio
of 50% for a bank’s aggregate obligations to the creditors who have priority right to satisfy their claims
before holders of mortgage-backed bonds (such as a bank’s depositors) to a bank’s capital base (N19).
Banks are required to comply with these special ratios from the time when the decision is taken to issue
mortgage-backed bonds until the complete redemption of such bonds.

The capital base of a bank is calculated on the basis of RAR and defined in the CBR regulations as the
aggregate amount of its main capital (including, inter alia, its statutory charter capital, paid-in capital and
certain reserve and other internal funds, as well as certain amounts of profit) and additional capital
(including, inter alia, revaluation surpluses, subordinated loans and certain preferred shares) decreased by
certain mandatory reserves and other amounts.




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Liquidity Support by the CBR
Under the CBR Law and the Banking Law, the CBR is authorised to disburse loans and place deposits
with credit organisations that meet certain requirements with respect to, among other things, financial
stability, absence of overdue liabilities toward the CBR and the CBR’s ability to directly debit the credit
organisation’s correspondent account, in order to support such credit organisations’ liquidity position. The
CBR’s loans are required to be either secured with a pledge of certain securities or receivables specified
by the CBR or backed with suretyship of companies specified by the CBR. The interest rates on the loans
offered by the CBR range from 0% for intra-day loans to 12% for overnight loans pursuant to the CBR
Regulation No. 122-P of October 3, 2000, the CBR Regulation No. 236-P of August 4, 2003, the CBR
Regulation No. 273-P of July 14, 2005, and the CBR Regulation 1643-U of December 23, 2005. The CBR’s
deposits are placed on the basis of results of auctions arranged by the CBR. Such deposits may be either
at fixed rates determined prior to the auction or at fixed or floating rates set during the auctions.
Depending on the type of deposit offered, the CBR establishes specific requirements as to request forms
and deposits’ amounts, terms and interest rates, pursuant to the CBR Regulation No. 203-P of
November 5, 2002.

Capital Requirements
The CBR sets minimum equity (charter capital) requirements for banks. Under the CBR Regulation
No. 1346-U of December 1, 2003, the minimum capital requirement is set at u5 million for each
newly-founded bank. Banks whose capital base falls below their charter capital are required to adjust their
capital base accordingly (or, if impossible, reduce their charter capital). The procedure for reduction of
banks’ charter capital to adjust the amount of their capital base is established by the CBR Regulation No.
1260-U of March 24, 2003.

Reporting Requirements
Under the CBR Regulation No. 1376-U of January 16, 2004, routine reporting is performed by credit
organisations on a daily, five-day, ten-day, monthly, quarterly, half-yearly and yearly basis; certain
reporting is effected on a non-regular basis. Specific monthly reporting requirements apply to credit
organisations on liquidation pursuant to the CBR Regulation No. 1594-U of July 14, 2004.
Under the Banking Law, banking groups (i.e., groups of credit organisations in which one credit
organisation, directly or indirectly, exercises substantial influence on other credit organisations within the
group) and banking holdings (i.e., groups of legal entities in which one entity, which is not a credit
organisation, exercises substantial influence on a credit organisation within the group) must regularly
submit consolidated financial statements and calculations of mandatory ratios on a consolidated basis to
the CBR.

Mandatory Reserve Requirements
To cover possible loan losses and currency, interest and financial risks, banks are required to comply with
the CBR requirements for the formation of various types of mandatory reserves. The Board of Directors
of the CBR sets particular reserve requirements from time to time. Pursuant to the CBR Regulation
No. 1473-U of July 7, 2004 and the CBR Regulation No. 1456-U of June 25, 2004, banks are currently
required to post mandatory reserves to be held in non-interest bearing accounts with the CBR in the
amount equal to 3.5% in respect of funds in roubles and foreign currency attracted from individuals and
entities other than non-resident banks and 2% in respect of funds in roubles and foreign currency
attracted from non-resident banks. The mandatory reserves are calculated by banks in accordance with
the CBR Regulation No. 255-P of March 29, 2004. Banks are required to promptly report to the CBR and
its regional units after the end of each calendar month with calculation of reserves and prompt posting of
additional reserves, if necessary. The CBR and its regional units have a right to conduct unscheduled
audits of credit organisations to check their compliance with the reserves rules, to collect the non-reserved
amounts from the banks’ correspondent accounts, as well as to impose fines for non-compliance with the
reserve requirements.

Provisioning and Loss Allowances
The CBR has put in place rules concerning creation of allowances for loan losses for loans extended by
banks. Russian credit organisations are required to calculate and establish their allowances for loan losses
in accordance with the CBR Regulation No. 254-P, dated March 26, 2004. This regulation requires credit

                                                     85
organisations to rank their loans into five categories: quality I category (standard loans)—the absence of
credit risk; quality II category (non-standard loans)—moderate credit risk; quality III category (doubtful
loans)—considerable credit risk; quality IV category (problem loans)—high credit risk; quality V category
(bad loans)—absence of probability that the loan will be repaid. The allocation of the loan into a
particular group should be made on the basis of a professional judgment. The range of loans that must be
provided for includes rights assigned under contracts, mortgages acquired in the secondary markets,
claims relating to the purchase of financial assets with deferred payment, rights under repo contracts (if
such repo contracts are concluded in respect of unlisted securities) and some other operations. Loans
classified as category I loans (standard loans) need not be provided for. Category II through V loans entail
the following provisions, respectively: (i) 1% to 20%; (ii) 21% to 50%; (iii) 51% to 100%; and (iv) 100%.

The CBR has also established rules for creation of allowances for possible losses, other than loan losses,
which may include losses from investments in securities, funds held in correspondent accounts of other
banks, contingent liabilities, and forward and other transactions. The CBR Regulation No. 232-P of
July 9, 2003 requires banks to place such assets and operations into one of five risk groups reflecting the
following situations: (i) no real or potential threat of loss; (ii) moderate potential threat of loss;
(iii) serious potential or moderate real threat of loss; (iv) significant potential as well as moderate real
threat of losses or significant real threat of loss; and (v) value of the particular type of asset or operation
is fully lost. Banks are then required to provide allowances for each type of asset or operation in the
amounts corresponding to the amounts of possible losses but within the following framework established
by the CBR for each risk group indicated above, respectively: (i) 0%; (ii) 1% to 20%; (iii) 21% to 50%;
(iv) 51% to 100%; and (v) 100%. Banks must report to the CBR on the amounts of created non-loan
allowances within ten days following the end of the reporting month. The CBR and its regional units are
responsible for monitoring the compliance of banks with these rules.

Pursuant to the CBR Regulation No. 1584-U of June 22, 2005, mandatory allowances must also be created
for operations with residents of certain off-shore jurisdictions in the amounts of 25% or 50% depending
on the jurisdiction involved.


Regulation of Currency Exposure

In its Regulation No. 124-I of July 15, 2005, the CBR established rules regarding exposure of banks to
foreign currency and precious metals (collectively, ‘‘currency exposure’’). Currency exposure is calculated
with respect to net amounts of balance sheet positions, spot market positions, forward positions, option
positions and positions under guarantees, suretyship and letters of credit. Open currency position is
calculated as the sum of all these net amounts. Such exposure is calculated for each currency and each
precious metal, and then recalculated into roubles in accordance with the official exchange rates and the
CBR’s prices for precious metals.

The CBR has established that at the end of each operational day the total amount of all long or short
currency positions shall not exceed 20% of the bank’s capital base. At the same time, at the end of each
operational day the long or short position with respect to one particular currency or precious metal shall
not exceed 10% of the bank’s capital base.


Accounting and Auditing Practices

Pursuant to the CBR Regulation No. 205-P dated December 5, 2002, financial statements of credit
organisations must be prepared in accordance with RAR. Pursuant to the CBR Regulation No. 1363-U
dated December 25, 2003, credit organisations are required to submit their financial statements to the
territorial institutions of the CBR for the period from January 1 to December 31 prior to July 1 of the
following year.

Pursuant to the CBR Letter No. 19-T dated February 10, 2006, credit organisations must also prepare
financials statements in accordance with IFRS on the basis of financial statements prepared in accordance
with RAR and submit them to the CBR prior to July 1 of the following year.

Annual audits of credit organisations must be carried out by a licensed auditing company under Russian
auditing standards applicable to credit organisations.


                                                     86
Insolvency of Credit Organisations
Petition to the CBR for Licence Revocation
Under the Bank Insolvency Law, if a credit organisation cannot satisfy creditors’ claims within 14 days of
when they come due, the following persons may petition the CBR (the ‘‘Licence Revocation Petition’’)
to revoke the credit organisation’s licence:
•   the credit organisation;
•   its creditors; and
•   the Federal Tax Service.
Under the Banking Law, the CBR must revoke a licence of a credit organisation if:
•   the credit organisation’s capital adequacy ratio falls below 2% in accordance with Russian standards;
•   the credit organisation’s capital base is less than the minimum nominal charter capital requirement
    established by the CBR;
•   the credit organisation fails to adjust its capital base and nominal charter capital within 45 days of the
    CBR’s request; or
•   the credit organisation fails to satisfy the monetary claims of its creditors, including taxes and other
    mandatory payments, in the aggregate amount of at least RUR100,000 within 14 days of when they
    become due.
Under the Banking Law, the CBR may revoke the licence of a credit organisation if:
•   the information upon which the licence was issued is false;
•   the credit organisation fails to begin operations within one year of the date of issuance of the licence;
•   the credit organisation discloses required information that is materially false;
•   the credit organisation fails to submit its monthly report to the CBR within 15 days of when it is due;
•   the credit organisation fails to submit information that must appear in the state register of legal
    entities;
•   the credit organisation conducts banking operations for which it does not hold a licence (including
    cases when a single banking operation was conducted);
•   the credit organisation’s activities do not comply with Banking Law where, in the past year, it was
    subject to corrective measures imposed by the CBR;
•   the credit organisation does not follow court decisions regarding the payment of funds from its
    clients’ accounts;
•   a credit organisation that manages assets involved in a mortgage-backed securities transaction fails
    to comply with the requirements of the Federal Law No. 152-FZ ‘‘On Mortgage Backed Securities’’
    of November 11, 2003; or
•   the temporary administration appointed to manage a credit organisation pursuant to the Bank
    Insolvency Law requests the revocation of the licence.
Consequences of the CBR Decision on Licence Revocation
If, in response to the Licence Revocation Petition, the CBR revokes the credit organisation’s licence, any
of the following entities can petition an arbitrazh court (a Russian commercial court) to declare the credit
organisation insolvent (the ‘‘Insolvency Petition’’):
•   the credit organisation;
•   its creditors;
•   the Federal Tax Service; and
•   the CBR.
Similarly, if the CBR fails to respond to the Licence Revocation Petition within two months of its
submission, such persons can then file an Insolvency Petition to the arbitrazh court. If the CBR rejects the

                                                     87
Licence Revocation Petition, it may be liable for any losses a creditor incurs as a result of the
non-revocation of the licence. Upon revocation of the credit organisation’s licence, the CBR must appoint
a temporary administration for the credit organisation if such temporary administration is not already in
place. The appointment of the temporary administration lasts until the appointment of a receiver.
See ‘‘—Appointment of a Receiver.’’ Additionally, upon revocation of the credit organisation’s licence,
the credit organisation may not enter into new transactions or perform transactions pursuant to existing
obligations except in the limited cases set forth under the Banking Law.
A local periodical must publish information on an arbitrazh court’s judgement on the Insolvency Petition.
Such publication sets forth, among other things, the time frame for the acceptance and satisfaction of
creditors’ claims.

Insolvency Proceedings
After hearing an Insolvency Petition, the arbitrazh court may declare the credit organisation insolvent if
its assets are insufficient to satisfy its creditors’ claims at any time.
Upon such a declaration, a moratorium on payments to existing creditors takes effect, and the credit
organisation may perform its contracts only according to the ranking of claims set forth under the Bank
Insolvency Law and the Insolvency Law.

Appointment of a Receiver
After the arbitrazh court declares a credit organisation insolvent:
•   if the credit organisation did not hold a retail banking licence, the court appoints a
    CBR-accredited receiver;
•   if the credit organisation held a retail banking licence, the Deposit Insurance Agency acts as the
    receiver.
Upon its appointment, the receiver assumes the management of the credit organisation’s operations. The
receiver’s appointment is initially for one year but may be extended by law for a further six-month period
and, in practice, for a longer period.
The receiver’s functions include:
•   analysis of the credit organisation’s financial standing;
•   valuation of its assets;
•   identification of its creditors and providing them with notice of the credit organisation’s insolvency;
•   identification of debtors and requesting performance of their obligations to the insolvent credit
    organisation; and
•   other functions as set forth under the Bank Insolvency Law.
The receiver reports to a committee of creditors and to the CBR, subject to supervision by an arbitrazh
court.

Invalidation of Transactions and Refusal to Perform Obligations
Under the Bank Insolvency Law, the receiver or any creditor may invalidate transactions:
•   entered into within three years before the appointment of the temporary administration; and
•   the terms and conditions of which are significantly less favourable to the credit organisation than
    those of a similar transaction entered into under comparable circumstances.
In addition, under the Bank Insolvency Law, the receiver may refuse to perform any transaction that
results in losses to the credit organisation where a similar transaction would not ordinarily result in such
losses.
The transactions may also be invalidated pursuant to the Bankruptcy Law. Particularly, the receiver or a
creditor can invalidate a transaction entered into within six months prior to initiation of bankruptcy
proceedings, if such transaction would lead to the preferential satisfaction of claim of one creditor over
other creditors.


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Priority of Claims
Under the Bank Insolvency Law and the Insolvency Law, the claims of creditors of a credit organisation
rank in the following order of priority:
•   claims related to the administration of insolvency proceedings, including salaries of personnel
    involved in insolvency proceedings, utilities bills, legal expenses and other payments;
•   first priority claims, including:
    •    claims in tort for damages in respect of physical persons’ life or health, as well as moral damages;
    •    claims of retail depositors and individuals holding current accounts (except for individual
         entrepreneurs);
    •    claims of the Deposit Insurance Agency in respect of deposits and current accounts transferred
         to it pursuant to the Deposit Insurance Law; and
    •    claims of the CBR relating to the CBR payments to retail depositors of insolvent credit
         organisations that are not participants in the deposit insurance system;
•   claims under employment contracts and other social benefits and copyright claims;
•   claims secured by a pledge of the credit organisation’s assets. Any residual claims of secured creditors
    that remain unsatisfied after the sale of such collateral rank pari passu with claims of unsecured
    creditors;
•   claims of all other creditors except for claims of subordinated creditors; and
•   claims of subordinated creditors.
Claims of each category of creditors must be satisfied in full before claims of the next category may be
considered.
Completion of Insolvency Proceedings
Upon the collection of debts and satisfaction of claims, to the extent possible, the receiver submits a
report to the arbitrazh court, which in turn extends or closes the insolvency proceedings.
Subordinated Debt
The concept of subordinated debt is set out in the Bank Insolvency Law and CBR Regulation No. 215-P
dated February 10, 2003. In accordance with Regulation No. 215-P subordinated loans are accounted for
by Russian credit organisations as supplementary capital, which is included into the credit organisation’s
capital base (‘‘own funds’’). The concept of Tier 1 capital and Tier 2 capital may be generally applied to
the Russian banking regulatory requirements, though certain differences may exist in details of
classification. The Russian ‘‘own funds’’ classification is own capital = core capital + supplementary
capital. Supplementary capital cannot exceed 100% of core capital, subject to core capital not being
negative. Subordinated loan is an element of supplementary capital and cannot exceed 50% of core
capital.
Subordinated loans eligible for inclusion into own funds of the credit organisation should satisfy the
following criteria:
•   their term should not be less than five years;
•   they should include a provision prohibiting early termination (except if the parties agree on the
    lender’s contribution into equity of the borrower in the amount not less than the amount of the loan);
•   terms of the loan should not materially differ from the prevailing market terms of similar loans;
•   the loan specifically provides for the lowest creditor priority ranking of the lender in the event of the
    bank’s bankruptcy;
•   the loan is unsecured;
•   no individuals are party to the loan agreement; and
•   the loan agreement makes it possible to revise the interest rate under the subordinated loan
    agreement without reference to material increase of average interest rates at the date of such
    revision.

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Regulation No. 215-P provides for only two types of subordinated debt: subordinated loan and
subordinated deposit. At the same time, the Bank Insolvency Law also refers to ‘‘subordinated notes.’’
Regulation No. 215-P envisages the possibility of the bank entering into agreements amending its
subordinated loan. Such additional agreements should likewise be submitted to the CBR for review and
approval. If the amendments introduced by such additional agreement do not comply with the above
requirements for subordinated loans, such subordinated loan would not be treated as regulatory capital
from the date of the additional agreement and the credit organisation’s own funds should be reduced
accordingly.

Accounting Treatment
•   Capital Treatment. Regulation No. 215-P provides that a subordinated loan is included into the
    calculation of the bank’s capital only from the next reporting date (presumably, the next month)
    following the confirmation by the local office of the CBR of the positive result of its legal due
    diligence exercise in respect of the loan documentation for compliance with regulatory subordinated
    loans criteria. Such review should be completed by the CBR within one month following the
    submission of the draft loan documentation by the bank (see ‘‘Approval of the CBR’’).
•   Amortisation. Russian regulatory capital rules prescribe that during the last five years to maturity
    of the subordinated debt a cumulative discount (or amortisation) of 20% per year will be applied to
    reflect the diminishing value of subordinated debt. According to Regulation No. 215-P, amortisation
    is applied on a quarterly basis in accordance with the following formula:
          C
    O = ––––––x D, where
          20
    O is the amortised value of the subordinated loan;
    D is the full amount of the subordinated loan extended to the bank;
    C is the number of complete quarters (January 1 – March 31, April 1 – June 30 etc.) remaining until
         the repayment of the subordinated loan (C < 20).

Insolvency Treatment
Whereas the Civil Code does not specifically recognise subordination, the Bank Insolvency Law
recognises statutory subordination of creditors under subordinated debt arrangements in the event of a
credit organisation’s insolvency. Pursuant to Article 50.36(6) of the Bank Insolvency Law, the claims of the
subordinated creditors rank behind those of all unsubordinated creditors who are entered into the
creditors’ register.

Approval by the CBR
The procedure for obtaining the CBR’s approval for the subordinated loan is outlined in Regulation
No. 215-P.
Regulation No. 215-P allows the borrower to initiate the approval procedure before the funds are
disbursed: it may submit a draft or an executed loan agreement for the CBR’s consideration. As a result
of its review, the CBR territorial agency may come back with comments or may issue a letter confirming
that the loan agreement complies with Regulation No. 215-P with a caveat that the final conclusion on the
regulatory treatment of the subordinated loan may not be issued until the date of the actual disbursement
of the loan. The final conclusion is usually issued within 30 days from the date of disbursement of funds
and submission of the relevant documents.

Other Banking Laws and Regulations

Credit Histories
In December 2004, the Federal Law ‘‘On Credit Histories’’ was passed. This law provides for the
establishment of ‘‘credit bureaus’’ that will maintain a database of borrowers’ credit histories. The law
requires all credit organisations, starting from September 1, 2005, to provide at least one credit bureau
with the credit histories of all borrowers that have consented to the distribution of their credit histories.


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The borrower’s credit history will consist of both public and confidential parts and must include, among
other facts, information on the borrower’s outstanding debt and interest on it, the terms of repayment and
any legal proceedings involving the borrower in respect of loans and credits. The borrower’s credit history
may be distributed to a third party who obtained the borrower’s consent which is valid within one month
from the date thereof. The general catalogue of credit histories is maintained by the CBR and includes
cover pages of all credit histories and credit bureaus that maintain the respective credit histories. The
credit bureaus are supervised by the FSFM. Following enactment of the new law, a number of credit
bureaus have been established.

Capital Markets Transactions
According to the CBR Law, state registration of all securities issued by credit organisations is conducted
by the CBR. The CBR Regulation No. 128-I dated March 10, 2006 provides that the following securities
issuances are subject to registration with the Moscow Head Office of the CBR:
•   share issuances of credit organisations with the charter capital not less than RUR1 billion;
•   share issuances of credit organisations with foreign participation interest exceeding 50%, including
    issuances of credit organisations with participation interests of individuals and legal entities from the
    CIS;
•   bond issuances of credit organisations for the amount not less than RUR1 billion;
•   securities issuances carried out in the course of reorganisation of credit organisations; and
•   issuances of option certificates.
All other securities issuances of credit organisations are registered with the territorial departments of the
CBR.
The FSFM is the regulator for Russian banks as brokers, dealers or securities custodians on the Russian
market. The FSFM also acts as the supervisory and control authority for all professional market
participants, including banks, with respect to their compliance with Russia’s securities laws and
regulations. To act as a securities broker or dealer or to provide custody services (other than when acting
as a paying agent), a Russian bank or credit organisation must obtain appropriate licenses issued by the
FSFM.

Currency Control
The Currency Law is generally aimed at the gradual liberalisation of Russian currency control regulations,
but at the same time, it introduces new forms of currency control (such as the placement of mandatory
deposits and the use of special accounts). The Currency Law provides for most of the current restrictions
to remain effective until January 1, 2007. See ‘‘Risk Factors—Risks Relating to the Russian Legal System
and Russian Legislation—Significant changes in Russian banking and financial regulation.’’ Under the
Currency Law, instead of the use of transaction specific licences, the government and the CBR may
establish a general regime for the use of foreign currency applicable to all market participants. With
respect to certain currency operations, residents and non-residents may be subject to mandatory deposit
requirements in the amount of either up to 100% of the amount of the operation for a period of up to 60
days or up to 20% for a period of up to one year (excluding export/import operations for which other rules
may apply). In addition, the CBR may require residents and non-residents to carry out certain operations
through special accounts in addition to the above mandatory deposit requirements. In particular,
settlements between residents and non-residents in relation to loans in foreign currency and roubles, as
well as securities, non-banking operations of banks and conversion operations, may be covered by such
special accounts and mandatory reserve requirements (however, conversion restrictions may not be
imposed on authorised banks). Furthermore, the CBR retains the right under the Currency Law to
introduce currency controls applicable to the banking operations of credit organisations.
The government and the CBR have already implemented some of these restrictions. For example, a
corporate resident (excluding Russian banks) is required to use a type ‘‘R2’’ special foreign currency
account for the acquisition of foreign securities, as well as to place mandatory deposits into a non-interest
bearing account in the amount of 25% of the rouble equivalent of funds transferred through an ‘‘R2’’
account for a period of 15 days.
Under the Currency Law, restrictive measures are to be implemented by the CBR and/or the government
in light of economic circumstances to prevent a substantial reduction in Russia’s gold and foreign

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exchange reserves, to neutralise currency rate swings and to secure a stable payment balance in Russia.
Accordingly, such restrictions should not be implemented or extended unless the Russian economy is in
decline, but the criteria for the introduction of such restrictive measures are sufficiently broad so to allow
the CBR and the Russian government significant discretion as to their implementation.

Anti-Money Laundering
In August 2001, the Federal Law ‘‘On Combating the Legalisation (Laundering) of Income Obtained by
Criminal Means’’ (the ‘‘Anti-Money Laundering Law’’) was adopted to comply with the requirements of
the Financial Action Task Force on Money Laundering (‘‘FATF’’). The Anti-Money Laundering Law
came into effect on February 1, 2002. Credit organisations are required to comply with the provisions of
the Anti-Money Laundering Law relating to, among other things, the development of appropriate
internal standards and procedures, client identification, control over client operations and reporting of
suspicious activities.
One of the main obligations of banks under the Anti-Money Laundering Law is the control function that
involves identification of banks’ clients, information gathering with respect to client’s operations and
reporting of specific operations to the Federal Service for Financial Monitoring, the anti-money
laundering authority in Russia. The Anti-Money Laundering Law requires that banks control any
operations with money or other property if the sum of such operation is equal to or exceeds RUR600,000
(or its equivalent in foreign currencies) when such operation involves any of the following: cash
transactions, transactions when one of the counter-parties is resident or has a bank account in a country
that does not participate in international efforts to combat money-laundering (which generally corresponds
to the ‘‘black list’’ issued by FATF), making certain bank deposits that do not identify beneficiaries, and
other similar transactions involving precious stones, precious metals and other property. In addition,
banks are required to control any operation involving any individual or organisation that is known to
participate in terrorist activities and any legal entity controlled by them or their agents. If bank officers
suspect that an operation is conducted in order to legalise any funds received as a result of illegal activity
or to finance terrorist activities, they are required to report such operations, whether or not they qualify
as controlled operations. Banks are not allowed to inform clients that transactions are being reported to
the Federal Service for Financial Monitoring.

Brief History of the Russian Banking Sector
Prior to the reorganisation of 1987, the Soviet banking system consisted of Gosbank, which allocated
resources from the state budget according to the prevailing economic plan and in whose regional branches
all production and trading entities held their current accounts, Stroybank of the USSR and Vneshtorgbank
of the USSR, which primarily serviced payments relating to capital construction projects and the foreign
trade of Soviet entities, respectively. Gosbank operated a network of so-called ‘‘savings branches’’
(sberegatelnyie kassy) that offered limited banking services to retail clients (mainly taking deposits and
processing utility payments) throughout the country.
In 1987, with the relaxation of controls over companies and the implementation of ‘‘self-financing’’ system
in the economy, which minimised reliance on state subsidies, the Soviet banking system was reorganised.
A few specialised banks developed to service specific industries, such as Agroprombank (Farming
Production Bank), Promstroybank (Production and Construction Bank), Zhilsotsbank (Bank for Housing
Maintenance and Utilities Sector and Social Development), Vnesheconombank of the USSR (Bank for
Foreign Economic Activity) and Sberbank of the USSR (Bank for Labour Savings and Lending to the
Population).
Between 1991 and 1998, the Russian banking system experienced rapid growth. The number of
commercial banks in Russia increased from approximately 358 in 1990 to 2,538 in 1996. A number of large
privately held banking groups were formed, including UNEXIM Bank, Incombank, Bank Menatep, Bank
Russian Credit and Bank SBS-Agro. Although most private banks focused on providing banking services
to newly privatised companies and working with the governmental and municipal funds, several started
to compete with the state-owned banks in various regions of Russia in offering banking products to retail
clients.
After the government’s and the CBR’s announcements on August 17, 1998, the Russian financial markets
suffered severe financial crisis, resulting in significant concerns over the liquidity and solvency of the
banking sector. Many banks were subsequently reorganised, went bankrupt or fell under the administration
of the Agency for the Restructuring of Credit Organisations (‘‘ARCO’’), a state corporation for ensuring

                                                     92
the financial recovery of banks and protecting the interests of their creditors, which was established in
1999. In 2002, 14 banks were administered by ARCO and by December 31, 2002, 11 of them had
completed the process of financial restructuring. Since the 1998 financial crisis, the number of credit
organisations operating in Russia has been falling. Pursuant to Federal Law No. 87-FZ, dated
July 28, 2004, ARCO was liquidated.
The 1998 financial crisis demonstrated the lack of proper controls in the Russian banking sector and
reinforced concerns about the integrity of the Russian banking system. From 1999 through 2001, the
Russian banking system went through a period of recovery from the 1998 financial crisis that was
characterised by higher liquidity levels and a shift in emphasis from investments in government securities
to loans to companies and other legal entities.
From April through July 2004, the Russian banking sector experienced its first serious turmoil since the
financial crisis of August 1998. As a result of various market rumours and, in some cases, certain
regulatory and liquidity problems, several privately-owned Russian banks experienced liquidity problems
and were unable to attract funds on the interbank market or from their client base. Simultaneously, they
faced large withdrawals of deposits by both retail and corporate clients. Several of those privately-owned
Russian banks collapsed or severely limited their operations. The CBR took several steps to combat the
crisis, including adding liquidity to the sector by reducing the rate of mandatory reserves that banks are
required to deposit with the CBR from 7% to 3.5%.
Russian banks owned or controlled by the Russian government or the CBR, including Sberbank, as well
as foreign-owned banks, generally were not adversely affected by the turmoil. As a result of the banking
sector turmoil, Sberbank’s retail deposits rose slightly, due to higher confidence of retail clients in
state-owned banks.




                                                   93
                                                THE ISSUER
SB Capital S.A. was incorporated as a société anonyme on April 21, 2006 for an unlimited duration with
limited liability under the laws of Luxembourg. Its Articles of Incorporation are expected to be published
in the Mémorial Journal Officiel du Grand-Duché de Luxembourg, Recueil des Sociétés et Associations. It
is registered with the Register of Commerce and Companies, Luxembourg under number B-115914. Its
registered office is located at 2, Boulevard Konrad Adenauer, L-1115 Luxembourg. The Issuer may be
reached by telephone at +352-421-22-243.
SB Capital S.A.’s subscribed share capital amounts to U.S.$50,000 divided into 500 shares with a par value
of U.S.$100 each. All of the shares are fully paid up. Four hundred and ninety nine shares are owned by
Stichting SB Capital Luxembourg and one share by Stichting Participatie DITC Amsterdam. SB Capital
S.A. is not a subsidiary of Sberbank.

Corporate Governance
SB Capital S.A. is a special purpose vehicle that engages in limited activities, and it is governed for the
most part by the Board of Directors, currently consisting of three directors. The directors at present are:
•   Rolf Caspers, banker, having his professional address at 2, Boulevard Konrad Adenauer, L-1115
    Luxembourg;
•   Vincent de Rycke, banker, having his professional address at 2, Boulevard Konrad Adenauer, L-1115
    Luxembourg; and
•   Tom Verheyden, banker, having his professional address at 2, Boulevard Konrad Adenauer, L-1115
    Luxembourg.
The Issuer is unaware of any conflicts of interest between the duties that any director owes to the Issuer
and such director’s private interests or other duties.
Deutsche Bank Luxembourg S.A. is the domiciliation agent of SB Capital S.A. Its duties include the
provision of certain administrative and related services. Its appointment may be terminated and it may
retire upon two months’ prior notice, subject to it providing the Issuer and the Trustee with a list of at least
three suitable domiciliation agency service providers.
SB Capital S.A. is established for the purposes described in Article 3 of its Articles of Incorporation, as
follows:
•   the issue of loan participation notes and other debt securities under a programme for the issuance of
    loan participation notes for the purpose of financing loans to Sberbank;
•   the granting of loans to Sberbank;
•   the granting of security interests over its assets to a trustee in relation to the issuance of the loan
    participation notes and other debt securities;
•   the making of deposit (including fiduciary deposits) at banks or with other depositaries; and
    the entering into all ancillary transactions, documents and agreements.
SB Capital S.A. may carry out any transactions, whether commercial or financial, which are directly or
indirectly connected with its corporate object at the exclusion of any banking activity. In general, SB
Capital S.A. may carry out any operation that it may deem useful or necessary in the accomplishment and
the development of its corporate purpose.

Financial Statements
Since April 21, 2006 (the date of its incorporation), the Issuer has not conducted operations, and no
financial statements have been prepared as of the date of this Base Prospectus. The Issuer’s fiscal year will
end on December 31 of each year. There has been no material adverse change in the capitalisation of the
Issuer since its incorporation.

Auditors
              ´                        `
Elpers & Co. Reviseurs d’entreprises S.a r.l. are the statutory auditors of the Issuer. The address of
              ´                        `
Elpers & Co. Reviseurs d’entreprises S.a r.l. is 11, Boulevard du Prince Henri, L-1724 Luxembourg.
              ´                        `                                         ´
Elpers & Co. Reviseurs d’entreprises S.a r.l. is a member of the Institut des Reviseurs d’Enterprises.

                                                      94
                                      FACILITY AGREEMENT

This Facility Agreement is made on 12 May 2006 between:
(1)   SBERBANK, a company established under the laws of the Russian Federation whose registered
      office is at 19 Vavilova Street, 117997 Moscow, Russian Federation (‘‘Sberbank’’); and
(2)   SB CAPITAL S.A., a société anonyme established under the laws of Luxembourg whose registered
      office is at 2, Boulevard Konrad Adenauer, L-1115, The Grand Duchy of Luxembourg, registered
      with the Luxembourg Register of Commerce and Companies under number B-115914 (the
      ‘‘Lender’’).
Whereas, the Lender has at the request of Sberbank agreed, pursuant to this Agreement and any
subordinated loan agreements to be entered into from time to time by the Issuer and Sberbank, as
supplemented by a corresponding subordinated loan supplement (together each a ‘‘Subordinated Loan
Agreement’’), to make available to Sberbank a loan facility in the maximum amount of the Programme
Limit (as defined below) on the terms and subject to the conditions of either this Agreement, as amended
and supplemented in relation to each Loan (as defined below) by a Loan Supplement dated the Closing
Date substantially in the form set out in the Schedule hereto (each, a ‘‘Loan Supplement’’) or any
Subordinated Loan Agreement;
Whereas, it is intended that, concurrently with the extension of any Loan under this loan facility the
Lender will issue certain loan participation notes in the same nominal amount and bearing the same rate
of interest as such Loan.

Now it is hereby agreed as follows:

1     Definitions and Interpretation
1.1   Definitions
      In this Agreement (including the recitals), the following terms shall have the meanings indicated:
      ‘‘Account’’ means an account in the name of the Lender as specified in the relevant Loan
      Supplement.
      ‘‘Affiliates’’ of any specified Person means any other Person, directly or indirectly, controlling or
      controlled by or under direct or indirect control by such specified Person. For the purposes of this
      definition, ‘‘control’’ when used with respect to any Person means the power to direct the
      management and policies of such Person, directly or indirectly, whether through the ownership of
      voting securities, by contract or otherwise; and the terms ‘‘controlling’’ and ‘‘controlled’’ have
      meanings correlative to the foregoing.
      ‘‘Agency Agreement’’ means the paying agency agreement relating to the Programme dated
      12 May 2006, as may be amended or supplemented from time to time between the Lender, the
      Trustee and the agents named therein.
      ‘‘Arrangers’’ means Barclays Bank PLC and J.P. Morgan Securities Ltd. or any additional or
      replacement arranger appointed, and excluding any Arranger whose appointment has terminated
      pursuant to the Dealer Agreement.
      ‘‘Business Day’’ means (save in relation to Clause 4) a day (other than a Saturday or Sunday) on which
      (a) banks and foreign exchange markets are open for business generally in the relevant place of
      payment, and (b) if on that day a payment is to be made in a Specified Currency other than euro
      hereunder, where payment is to be made by transfer to an account maintained with a bank in the
      Specified Currency, foreign exchange transactions may be carried on in the Specified Currency in the
      principal financial centre of the country of such Specified Currency and (c) if on that day a payment is
      to be made in euro hereunder, a day on which the TARGET System is operating and (d) in relation to
      a Loan corresponding to a Series of Notes to be sold pursuant to Rule 144A under the Securities Act,
      banks and foreign exchange markets are open for business generally in New York City.
      ‘‘Calculation Agent’’ means, in relation to a Loan, JPMorgan Chase Bank, N.A., London Branch
      or any other person named as such in the relevant Loan Supplement or any successor thereto.
      ‘‘Change of Control’’ means the Central Bank of Russia and/or any other federal state agencies
      appropriately authorised to hold the shares of Sberbank (i) ceasing to own or control (directly or

                                                    95
indirectly) 50 per cent. plus one share of the issued and outstanding voting share capital of
Sberbank; or (ii) no longer has the right to appoint or remove a majority of Sberbank’s supervisory
council.
‘‘Change of Law’’ means any of the enactment or introduction of any new law, the variation,
amendment or repeal of an existing or new law, and any ruling on or interpretation or application
by a competent authority of any existing or new law which, in each case, occurs after the date
hereof and for this purpose the word ‘‘law’’ means all or any of the following whether in existence
at the date hereof or introduced hereafter and with which it is obligatory or customary for banks
or other financial institutions or, as the case may be, companies in the relevant jurisdiction to
comply:
(i)    any statute, treaty, order, decree, instruction, letter, directive, instrument, regulation,
       ordinance, or similar legislative or executive action by any national or international or local
       government or authority or by any ministry or department thereof and other agencies of
       state power and administration (including, but not limited to, taxation departments and
       authorities); and/or
(ii)   any letter, regulation, decree, instruction, request, notice, guideline, directive, statement of
       policy or practice statement given by, or required of, any central bank or other monetary
       authority, or by or of any Taxing Authority or fiscal or other authority or agency (whether
       or not having the force of law); and
the decision or ruling on, the interpretation or application of, or a change in the interpretation or
application of, any of the foregoing by any court of law, tribunal, central bank, monetary authority
or agency or any Taxing Authority or fiscal or other competent authority or agency.
‘‘Change of Control Payment Date’’ means the Business Day falling 90 days after Sberbank gives
notice to the Lender of a Change in Control pursuant to sub-Clause 5.4 or, if such day is not a
Business Day, the first Business Day immediately following such 90-day period.
‘‘Closing Date’’ means the date specified as such in the relevant Loan Supplement.
‘‘Day Count Fraction’’ has the meaning specified in the relevant Loan Supplement.
‘‘Dealer Agreement’’ means the dealer agreement relating to the Programme dated 12 May 2006
between the Lender, Sberbank, the Arrangers and the other dealers named therein or appointed
pursuant to it, as may be further amended or supplemented from time to time.
‘‘Dollars,’’ ‘‘$’’ and ‘‘U.S.$’’ means the lawful currency of the United States of America.
‘‘Encumbrance’’ means any mortgage, charge, pledge, lien (other than a lien arising solely by
operation of law which is discharged within 90 days of arising) or other security interest securing
any obligation of any Person or any other type of preferential arrangement (including any title
transfer and retention arrangement) having a similar effect.
‘‘euro’’ or ‘‘w’’ means the lawful currency of the member states of the European Union that
adopted the single currency in accordance with the Treaty of Rome establishing the European
Economic Community, as amended.
‘‘Event of Default’’ has the meaning assigned to such term in sub-Clause 11.1 hereof.
‘‘Financial Indebtedness’’ means any obligation for the payment of money in any currency, whether
sole, joint or several, and whether actual or contingent, in respect of:
(a)    moneys borrowed or raised (including the capitalised value of obligations under financial
       leases and hire purchase agreements which would, in accordance with IFRS, be treated as
       finance or capital leases, but excluding moneys raised by way of the issue of share capital
       (whether or not for a cash consideration) and any premium on such share capital) and
       interest and other charges thereon or in respect thereof;
(b)    any liability under any debenture, bond, note, loan stock or other security or under any
       acceptance or documentary credit, bill discounting or note purchase facility or any similar
       instrument;
(c)    any liability in respect of the deferred acquisition cost of property, assets or services to the
       extent payable after the time of acquisition or possession thereof by the party liable, but not
       including any such liability in respect of normal trade credit for a period not exceeding six
       months for goods or services supplied;

                                              96
(d)    any liability under any interest rate or currency hedging agreement (and the amount for
       such Financial Indebtedness in relation to any such transaction shall be calculated by
       reference to the mark-to-market valuation of such transaction (if it shows a sum owed to the
       counterparty of Sberbank or any Subsidiary), at the relevant time);
(e)    any liability under or in respect of any bonding facility, guarantee facility or similar facility;
       and
(f)    (without double counting) any guarantee or other assurance against financial loss in respect
       of such moneys borrowed or raised, interest, charges or other liability (whether the person
       liable in respect of such moneys borrowed or raised, interest, charges or other liability is or
       is not a member of the Group).
‘‘Fixed Rate Loan’’ means a Loan specified as such in the relevant Loan Supplement.
‘‘Floating Rate Loan’’ means a Loan specified as such in the relevant Loan Supplement.
‘‘Group’’ means Sberbank and its Subsidiaries taken as a whole.
‘‘IFRS’’ means the International Financial Reporting Standards issued by the International
Accounting Standards Board (as amended, supplemented or re-issued from time to time).
‘‘IFRS Financial Statements’’ means the most recent audited financial statements of Sberbank for
each financial year ended 31 December prepared in accordance with IFRS.
‘‘Interest Commencement Date’’ means the Closing Date or such other date as may be specified
in the relevant Loan Supplement.
‘‘Interest Payment Date’’ means the dates specified as such in the relevant Loan Supplement, or,
in the event of a prepayment in whole or in part in accordance with sub-Clauses 5.2, 5.3 and 5.4,
the date set for such redemption in respect of the part of the Loan to be redeemed.
‘‘Interest Period’’ means each period beginning on (and including) an Interest Payment Date or,
in the case of the first Interest Period, the Interest Commencement Date, and ending on (but
excluding) the next Interest Payment Date.
‘‘Lender Agreements’’ means the Dealer Agreement, this Agreement, the Agency Agreement, the
Principal Trust Deed and together with, in relation to each Loan, the relevant Subscription
Agreement, Loan Supplement and Supplemental Trust Deed.
‘‘Loan’’ means each loan to be made pursuant to, and on the terms specified in this Agreement and
the relevant Loan Supplement and includes each Fixed Rate Loan and Floating Rate Loan.
‘‘Loan Agreement’’ means this Agreement and (unless the context requires otherwise), in relation
to a Loan, means this Agreement as amended and supplemented by the relevant Loan
Supplement.
‘‘Material Adverse Effect’’ means a material adverse effect on (a) the financial condition or
operations of Sberbank or of Sberbank and any of its Principal Subsidiaries taken as a whole or
(b) Sberbank’s ability to perform its obligations under a Loan Agreement or (c) the rights or
remedies of the Lender under a Loan Agreement.
‘‘Noteholder’’ means, in relation to a Note, the person in whose name such Note is registered in
the register of the noteholders (or in the case of joint holders, the first named holder thereof).
‘‘Notes’’ means the loan participation notes that may be issued from time to time by the Lender
under the Programme in Series, each Series corresponding to a Loan and relating to a Loan as
defined in the relevant Loan Supplement.
‘‘Officer’s Certificate’’ means a certificate signed by an officer of Sberbank who shall be the
principal executive officer, principal accounting officer or principal financial officer of Sberbank.
‘‘Opinion of Counsel’’ means a written opinion from international legal counsel as reasonably
selected by Sberbank or the Lender, as the case may be, with the written consent of the Lender or
Sberbank, as the case may be, such consent not to be unreasonably withheld or delayed.
‘‘Person’’ means any individual, corporation, partnership, limited liability company, joint venture,
association, joint-stock company, company, firm, trust, organisation, government, or any agency or
political subdivision thereof or any other entity, whether or not having a separate legal personality.

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‘‘Potential Event of Default’’ means any event which, after notice or passage of time or both, would
be an Event of Default.
‘‘Principal Subsidiary’’ means at any relevant time a Subsidiary of Sberbank:
(i)    whose total assets or gross revenues (or, where the Subsidiary in question prepares
       consolidated accounts, whose total consolidated assets or gross consolidated revenues, as
       the case may be) represent not less than 10 per cent. of the total consolidated assets or the
       gross consolidated revenues of Sberbank and its Subsidiaries, all as calculated by reference
       to the then latest audited accounts (or consolidated accounts as the case may be) (in each
       case, produced on the basis of IFRS, consistently applied) of such Subsidiary and the then
       latest audited consolidated accounts of Sberbank (produced on the basis of IFRS,
       consistently applied) and its consolidated Subsidiaries; or
(ii)   to which is transferred all or substantially all the assets and undertaking of a Subsidiary
       which immediately prior to such transfer is a Principal Subsidiary.
‘‘Principal Trust Deed’’ means the principal trust deed dated 12 May 2006 between the Lender and
the Trustee, as may be amended or supplemented from time to time.
‘‘Programme’’ means the programme for the issuance of Notes by the Lender for the purpose of
financing Loans.
‘‘Programme Limit’’ means U.S.$10,000,000,000 or its equivalent in other currencies, being the
maximum aggregate principal amount of Notes that may be issued and outstanding at any time
under the Programme as may be increased in accordance with the Dealer Agreement.
‘‘Put Option’’ means the put option (if applicable) granted to Noteholders pursuant to the
Conditions of a Series of Notes.
‘‘Qualifying Jurisdiction’’ means any jurisdiction in which the Lender or any successor thereto is
entitled to receive payment of interest on any Loan under a double taxation agreement in force on
such date (subject to the completion of any necessary procedural formalities) providing for full
exemption from Russian withholding tax on interest derived from a source within the Russian
Federation to a resident of such jurisdiction.
‘‘Rate of Interest’’ has the meaning assigned to such term in the relevant Loan Supplement.
‘‘Relevant Indebtedness’’ means any Financial Indebtedness which (a) is in the form of or
represented by any bond, note, debenture stock, loan stock, certificate or other debt instrument
which is listed or quoted on any stock exchange; (b) is denominated, payable or optionally payable
in a currency other than roubles; and (c) was initially offered and distributed (as to more than
50 per cent. of the original principal amount of such debt) outside the Russian Federation.
‘‘Relevant Time’’ means, in relation to a payment in a Specified Currency, the time in the principal
financial centre of such Specified Currency and, in relation to a payment in euro, Brussels time.
‘‘Repayment Date’’ means the date specified as such in the relevant Loan Supplement.
‘‘Roubles’’ means the lawful currency of the Russian Federation.
‘‘Same-Day Funds’’ means funds for payment, in the Specified Currency as the Lender may at any
time determine to be customary for the settlement of international transactions in the principal
financial centre of the country of the Specified Currency or, as the case may be, euro funds settled
through the TARGET System or such other funds for payment in euro as the Lender may at any
time determine to be customary for the settlement of international transactions in Brussels of the
type contemplated hereby.
‘‘Sberbank Account’’ means an account in the name of Sberbank as specified in the relevant Loan
Supplement for receipt of Loan funds.
‘‘Series’’ means a series of Notes that (except in respect of the first payment of interest and their
issue price) have identical terms on issue and are expressed to have the same series number.
‘‘Specified Currency’’ means the currency specified as such in the relevant Loan Supplement.
‘‘Subscription Agreement’’ means the agreement specified as such in the relevant Loan Supplement.
‘‘Subsidiary’’ means, with respect to any Person, (i) any corporation, association or other business
entity of which at least 50 per cent. of the total voting power entitled (without regard to the

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      occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is
      at the time owned or controlled, directly or indirectly, by such Person or one or more of the other
      Subsidiaries of such Person (or any combination thereof) and (ii) any partnership (a) the sole
      general partner or the managing general partner of which is such Person or a Subsidiary of such
      person or (b) the only general partners of which are such Person or one or more Subsidiaries of
      such Person (or any combination thereof).
      ‘‘Supplemental Trust Deed’’ means a supplemental trust deed in respect of a Series of Notes which
      constitutes and secures, inter alia, such Series dated the relevant Closing Date and made between
      the Lender and the Trustee (substantially in the form set out in Schedule 9 to the Principal Trust
      Deed).
      ‘‘TARGET System’’ means the Trans-European Automated Real-Time Gross Settlement Express
      Transfer (TARGET) System or any successor thereof.
      ‘‘Taxes’’ means any taxes (including interest or penalties thereon) which are now or at any time
      hereafter imposed, assessed, charged, levied, collected, demanded, withheld or claimed by the
      Russian Federation, Luxembourg (or any Qualifying Jurisdiction in which the Lender or any
      successor is resident for tax purposes) or any Taxing Authority thereof or therein provided,
      however, that for the purposes of this definition the references to Luxembourg shall, upon the
      occurrence of the Relevant Event (as this term is defined in the Trust Deed), be deemed to be
      references to the jurisdiction in which the Trustee is domiciled for tax purposes; and the term
      ‘‘Taxation’’ shall be construed accordingly.
      ‘‘Taxing Authority’’ means any government or political subdivision or territory or provision of any
      government or authority or agency therein or thereof having the power to tax within Russia or
      Luxembourg (or any Qualifying Jurisdiction in which the Lender or any successor is resident for
      tax purposes).
      ‘‘Trust Deed’’ means the Principal Trust Deed as supplemented by the relevant Supplemental Trust
      Deed and specified as such in the relevant Loan Supplement.
      ‘‘Trustee’’ means J.P. Morgan Corporate Trustee Services Limited as trustee under the Trust Deed
      and other trustee or trustees for the time being of such trust deed.
      ‘‘Warranty Date’’ means the date hereof, the date of each Loan Supplement, each Closing Date,
      each date on which the Base Prospectus or any of the Lender Agreements is amended,
      supplemented or replaced.

1.2   Other Definitions
      Unless the context otherwise requires, terms used in this Agreement which are not defined in this
      Agreement but which are defined in the Principal Trust Deed, the Notes, the Agency Agreement,
      the Dealer Agreement or the relevant Loan Supplement shall have the meanings assigned to such
      terms therein.

1.3   Interpretation
      Unless the context or the express provisions of this Agreement otherwise require, the following
      shall govern the interpretation of this Agreement:
      1.3.1    All references to ‘‘Clause’’ or ‘‘sub-Clause’’ are references to a Clause or sub-Clause of
               this Agreement.
      1.3.2    The terms ‘‘hereof,’’ ‘‘herein’’ and ‘‘hereunder’’ and other words of similar import shall
               mean the relevant Loan Agreement as a whole and not any particular part hereof.
      1.3.3    Words importing the singular number include the plural and vice versa.
      1.3.4    All references to ‘‘taxes’’ include all present or future taxes, levies, imposts and duties of
               any nature and the terms ‘‘tax’’ and ‘‘taxation’’ shall be construed accordingly.
      1.3.5    The table of contents and the headings are for convenience only and shall not affect the
               construction hereof.
      1.3.6    All references to ‘‘this Agreement’’ or ‘‘this Facility Agreement’’ are references to this
               Facility Agreement dated 12 May 2006.


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2     Loans
2.1   Loans
      On the terms and subject to the conditions set forth herein and, as the case may be, in each Loan
      Supplement, the Lender hereby agrees to make available to Sberbank Loans in principal amounts
      which, when aggregated with the principal amounts advanced under any Subordinated Loan
      Agreement will not exceed the total aggregate amount equal to the Programme Limit.

2.2   Purpose
      The proceeds of each Loan will be used for general corporate purposes (unless otherwise specified
      in the relevant Loan Agreement), but the Lender shall not be concerned with the application
      thereof.

2.3   Separate Loans
      It is agreed that with respect to each Loan, all the provisions of this Facility Agreement and the
      Loan Supplement shall apply mutatis mutandis separately and independently to each such Loan
      and the expressions ‘‘Account,’’ ‘‘Closing Date,’’ ‘‘Day Count Fraction,’’ ‘‘Interest Commencement
      Date,’’ ‘‘Interest Payment Date,’’ ‘‘Loan Agreement,’’ ‘‘Notes,’’ ‘‘Rate of Interest,’’ ‘‘Repayment
      Date,’’ ‘‘Specified Currency,’’ ‘‘Subscription Agreement’’ and ‘‘Trust Deed,’’ together with all other
      terms that relate to such a Loan shall be construed as referring to those of the particular Loan in
      question and not of all Loans unless expressly so provided, so that each such Loan shall be made
      pursuant to this Facility Agreement and the relevant Loan Supplement, together comprising the
      Loan Agreement in respect of such Loan and that, unless expressly provided, events affecting one
      Loan shall not affect any other.

3     Drawdown
3.1   Drawdown
      On the terms and subject to the conditions set forth herein and, as the case may be, in each Loan
      Supplement, on the Closing Date thereof the Lender shall make a Loan to Sberbank and Sberbank
      shall make a single drawing in the full amount of such Loan.

3.2   One-Time Loan Commission
      In consideration of the Lender’s making a Loan available to Sberbank, Sberbank hereby agrees
      that it shall, two Business Days before each Closing Date, pay to the Lender, in Same-Day Funds
      an amount equal to a one-time commission of the Lender in respect of such Loan in an amount to
      be specified in the relevant Loan Supplement, as supported by an invoice substantially in the form
      set out in Schedule B.

3.3   Disbursement
      Subject to the conditions set forth herein and, as the case may be, in each Loan Supplement, on
      each Closing Date the Lender shall transfer the amount of the relevant Loan to the Sberbank
      Account specified in the relevant Loan Supplement.

4     Interest
4.1   Rate of Interest for Fixed Rate Loans
      Each Fixed Rate Loan bears interest on its outstanding principal amount from (and including) the
      Interest Commencement Date at the rate(s) per annum (expressed as a percentage) equal to the
      applicable Rate of Interest.
      If a Fixed Amount or a Broken Amount is specified in the relevant Loan Supplement, the amount
      of interest payable on each Interest Payment Date will amount to the Fixed Amount or, if
      applicable, the Broken Amount so specified and in the case of the Broken Amount will be payable
      on the particular Interest Payment Date(s) specified in the relevant Loan Supplement.

4.2   Payment of Interest for Fixed Rate Loans
      Interest at the Rate of Interest shall accrue on each Fixed Rate Loan from day to day, starting from
      (and including) the Interest Commencement Date and thereafter from (and including) each

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      Interest Payment Date, in each case to (but excluding) the next Interest Payment Date and shall
      be paid by Sberbank to the Lender in arrear not later than 10:00 a.m. one Business Day prior to
      each Interest Payment Date.

4.3   Interest for Floating Rate Loans
      4.3.1   Interest Payment Dates: Each Floating Rate Loan bears interest on its outstanding
              principal amount from (and including) the Interest Commencement Date and thereafter
              from (and including) each Interest Payment Date, in each case to (but excluding) the next
              Interest Payment Date at the rate per annum (expressed as a percentage) equal to the
              applicable Rate of Interest, such interest shall be paid by Sberbank to the Lender in
              arrear not later than 10:00 a.m. one Business Day prior to each Interest Payment Date.
              Such Interest Payment Date(s) is/are either shown in the relevant Loan Supplement as
              Specified Interest Payment Date(s) or, if no Specified Interest Payment Date(s) is/are
              shown in the relevant Loan Supplement, Interest Payment Date shall mean each date
              which falls the number of months or other period shown in the relevant Loan Supplement
              as the Interest Period after the preceding Interest Payment Date or, in the case of the first
              Interest Payment Date, after the Interest Commencement Date.
      4.3.2   Business Day Convention: If any date referred to in the relevant Loan Supplement that
              is specified to be subject to adjustment in accordance with a Business Day Convention
              would otherwise fall on a day that is not a Business Day, then, if the Business Day
              Convention specified is (A) the Floating Rate Business Day Convention, such date shall
              be postponed to the next day that is a Business Day unless it would thereby fall into the
              next calendar month, in which event (x) such date shall be brought forward to the
              immediately preceding Business Day and (y) each subsequent such date shall be the last
              Business Day of the month in which such date would have fallen had it not been subject
              to adjustment, (B) the Following Business Day Convention, such date shall be postponed
              to the next day that is a Business Day, (C) the Modified Following Business Day
              Convention, such date shall be postponed to the next day that is a Business Day unless
              it would thereby fall into the next calendar month, in which event such date shall be
              brought forward to the immediately preceding Business Day or (D) the Preceding
              Business Day Convention, such date shall be brought forward to the immediately
              preceding Business Day.
      4.3.3   Rate of Interest for Floating Rate Loans: The Rate of Interest in respect of Floating Rate
              Loans for each Interest Accrual Period shall be determined in the manner specified in the
              relevant Loan Supplement and the provisions below relating to either ISDA
              Determination or Screen Rate Determination shall apply, depending upon which is
              specified in the relevant Loan Supplement.
              (i)    ISDA Determination for Floating Rate Loans
                     Where ISDA Determination is specified in the relevant Loan Supplement as the
                     manner in which the Rate of Interest is to be determined, the Rate of Interest for
                     each Interest Accrual Period shall be determined by the Calculation Agent as a
                     rate equal to the relevant ISDA Rate. For the purposes of this sub-paragraph (i),
                     ‘‘ISDA Rate’’ for an Interest Accrual Period means a rate equal to the Floating
                     Rate that would be determined by the Calculation Agent under a Swap Transac-
                     tion under the terms of an agreement incorporating the ISDA Definitions and
                     under which:
                     (a) the Floating Rate Option is as specified in the relevant Loan Supplement;
                     (b) the Designated Maturity is a period specified in the relevant Loan Supplement;
                         and
                     (c) the relevant Reset Date is the first day of that Interest Accrual Period unless
                         otherwise specified in the relevant Loan Supplement.
                     For the purposes of this sub-paragraph (i), ‘‘Floating Rate,’’ ‘‘Calculation Agent,’’
                     ‘‘Floating Rate Option,’’ ‘‘Designated Maturity,’’ ‘‘Reset Date’’ and
                     ‘‘Swap Transaction’’ have the meanings given to those terms in the ISDA
                     Definitions.

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(ii)   Screen Rate Determination for Floating Rate Loans
       (x)   Where Screen Rate Determination is specified in the relevant Loan
             Supplement as the manner in which the Rate of Interest is to be determined,
             the Rate of Interest for each Interest Accrual Period will, subject as
             provided below, be either:
             (a) the offered quotation; or
             (b) the arithmetic mean of the offered quotations,
             (expressed as a percentage rate per annum) for the Reference Rate which
             appears or appear, as the case may be, on the Relevant Screen Page as at
             either 11:00 a.m. (London time in the case of LIBOR or Brussels time in the
             case of EURIBOR) on the Interest Determination Date in question as
             determined by the Calculation Agent. If five or more of such offered
             quotations are available on the Relevant Screen Page, the highest (or, if
             there is more than one such highest quotation, one only of such quotations)
             and the lowest (or, if there is more than one such lowest quotation, one only
             of such quotations) shall be disregarded by the Calculation Agent for the
             purpose of determining the arithmetic mean of such offered quotations.
             If the Reference Rate from time to time in respect of Floating Rate Loans
             is specified in the relevant Loan Supplement as being other than LIBOR or
             EURIBOR, the Rate of Interest in respect of such Loans will be determined
             as provided in the relevant Loan Supplement.
       (y)   if the Relevant Screen Page is not available or if sub-paragraph (x)(a)
             applies and no such offered quotation appears on the Relevant Screen Page
             or if sub-paragraph (x)(b) above applies and fewer than three such offered
             quotations appear on the Relevant Screen Page in each case as at the time
             specified above, subject as provided below, the Calculation Agent shall
             request, if the Reference Rate is LIBOR, the principal London office of
             each of the Reference Banks or, if the Reference Rate is EURIBOR, the
             principal Euro-zone office of each of the Reference Banks, to provide the
             Calculation Agent with its offered quotation (expressed as a percentage
             rate per annum) for the Reference Rate if the Reference Rate is LIBOR,
             at approximately 11:00 a.m. (London time), or if the Reference Rate is
             EURIBOR, at approximately 11:00 a.m. (Brussels time) on the Interest
             Determination Date in question. If two or more of the Reference Banks
             provide the Calculation Agent with such offered quotations, the Rate of
             Interest for such Interest Period shall be the arithmetic mean of such
             offered quotations as determined by the Calculation Agent; and
       (z)   if paragraph (y) above applies and the Calculation Agent determines that
             fewer than two Reference Banks are providing offered quotations, subject
             as provided below, the Rate of Interest shall be either (i) the arithmetic
             mean of the rates per annum (expressed as a percentage) as communicated
             to (and at the request of) the Calculation Agent by the Reference Banks or
             any two or more of them, offered by such Banks, if the Reference Rate is
             LIBOR, at approximately 11:00 a.m. (London time) or, if the Reference
             Rate is EURIBOR, at approximately 11:00 a.m. (Brussels time) on the
             relevant Interest Determination Date, in respect of deposits in the Specified
             Currency for a period equal to that which would have been used for the
             Reference Rate by leading banks in, if the Reference Rate is LIBOR, the
             London inter-bank market or, if the Reference Rate is EURIBOR, the
             Euro-zone inter-bank market, as the case may be, or (ii) if fewer than two
             of the Reference Banks so requested provide the Calculation Agent with
             such offered rates, the offered rate for deposits in the Specified Currency
             for a period equal to that which would have been used for the Reference
             Rate, or the arithmetic mean of the offered rates for deposits in the
             Specified Currency for a period equal to that which would have been used
             for the Reference Rate, at which, if the Reference Rate is LIBOR, at

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                             approximately 11:00 a.m. (London time) or, if the Reference Rate is
                             EURIBOR, at approximately 11:00 a.m. (Brussels time), on the relevant
                             Interest Determination Date, any one or more banks (which bank or banks
                             is or are in the opinion of the Trustee and the Lender suitable for such
                             purpose) informs the Calculation Agent it is quoting to leading banks in, if
                             the Reference Rate is LIBOR, the London inter-bank market or, if the
                             Reference Rate is EURIBOR, the Euro-zone inter-bank market, as the
                             case may be, provided that, if the Rate of Interest cannot be determined in
                             accordance with the foregoing provisions of this paragraph, the Rate of
                             Interest shall be determined as at the last preceding Interest Determination
                             Date (although substituting, where a different Margin or Maximum or
                             Minimum Rate of Interest is to be applied to the relevant Interest Accrual
                             Period from that which applied to the last preceding Interest Accrual
                             Period, the Margin or Maximum or Minimum Rate of Interest relating to
                             the relevant Interest Accrual Period, in place of the Margin or Maximum or
                             Minimum Rate of Interest relating to that last preceding Interest Accrual
                             Period).

4.4   Accrual of Interest
      Interest shall cease to accrue on each Loan on the due date for repayment unless payment is
      improperly withheld or refused, in which event interest shall continue to accrue (as well after as
      before judgment) at the applicable Rate of Interest to but excluding the date on which payment
      in full of the principal thereof is made.

4.5   Margin, Maximum/Minimum Rates of Interest and Rounding
      4.5.1    If any Margin is specified in the relevant Loan Supplement (either (x) generally, or (y) in
               relation to one or more Interest Accrual Periods), an adjustment shall be made to all
               Rates of Interest, in the case of (x), or the Rates of Interest for the specified Interest
               Accrual Periods, in the case of (y), calculated in accordance with sub-Clause 4.3 above by
               adding (if a positive number) or subtracting the absolute value (if a negative number) of
               such Margin, subject always to the next paragraph.
      4.5.2    If any Maximum or Minimum Rate of Interest is specified in the relevant Loan
               Supplement, then any Rate of Interest shall be subject to such maximum or minimum, as
               the case may be.
      4.5.3    For the purposes of any calculations required pursuant to a Loan Agreement (unless
               otherwise specified), (x) all percentages resulting from such calculations shall be rounded,
               if necessary, to the nearest one hundred-thousandth of a percentage point (with halves
               being rounded up), (y) all figures shall be rounded to seven significant figures (with halves
               being rounded up) and (z) all currency amounts that fall due and payable shall be
               rounded to the nearest unit of such currency (with halves being rounded up), save in the
               case of yen, which shall be rounded down to the nearest yen. For these purposes ‘‘unit’’
               means the lowest amount of such currency that is available as legal tender in the country
               or countries of such currency.

4.6   Calculations
      The amount of interest payable in respect of any Loan for any period shall be calculated by
      multiplying the product of the Rate of Interest and the outstanding principal amount of such Loan
      by the Day Count Fraction, unless an Interest Amount (or a formula for its calculation) is specified
      in the relevant Loan Supplement in respect of such period, in which case the amount of interest
      payable in respect of such Loan for such period shall equal such Interest Amount (or be calculated
      in accordance with such formula). Where any Interest Period comprises two or more Interest
      Accrual Periods, the amount of interest payable in respect of such Interest Period shall be the sum
      of the amounts of interest payable in respect of each of those Interest Accrual Periods.

4.7   Determination and Notification of Rates of Interest and Interest Amounts
      The Calculation Agent shall, as soon as practicable on each Interest Determination Date or such
      other time on such date as the Calculation Agent may be required to calculate any rate or amount,

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      obtain any quotation or make any determination or calculation, determine such rate and calculate
      the Interest Amounts in respect of such Floating Rate Loan for the relevant Interest Accrual
      Period, obtain such quotation or make such determination or calculation, as the case may be, and
      cause the Rate of Interest and the Interest Amounts for each Interest Period and the relevant
      Interest Payment Date to be notified to Sberbank, the Lender and any other Calculation Agent
      appointed in respect of such Floating Rate Loan that is to make a further calculation upon receipt
      of such information. Where any Interest Payment Date or Interest Period Date is subject to
      adjustment pursuant to sub-Clause 4.3.2, the Interest Amounts and the Interest Payment Date so
      notified may subsequently be amended (or appropriate alternative arrangements made with the
      consent of Sberbank and the Lender by way of adjustment) without notice in the event of an
      extension or shortening of the Interest Period. If such Floating Rate Loan becomes due and
      payable under Clause 11, the accrued interest and the Rate of Interest payable in respect of such
      Floating Rate Loan shall nevertheless continue to be calculated as previously in accordance with
      this Clause. The determination of any rate or amount, the obtaining of each quotation and the
      making of each determination or calculation by the Calculation Agent(s) shall (in the absence of
      manifest error) be final and binding upon all parties.

4.8   Determination or Calculation by Trustee
      If the Calculation Agent does not at any time for any reason determine or calculate the Rate of
      Interest for an Interest Period or any Interest Amount in relation to a Floating Rate Loan, the
      Lender and Sberbank agree that such determination or calculation may be made by or at the
      direction of the Trustee. The Trustee shall incur no liability in respect of such determination or
      calculation.

4.9   Definitions
      In this Clause 4, unless the context otherwise requires, the following defined terms shall have the
      meanings set out below:
      ‘‘Business Day’’ means:
      (i)     in the case of a currency other than euro, a day (other than a Saturday or Sunday) on which
              commercial banks and foreign exchange markets settle payments in the principal financial
              centre for such currency; and/or
      (ii)    in the case of euro, a day on which the TARGET system is operating (a ‘‘TARGET
              Business Day’’); and/or
      (iii)   in the case of a currency and/or one or more Business Centres a day (other than a Saturday
              or a Sunday) on which commercial banks and foreign exchange markets settle payments in
              such currency in the Business Centre(s) or, if no currency is indicated, generally in each of
              the Business Centres.
      ‘‘Day Count Fraction’’ means, in respect of the calculation of an amount of interest on any Note
      for any period of time (from and including the first day of such period to but excluding the last)
      (whether or not constituting an Interest Period, the ‘‘Calculation Period’’):
      (i)     if ‘‘Actual/365’’ or ‘‘Actual/Actual – ISDA’’ is specified in the relevant Loan Supplement,
              the actual number of days in the Calculation Period divided by 365 (or, if any portion of that
              Calculation Period falls in a leap year, the sum of (A) the actual number of days in that
              portion of the Calculation Period falling in a leap year divided by 366 and (B) the actual
              number of days in that portion of the Calculation Period falling in a non-leap year divided
              by 365);
      (ii)    if ‘‘Actual/365 (Fixed)’’ is specified in the relevant Loan Supplement, the actual number of
              days in the Calculation Period divided by 365;
      (iii)   if ‘‘Actual/360’’ is specified in the relevant Loan Supplement, the actual number of days in
              the Calculation Period divided by 360;
      (iv)    if ‘‘30/360’’, ‘‘360/360’’ or ‘‘Bond Basis’’ is specified in the relevant Loan Supplement, the
              number of days in the Calculation Period divided by 360 (the number of days to be
              calculated on the basis of a year of 360 days with 12 30-day months (unless (a) the last day


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       of the Calculation Period is the 31st day of a month but the first day of the Calculation
       Period is a day other than the 30th or 31st day of a month, in which case the month that
       includes that last day shall not be considered to be shortened to a 30-day month, or (b) the
       last day of the Calculation Period is the last day of the month of February, in which case the
       month of February shall not be considered to be lengthened to a 30-day month));
(v)    if ‘‘30E/360’’ or ‘‘Eurobond Basis’’ is specified in the relevant Loan Supplement, the number
       of days in the Calculation Period divided by 360 (the number of days to be calculated on the
       basis of a year of 360 days with 12 30-day months, without regard to the date of the first day
       or last day of the Calculation Period unless, in the case of a Calculation Period ending on
       the Repayment Date, the Repayment Date is the last day of the month of February, in
       which case the month of February shall not be considered to be lengthened to a 30-day
       month); and
(vi)   if ‘‘Actual/Actual-ICMA’’ is specified in the relevant Loan Supplement:
       (a)      If the Calculation Period is equal to or shorter than the Determination Period during
                which it falls, the number of days in the Calculation Period divided by the product
                of (x) the number of days in such Determination Period and (y) the number of
                Determination Periods normally ending in any year; and
       (b)      if the Calculation Period is longer than one Determination Period, the sum of:
                (I) the number of days in such Calculation Period falling in the Determination
                    Period in which it begins divided by the product of (1) the number of days in
                    such Determination Period and (2) the number of Determination Periods
                    normally ending in any year; and
                (II) the number of days in such Calculation Period falling in the next Determination
                     Period divided by the product of (1) the number of days in such Determination
                     Period and (2) the number of Determination Periods normally ending in any
                     year
       where:
       ‘‘Determination Period’’ means the period from and including a Determination Date in any
       year to but excluding the next Determination Date.
       ‘‘Determination Date’’ means the date specified in the relevant Loan Supplement or, if none
       is so specified, the Interest Payment Date.
‘‘Interest Accrual Period’’ means the period beginning on (and including) the Interest
Commencement Date and ending on (but excluding) the first Interest Period Date and each
successive period beginning on (and including) an Interest Period Date and ending on (but
excluding) the next succeeding Interest Period Date.
‘‘Interest Amount’’ means the amount of interest payable, and in the case of Fixed Rate Loans,
means the Fixed Amount or Broken Amount, as the case may be.
‘‘Interest Determination Date’’ means, with respect to a Rate of Interest and Interest Accrual
Period, the date specified as such in the relevant Loan Supplement or, if none is so specified, (i) the
first day of such Interest Accrual Period if the Specified Currency is Sterling or (ii) the day falling
two Business Days in London and for the Specified Currency prior to the first day of such Interest
Accrual Period if the Specified Currency is neither Sterling nor euro or (iii) the day falling two
TARGET Business Days prior to the first day of such Interest Accrual Period if the Specified
Currency is euro.
‘‘Interest Period Date’’ means each Interest Payment Date unless otherwise specified herein.
‘‘ISDA Definitions’’ means the 2000 ISDA Definitions, as published by the International Swaps
and Derivatives Association, Inc., unless otherwise specified in the relevant Loan Supplement.
‘‘Reference Banks’’ means, in the case of a determination of LIBOR, the principal London office
of four major banks in the London inter-bank market and, in the case of a determination of
EURIBOR, the principal Euro-zone office of four major banks in the Euro-zone inter-bank
market, in each case selected by the Calculation Agent or as specified in the relevant Loan
Supplement.

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       ‘‘Reference Rate’’ means the rate specified as such in the relevant Loan Supplement.
       ‘‘Relevant Screen Page’’ means such page, section, caption, column or other part of a particular
       information service as may be specified in the relevant Loan Supplement.

4.10   Calculation Agent
       The Lender shall procure that there shall at all times be specified one or more Calculation Agents,
       which shall have been approved in advance by Sberbank, if provision is made for them hereon and
       for so long as any amount remains outstanding under a Loan Agreement. Where more than one
       Calculation Agent is appointed in respect of a Loan, references in the relevant Loan Agreement
       to the Calculation Agent shall be construed as each Calculation Agent performing its respective
       duties under the relevant Loan Agreement. If the Calculation Agent is unable or unwilling to act
       as such or if the Calculation Agent fails duly to establish the Rate of Interest for an Interest Period
       or Interest Accrual Period or to calculate any Interest Amount, or to comply with any other
       requirement, the Lender shall (with the prior approval of Sberbank) appoint a leading bank or
       investment banking firm engaged in the interbank market (or, if appropriate, money, swap or
       over-the-counter index options market) that is most closely connected with the calculation or
       determination to be made by the Calculation Agent (acting through its principal London office or
       any other office actively involved in such market) to act as such in its place. The Calculation Agent
       may not resign its duties without a successor having been appointed as aforesaid. Both Sberbank
       and the Lender agree that such successor Calculation Agent will be appointed on the terms of the
       Agency Agreement in relation to each particular Series.

5      Repayment and Prepayment
5.1    Repayment
       Except as otherwise provided herein and in the applicable Loan Supplement, Sberbank shall repay
       each Loan not later than 10:00 a.m. one Business Day prior to the Repayment Date thereof.

5.2    Prepayment for Tax Reasons or Change in Circumstances
       If, as a result of the application of or any amendment or clarification to, or change (including a
       change in interpretation or application), in the double tax treaty between the Russian Federation
       and Luxembourg or the laws or regulations of the Russian Federation or Luxembourg or of any
       political sub-division thereof or any authority therein or the enforcement of the security provided
       for in any Trust Deed, Sberbank would thereby be required to make or increase any payment due
       pursuant to any Loan Agreement as provided in sub-Clauses 6.2 or 6.3 (other than, in each case,
       where the increase in payment is in respect of any amounts due or paid pursuant to Clauses 3.2 and
       13), or if (for whatever reason) Sberbank would have to or has been required to pay additional
       amounts pursuant to Clause 8, and such additional amounts cannot be avoided by Sberbank taking
       reasonable measures available to it, then Sberbank may (without premium or penalty), upon not
       less than 20 nor more than 90 days’ notice to the Lender specifying the date of payment and
       including a certification by the principal officer of Sberbank that Sberbank would be required to
       increase the amount payable or to pay additional amounts, supported by an opinion of an
       independent tax adviser of recognised standing in the relevant tax jurisdiction (which notice shall
       be irrevocable), prepay the relevant Loan in whole (but not in part) at any time.

5.3    Illegality
       If, at any time after the date of the relevant Loan Supplement, by reason of the introduction of,
       or any change in, any applicable law or regulation or regulatory requirement or directive of any
       agency of any state (i) the Lender reasonably determines (such determination being accompanied
       by an Opinion of Counsel satisfactory to Sberbank, with the cost of such Opinion of Counsel being
       borne solely by Sberbank) that it is or would be unlawful or contrary to such applicable law,
       regulation, regulatory requirement or directive for the Lender to allow all or part of the relevant
       Loan or the corresponding Series of Notes to remain outstanding or for the Lender to maintain or
       give effect to any of its obligations in connection with the relevant Loan Agreement and/or to
       charge or receive or to be paid interest at the rate then applicable to such Loan or (ii) Sberbank
       reasonably determines (such determination being accompanied by an Opinion of Counsel
       satisfactory to the Lender, with the cost of such Opinion of Counsel being borne solely by


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      Sberbank) that it is or would be unlawful or contrary to such applicable law, regulation, regulatory
      requirement or directive for Sberbank to borrow any Loan or to allow all or part of any Loan to
      remain outstanding or to give effect to any of its obligations in connection with this Agreement
      and/or to pay interest at the rate then applicable to such Loan, then upon notice by the Lender to
      Sberbank or Sberbank to the Lender, as applicable, in writing (setting out in reasonable detail the
      nature and extent of the relevant circumstances), Sberbank and the Lender shall consult in good
      faith as to a basis which eliminates the application of such circumstances; provided, however, that
      the notifying party (the ‘‘Notifying Party’’) shall be under no obligation to continue such
      consultation if a basis has not been determined within 30 days of the date on which it so notified
      the other party (the ‘‘Notified Party’’). If such a basis has not been determined within the 30 days,
      then upon notice by the Notifying Party to the Notified Party in writing, Sberbank shall prepay
      such Loan in whole (but not in part) on such date as the Notifying Party shall certify to be
      necessary to comply with such requirements.
5.4   Prepayment in the Event of Change of Control
      5.4.1    If, following a Change of Control, any Noteholder has exercised its Put Option, Sberbank
               shall on the Change of Control Payment Date, prepay the principal amount of the
               relevant Loan in an amount which corresponds to the aggregate principal amount of the
               corresponding Series of Notes in relation to which the Put Option has been duly exercised
               in accordance with the Conditions of such Series of Notes.
      5.4.2    Promptly, and in any event within 10 calendar days after the date of any Change of
               Control, Sberbank shall deliver to the Lender a written notice in the form of an Officer’s
               Certificate, which notice shall be irrevocable, stating that a Change of Control has
               occurred and stating the circumstances and relevant facts giving rise to such Change of
               Control.
      5.4.3    The Lender shall notify Sberbank not more than three Business Days after receipt of
               notice thereof from the Paying Agent, the amount of each relevant Loan to be prepaid
               as a consequence of the exercise of the Put Option by any Noteholders.
      5.4.4    For the avoidance of doubt, this sub-Clause 5.4 may be disapplied under the terms of the
               relevant Loan Supplement.
5.5   Reduction of a Loan Upon Redemption and Cancellation of Notes
      Sberbank or any Subsidiary of Sberbank may from time to time, in accordance with the Conditions
      of the Notes, purchase Notes in the open market or by tender or by a private agreement at any
      price. In the event that an amount of Notes is surrendered to the Lender (as issuer of such Notes)
      for cancellation by Sberbank or any of Sberbank’s Subsidiaries and cancelled, the relevant Loan
      shall be deemed to have been prepaid by Sberbank in an amount corresponding to the aggregate
      principal amount of the Notes surrendered to the Lender for cancellation, together with accrued
      interest and other amounts (if any) thereon and no further payment shall be made or required to
      be made by Sberbank in respect of such amounts.
5.6   Payment of Other Amounts; Indemnity
      If a Loan is to be prepaid by Sberbank pursuant to any of the provisions of sub-Clauses 5.2, 5.3,
      5.4 or pursuant to the terms of the relevant Loan Agreement, Sberbank shall, simultaneously with
      such prepayment, pay to the Lender accrued interest (calculated up to but excluding the scheduled
      date of prepayment) and all other sums payable by Sberbank pursuant to the relevant Loan
      Agreement. Sberbank shall indemnify the Lender on demand against all costs reasonably incurred
      and properly documented by the Lender in connection with any prepayment pursuant to this
      Clause 5.
5.7   Provisions Exclusive
      Sberbank may not voluntarily prepay any Loan except in accordance with the express terms of the
      relevant Loan Agreement. Any amount prepaid may not be reborrowed under such Loan
      Agreement.
6     Payments
6.1   Making of Payments
      All payments of principal and interest to be made by Sberbank under each Loan Agreement shall
      be made to the Lender not later than 10:00 a.m. one Business Day prior to each Interest Payment

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      Date or the Repayment Date (as the case may be) in Same-Day Funds to the relevant Account.
      The Lender agrees with Sberbank that it will not deposit any other monies into such Account and
      will not withdraw any amounts from such Account other than as provided for and in accordance
      with the Trust Deed and Agency Agreement.
6.2   No Set-Off, Counterclaim or Withholding; Gross-Up
      All payments to be made by Sberbank under each Loan Agreement shall be made in full without
      set-off or counterclaim and (except to the extent required by law) free and clear of and without
      deduction for or on account of any Taxes. If Sberbank shall be required by applicable law to make
      any deduction or withholding from any payment under a Loan Agreement for or on account of any
      Taxes, any payment due under such Loan Agreement shall be increased to such amount as may be
      necessary to ensure that the Lender receives a net amount in the Specified Currency equal to the
      full amount which it would have received had payment not been made subject to such Taxes, shall
      account to the relevant authorities for the relevant amount of such Taxes so withheld or deducted
      within the time allowed for such payment under the applicable law and shall deliver to the Lender
      without undue delay evidence in the form of a payment order and a letter signed by the principal
      executive officer of Sberbank (or such other evidence as the parties, acting reasonably, may
      mutually agree) of such deduction or withholding and evidence of the accounting therefor to the
      relevant Taxing Authority. If the Lender pays any amount in respect of such Taxes, Sberbank shall
      reimburse the Lender in the Specified Currency for such payment on demand on the basis of an
      invoice substantially in the form set out in Schedule B to this Agreement. For the avoidance of
      doubt, this sub-Clause 6.2 is without prejudice to the obligations of the Lender pursuant to
      sub-Clauses 6.5 and 6.6. The provisions of this sub-Clause 6.2 shall not apply to any tax imposed
      on and calculated by reference to the overall net income of the Lender.
6.3   Tax Indemnity
      If the Lender notifies Sberbank (setting out in reasonable detail the nature and extent of the
      obligation with such evidence as Sberbank may reasonably require) that it has become obliged to
      make any withholding or deduction for or on account of any Taxes from any payment which it is
      obliged to make in connection with its funding of any Loan, Sberbank agrees to pay to the Lender,
      not later than 10:00 a.m. one Business Day prior to the date on which payment by the Lender is
      due in Same-Day Funds to the relevant Account, such additional amounts as are equal to the said
      additional amounts which the Lender must pay in connection with the funding of any Loan,
      however, that immediately upon receipt by the Lender of any sums paid pursuant to this provision,
      to the extent that any party connected to the funding of the Loan (other than the Lender) is not
      entitled to such additional amounts, the Lender shall repay such additional amounts to Sberbank
      (it being understood that the Lender (or any successor thereto) shall have no obligation to
      determine whether any such party is entitled to such additional amount).
6.4   Reimbursement
      To the extent that the Lender subsequently obtains or uses any tax credit, relief or allowance or
      other reimbursements relating to a deduction or withholding with respect to which Sberbank has
      made a payment pursuant to this Clause 6 or obtains any other reimbursement in connection
      therewith, it shall pay to Sberbank so much of the benefit received as will leave the Lender, in its
      reasonable opinion, substantially the same position as it would have been had no additional
      amount been required to be paid by Sberbank pursuant to this Clause 6 or had no reimbursement
      been paid to the Lender; provided, however, that the question of whether any such benefit has been
      received, and accordingly, whether any payment should be made to Sberbank, the amount of any
      such payment and the timing of any such payment, shall be determined solely by the Lender. The
      Lender shall have the absolute discretion whether, and in what order and manner, it claims any
      credits or refunds available to the Lender but shall not be obliged to disclose to Sberbank any
      information regarding its tax affairs or computations provided that the Lender shall notify
      Sberbank of any tax credit or allowance or other reimbursement it receives. Any such refund or
      reimbursement shall, in the absence of manifest error and subject to the Lender specifying in
      writing in reasonable detail the calculation of such credit, relief, allowance, refund or other
      reimbursement and of such payment and providing relevant supporting documents evidencing such
      matters, be conclusive evidence of the amount due to Sberbank hereunder and shall be accepted
      by Sberbank in full and final settlement of its rights of reimbursement under any Loan Agreement
      in respect of such deduction or withholding.

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      If as a result of a failure to obtain relief from deduction or withholding of any tax imposed by
      Russia or any Qualifying Jurisdiction (i) such tax is deducted or withheld by Sberbank and
      pursuant to this Clause 6 an increased amount is paid by Sberbank to the Lender in respect of such
      deduction or withholding and (ii) following the deduction or withholding of tax as referred to
      above the Lender applies to the relevant Russian or Qualifying Jurisdiction tax authorities for a tax
      refund and such tax refund is credited by the Russian or Qualifying Jurisdiction tax authorities to
      a bank account of the Lender, the Lender shall as soon as reasonably possible notify Sberbank of
      the receipt of such tax refund and promptly transfer the entire amount of the tax refund to a bank
      account of Sberbank specified for that purpose by Sberbank. Sberbank agrees to use its reasonable
      endeavours to assist the Lender in making such an application.

6.5   Residency Certificate
      (a)    The Lender (and any successor thereto) shall seek to provide to Sberbank prior to the
             payment of the commission pursuant to Clause 3.2, and in any event shall provide, no later
             than 10 Business Days before the first Interest Payment Date with respect to the first Loan
             made pursuant to this Agreement (and thereafter as soon as possible at the beginning of
             each calendar year but not later than 10 Business Days prior to the first Interest Payment
             Date in that year) with the certificate, issued and certified by the competent Qualifying
             Jurisdiction authorities, as the case may be, confirming that the Lender (or such successor)
             is resident in a Qualifying Jurisdiction. Such certificate shall be appropriately apostilled.
      (b)    Sberbank and the Lender shall provide that, should the Russian legislation regulating the
             procedure for obtaining an exemption from Russian income tax withholding change then
             the procedure referred to in the above paragraph will be deemed changed accordingly.

6.6   Delivery of Forms
      The Lender (or any successor thereto) shall within 30 days of the request of Sberbank (to the
      extent it is able to do so under applicable law including Russian laws) deliver to Sberbank such
      other information or forms, including a power of attorney in form and substance acceptable to
      Sberbank authorising it to file the certificate on behalf of the Lender (or its successor) with the
      relevant tax authority, as may need to be duly completed and delivered by the Lender (or its
      successor) to enable Sberbank to obtain relief from deduction or withholding of Russian Taxes or,
      as the case may be, to obtain a tax refund if a relief from deduction or withholding of Russian Taxes
      has not been obtained. If required, the other forms referred to in this Clause 6.6 shall be duly
      signed by the Lender (or its successor) and stamped or otherwise approved by the competent tax
      authority in the Qualifying Jurisdiction and the power of attorney shall be duly signed and
      apostilled or otherwise legalised. If a relief from deduction or withholding of Russian tax or a tax
      refund under this Clause 6 has not been obtained and further to an application of Sberbank to the
      relevant Russian tax authorities the latter requests the Lender’s rouble bank account details, the
      Lender shall at the request of Sberbank (a) use reasonable efforts to procure that such rouble bank
      account of the Lender is duly opened and maintained, and (b) thereafter furnish Sberbank with the
      details of such rouble bank account. Sberbank shall provide the Lender with all assistance it may
      reasonably require to ensure that the Lender can obtain the certificate referred to in Clause 6.5 and
      deliver the certificate and complete and deliver the other information or forms specified in this
      Clause 6.6.

6.7   Mitigation
      If at any time either party hereto becomes aware of circumstances which would or might, then or
      thereafter, give rise to an obligation on the part of Sberbank to make any deduction, withholding
      or payment as described in sub-Clauses 5.2, 6.2 or 6.3, then, without in any way limiting, reducing
      or otherwise qualifying the Lender’s rights, or Sberbank’s obligations, under such Clauses, such
      party shall promptly upon becoming aware of such circumstances notify the other party, and,
      thereupon the parties shall consider and consult with each other in good faith with a view to
      finding, agreeing upon and implementing a method or methods by which any such obligation may
      be avoided or mitigated and, to the extent that both parties can do so without taking any action
      which in the reasonable opinion of such party is prejudicial to its own position, take such
      reasonable steps as may be reasonably available to it to avoid such obligation or mitigate the effect
      of such circumstances, including in the case of the Lender (without limitation) by the transfer of

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      its rights or obligations under any Loan Agreement to another lender, provided that the Lender
      shall be under no obligation to take any such action if, in its reasonable opinion, to do so would
      have any adverse effect upon its business, operations or financial condition or would be in breach
      of any arrangements which it may have made in respect of the Notes or otherwise.

7     Conditions Precedent and Reports
7.1   Documents to be Delivered
      The obligation of the Lender to make each Loan shall be subject to the receipt by the Lender on
      or prior to the relevant Closing Date of evidence that the persons mentioned in sub-Clauses 14.9.6
      and 14.9.7 hereof have agreed to receive process in the manner specified therein.

7.2   Further Conditions
      The obligation of the Lender to make each Loan shall be subject to the further conditions
      precedent that as of the relevant Closing Date (a) the Lender shall have received the full amount
      of the proceeds of the issue of the corresponding Series of Notes pursuant to the relevant
      Subscription Agreement and (b) the Lender shall have received in full the amount referred to in
      sub-Clause 3.2, if due and payable, above, as specified in the relevant Loan Supplement.

7.3   Reports
      So long as any amount remains outstanding under a Loan Agreement:
      7.3.1     Sberbank will furnish to the Lender commencing with the year ending 31 December 2006,
                within nine months of the relevant year-end audited annual financial statements prepared
                in accordance with IFRS as consistently applied and in English, including a report
                thereon by Sberbank’s certified independent accountants.
      7.3.2     Within 10 days of a request by the Lender, Sberbank shall deliver to the Lender a written
                notice in the form of an Officer’s Certificate stating whether any Potential Event of
                Default or Event of Default has occurred and, if it has occurred and shall be continuing,
                what action Sberbank is taking or proposes to take with respect thereto.
      7.3.3     Sberbank will, as soon as practicable following a request of the Lender, provide the
                Lender with such further information, other than information which Sberbank determines
                in good faith to be confidential, about the business and financial condition of Sberbank
                and its Subsidiaries as the Lender may reasonably request (including information referred
                to in sub-Clauses 14.5 and 14.12 of the Principal Trust Deed).
      7.3.4     Sberbank consents that any information provided to the Lender pursuant to this
                sub-Clause 7.3 may also be provided to the Trustee without violating any duty of
                confidentiality or secrecy that the Lender may owe to Sberbank under the laws of
                Luxembourg.
      7.3.5     Sberbank will at the same time as delivering its audited annual financial statements
                pursuant to sub-Clause 7.3.1 and within 10 days of a request from the Lender, deliver to
                the Lender an Officer’s Certificate specifying those Subsidiaries which were at a date no
                more than 10 days before the date of such Officer’s Certificate, Principal Subsidiaries.

8     Change in Law or Increase in Cost
8.1   Compensation
      If after the date of a Loan Agreement, by reason of (a) any Change of Law and/or (b) change of
      any regulatory requirement or official directive (whether or not having the force of law but, if not
      having the force of law, the observance of which is in accordance with the generally accepted
      financial practice of similar companies in the country concerned) or in the interpretation or
      application thereof by any person charged with the administration thereof:
      (a)     the Lender incurs an additional cost as a result of the Lender’s entering into or performing
              its obligations (including its obligation to make, fund or maintain such Loan) under such
              Loan Agreement other than any such cost incurred as a result of any increase in the rate of
              tax payable by the Lender on its income or as a result of any taxes, withholding or
              deduction, as the case may be referred to in Clause 6.2 or 6.3; or

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      (b)     the Lender becomes liable to make any additional payment on account of tax or otherwise
              on or calculated by reference to the amount of such Loan and/or to any sum received or
              receivable by it hereunder other than any such tax on the Lender’s income or any tax,
              withholding or deduction as the case may be referred to in Clause 6.2 or 6.3;
      then Sberbank shall, on demand of the Lender, pay to the Lender amounts sufficient to hold
      harmless and indemnify it from and against, as the case may be, such properly documented (1) cost
      or (2) liability, provided that the Lender will not be entitled to indemnification where such
      additional cost or liability arises as a result of the gross negligence, fraud or wilful default of the
      Lender.

8.2   Increased Costs Claims
      If the Lender intends to make a claim pursuant to Clause 8.1, it shall promptly notify Sberbank
      thereof and provide a description in writing in reasonable detail of the relevant reason (as
      described in Clause 8.1), including a description of the relevant affected jurisdiction or country and
      the date on which the change in circumstances took effect. This written description shall
      demonstrate the connection between the change in circumstance and the additional costs and shall
      be accompanied by relevant supporting documents evidencing the matters described therein,
      provided that nothing herein shall require the Lender to disclose any confidential information.

8.3   Mitigation
      In the event that the Lender becomes entitled to make a claim pursuant to Clause 8.1, the Lender
      shall consult in good faith with Sberbank and shall use reasonable efforts (based on the Lender’s
      reasonable interpretation of any relevant tax, law, regulation, requirement, official directive,
      request, policy or guideline) to reduce, in whole or in part, Sberbank’s obligations to pay any
      additional amount pursuant to such Clause, including by the transfer of its rights or obligations
      under any Loan Agreement to another lender, except that nothing in this Clause 8.3 shall obligate
      the Lender to incur any costs in taking any action which, in the reasonable opinion of the Lender,
      may be prejudicial to its interests.

9     Representations and Warranties

9.1   Sberbank’s Representations and Warranties
      Sberbank does, and on each Warranty Date (unless expressly stated otherwise) shall be deemed to,
      represent and warrant to the Lender as follows, to the intent that such shall form the basis of each
      Loan Agreement:
      9.1.1     Sberbank is duly organised and incorporated and validly existing under the laws of the
                Russian Federation and has the power and legal right to own its property, to conduct its
                business as currently conducted and to enter into and to perform its obligations under
                each Loan Agreement and to borrow Loans; Sberbank has taken all necessary corporate,
                legal and other action required to authorise the borrowing of Loans on the terms and
                subject to the conditions of each Loan Agreement and to authorise the execution and
                delivery of each Loan Agreement and all other documents to be executed and delivered
                by it in connection with each Loan Agreement, and the performance of each Loan
                Agreement in accordance with its terms.
      9.1.2     The Loan Agreement, including each Loan Supplement in relation thereto, has been duly
                executed and delivered by Sberbank and constitutes a legal, valid and binding obligation
                of Sberbank enforceable in accordance with its terms, subject to applicable bankruptcy,
                insolvency, moratorium and similar laws affecting creditors’ rights generally, and subject,
                as to enforceability, (i) to general principles of equity (regardless of whether enforcement
                is sought in a proceeding in equity or at law); (ii) with respect to the enforceability of a
                judgment whether there is a federal law or a treaty in force relating to the mutual
                recognition of foreign judgments; and (iii) to the fact that certain gross-up and indemnity
                provisions may not be enforceable under Russian law.
      9.1.3     The execution, delivery and performance of each Loan Agreement, including each Loan
                Supplement in relation thereto, by Sberbank will not conflict with or result in any breach
                or violation of (i) any law or regulation or any order of any governmental, judicial or


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         public body or authority in the Russian Federation, (ii) the constitutive documents, rules
         and regulations of Sberbank or (iii) any agreement or other undertaking or instrument to
         which Sberbank is a party or which is binding upon Sberbank or any of its assets, nor
         result in the creation or imposition of any Encumbrance on any of its assets pursuant to
         the provisions of any such agreement or other undertaking or instrument.
9.1.4    All consents, authorisations or approvals or other orders of, or filings with, any
         governmental, judicial, regulatory or public body, administrative agency or other
         governmental body of Russia or any other relevant jurisdiction required by Sberbank in
         connection with the execution, delivery, performance, legality, validity, enforceability and
         admissibility in evidence of each Loan Agreement (subject to a Russian legal requirement
         to provide to a Russian court a duly certified translation thereof into Russian) and the
         issue and offering of each Series of Notes have been obtained or effected and are in full
         force and effect.
9.1.5    No event has occurred that constitutes, or that, with the giving of notice or the lapse of
         time, or both, would, to the best of Sberbank’s knowledge, constitute, an Event of Default
         or a default under any agreement or instrument evidencing any Financial Indebtedness of
         Sberbank, and no such event will occur upon the making of the relevant Loan.
9.1.6    There are no judicial, arbitral or administrative actions, proceedings or claims pending or,
         to the knowledge of Sberbank, threatened, against Sberbank or any of its Principal
         Subsidiaries, the adverse determination of which could have a Material Adverse Effect.
9.1.7    Sberbank’s obligations under each Loan rank at least pari passu with all its other
         unsecured and unsubordinated Financial Indebtedness (apart from any obligations
         mandatorily preferred by law).
9.1.8    The IFRS Financial Statements for the two preceding financial years were prepared in
         accordance with IFRS current as at the date thereof, except where specifically stated
         otherwise therein, and give (in conjunction with the notes thereto) a true and fair view of
         the financial condition of the Group at the date as of which they were prepared and the
         results of the Group’s operations during the financial years or periods then ended.
9.1.9    There has been no material adverse change to the condition (financial or otherwise),
         prospects, results of operations or general affairs of Sberbank or the Group taken as a
         whole since the date of the IFRS Financial Statements.
9.1.10   The execution, delivery and enforceability of each Loan Agreement is not subject to any
         tax, duty, fee or other charge, including, without limitation, any registration or transfer
         tax, stamp duty or similar levy, imposed by or within the Russian Federation or any
         political subdivision or taxing authority thereof or therein (other than state duty paid on
         any claim filed with a Russian court).
9.1.11   Neither Sberbank nor its property has any right of immunity from suit, execution,
         attachment or other legal process on the grounds of sovereignty or otherwise in respect
         of any action or proceeding relating in any way to any Loan Agreement.
9.1.12   Sberbank is in compliance in all respects with all applicable provisions of law except
         where failure to be so in compliance would not have a Material Adverse Effect.
9.1.13   Neither Sberbank, nor any of its Principal Subsidiaries, has taken any corporate action
         nor, to the best of the knowledge and belief of Sberbank, have any other steps been taken
         or legal proceedings started or threatened in writing against Sberbank or any of its
         Principal Subsidiaries for its or their bankruptcy, winding-up, dissolution, external
         administration or re-organisation (whether by voluntary arrangement, scheme of
         arrangement or otherwise) or for the appointment of a receiver, administrator,
         administrative receiver, conservator, custodian, trustee or similar officer of it or of any or
         all of its or their assets or revenues.
9.1.14   There are no strikes or other employment disputes against Sberbank which are pending
         or, to Sberbank’s knowledge, threatened in writing which could have a Material Adverse
         Effect.



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      9.1.15   In any proceedings taken in the Russian Federation in relation to any Loan Agreement,
               the choice of English law as the governing law of any such Loan Agreement and any
               arbitration award obtained in England pursuant to sub-Clause 14.9.4 in relation to any
               Loan Agreement will be recognised and enforced in the Russian Federation after
               compliance with the applicable procedural rules and all other legal requirements in
               Russia.
      9.1.16   As of the date of each Loan Supplement and Closing Date (though not on any of the
               other dates included in the definition of Warranty Date) and subject to sub-Clauses 6.5 or
               6.6, under the laws of the Russian Federation, it will not be required to make any
               deduction or withholding from any payment it may make hereunder.
      9.1.17   Its execution of each Loan Agreement will constitute, and its exercise of its rights and
               performance of its obligations thereunder will constitute, private and commercial acts
               done and performed for private and commercial purposes.
      9.1.18   It has no overdue tax liabilities which could have a Material Adverse Effect other than
               those which it has disclosed to the Lender prior to the date of the relevant Loan or which
               it is contesting in good faith.
      9.1.19   All licences, consents, examinations, clearances, filings, registrations and authorisations
               which are necessary to enable Sberbank and any of its Principal Subsidiaries to own its
               assets and carry on its business are in full force and effect where the absence of such could
               not have a Material Adverse Effect.

9.2   Lender’s Representations and Warranties
      The Lender represents and warrants to Sberbank as follows:
      9.2.1    The Lender is duly incorporated under the laws of Luxembourg and has full power and
               capacity to execute the Lender Agreements and to undertake and perform the obligations
               expressed to be assumed by it herein and therein and the Lender has taken all necessary
               action to approve and authorise the same.
      9.2.2    The execution of the Lender Agreements and the undertaking and performance by the
               Lender of the obligations expressed to be assumed by it herein and therein will not
               conflict with, or result in a breach of or default under, the laws of Luxembourg or the
               constitutive documents, rules and regulations of the Lender or any agreement or
               instrument to which it is a party or by which it is bound or in respect of indebtedness in
               relation to which it is a surety.
      9.2.3                             ´´
               The Lender (i) is a societe anonyme which is a resident of Luxembourg, is subject to
               taxation in Luxembourg on the basis of its registration as a legal entity, location of its
               management body or another similar criterion and it is not subject to taxation in
               Luxembourg merely on income from sources in Luxembourg or connected with property
               located in Luxembourg, and (ii) does not have a permanent establishment in Russia. The
               Lender (or any successor thereto) shall, immediately upon becoming aware of such,
               notify Sberbank if it ceases to be a resident of Luxembourg.
      9.2.4    The Lender Agreements constitute legal, valid and binding obligations of the Lender,
               each enforceable against the Lender in accordance with its terms, except that the
               enforcement thereof may be subject to bankruptcy, insolvency, fraudulent conveyance,
               reorganisation, moratorium and other similar laws relating to or affecting creditors’ rights
               generally, and general equitable principles.
      9.2.5    All authorisations, consents and approvals required by the Lender for or in connection
               with the execution of the Lender Agreements and the performance by the Lender of the
               obligations expressed to be undertaken by it herein and therein have been obtained and
               are in full force and effect.

10    Negative Pledge
      So long as any amount remains outstanding under a Loan Agreement, neither Sberbank nor any
      Principal Subsidiary will create or permit to subsist any Encumbrance (other than any Encumbrance
      upon, or with respect to, any present or future assets or revenues or any part thereof which is

                                                   113
       created pursuant to any securitisation, asset-backed financing or like arrangement, and whereby all
       payment obligations secured by such Encumbrance, or having the benefit of such Encumbrance,
       are to be discharged solely from such assets or revenues, provided that such Encumbrances shall
       not be incurred if that would result in the principal amount of such encumbered Relevant
       Indebtedness exceeding 15 per cent. of Sberbank’s total assets (as reported in its most recent
       financial statements prepared under IFRS)) upon or in respect of any of its undertakings, property,
       income, assets or revenues, present or future, to secure any Relevant Indebtedness unless, at the
       same time or prior thereto, Sberbank’s obligations hereunder are secured equally and rateably
       therewith or benefit from such other security or other arrangements, as the case may be, in each
       case to the satisfaction of the Trustee.

11     Events of Default
11.1   Events of Default
       If one or more of the following events of default (each, an ‘‘Event of Default’’) shall occur and be
       continuing, the Lender shall be entitled to the remedies set forth in sub-Clause 11.3:
       11.1.1   Sberbank fails to pay within five Business Days any amount payable under a Loan
                Agreement as and when such amount becomes payable in the currency and in the manner
                specified therein.
       11.1.2   Sberbank fails to perform or observe any of its other obligations under a Loan
                Agreement and (except where in any such case that failure is not capable of remedy when
                no such notices as is hereinafter mentioned will be required) that failure continues for the
                period of 30 days (or such longer period as the Lender may permit) next following the
                submission by the Lender to Sberbank of notice in writing requesting the same to be
                remedied.
       11.1.3   Any representation or warranty of Sberbank or any certificate or notice delivered to the
                Lender in connection with such Loan Agreement proves to have been inaccurate,
                incomplete or misleading in any material respect at the time it was made or repeated or
                deemed to have been made or repeated if not remedied within 30 days.
       11.1.4   (i) Sberbank or any Principal Subsidiary fails to pay any of its Financial Indebtedness as
                and when such Financial Indebtedness becomes payable, taking into account any
                applicable grace period or (ii) any Financial Indebtedness becomes due and payable prior
                to its stated maturity otherwise than at the option of Sberbank or such Principal
                Subsidiary or (provided that no event of default, howsoever described, has occurred) any
                person or entity entitled to such Financial Indebtedness; provided, that the total amount
                of such Financial Indebtedness unpaid or capable of being accelerated exceeds the lower
                of 3 per cent. of Sberbank’s total shareholders’ equity determined in accordance with
                IFRS (as calculated by reference to Sberbank’s most recent IFRS Financial Statements),
                or U.S.$100,000,000 (or its equivalent in another currency).
       11.1.5   Sberbank or any Principal Subsidiary commences negotiations with a significant portion
                of its creditors with a view to the general readjustment or rescheduling of its indebtedness
                or makes a general assignment for the benefit of or a composition with a significant
                portion of its creditors; provided that the same could have a Material Adverse Effect.
       11.1.6   The occurrence of any of the following events: (i) Sberbank or any Principal Subsidiary
                fails or is unable to pay its debts generally as they become due; (ii) revocation of the
                general banking licence of Sberbank or any Principal Subsidiary; (iii) Sberbank or any
                Principal Subsidiary seeking or consenting to the introduction of proceedings for its
                liquidation or the appointment of a liquidation committee (likvidatsionnaya komissiya) or
                a similar officer of Sberbank or such Principal Subsidiary or any analogous procedure or
                event in any other relevant jurisdiction; (iv) the institution of the supervision
                (nablyudeniye), external management (vneshneye upravleniye) or bankruptcy management
                (konkursnoye proizvodstvo) of any Principal Subsidiary, as such terms are defined in the
                Federal Law of Russia No. 127-FZ ‘‘On Insolvency (Bankruptcy)’’ of 26 October 2002 (as
                amended or replaced from time to time) or any analogous procedure or event in any
                other relevant jurisdiction; (v) the institution of the financial rehabilitation (finansovoye
                ozdorovleniye), pursuant to the request of the Central Bank of Russia, temporary

                                                   114
                administration (vremennaya upravleniye), bankruptcy management (konkursnoye
                proizvodstvo) or reorganisation (reorganizatsiya) with respect to Sberbank or any
                Principal Subsidiary as such terms are defined in the Federal Law of the Russian
                Federation No. 40-FZ ‘‘On Insolvency (Bankruptcy) of Credit Organisations’’ dated
                25 February 1999 (as amended or replaced from time to time) or any analogous
                procedure or event in any other relevant jurisdiction; (vi) any judicial liquidation,
                dissolution, administration or winding-up in respect of Sberbank or any Principal
                Subsidiary; or (vii) the shareholders of Sberbank or any Principal Subsidiary approving
                any plan of dissolution, administration or winding-up of Sberbank or such Principal
                Subsidiary.
       11.1.7   Any governmental authorisation necessary for the performance of any obligation of
                Sberbank under a Loan Agreement fails to be in full force and effect.
       11.1.8   Any governmental authority or court takes any action (including the declaration of a
                moratorium) that has a material adverse effect on Sberbank’s ability to perform its
                obligations under a Loan Agreement or the validity or enforceability of a Loan
                Agreement or the rights or remedies of the Lender under a Loan Agreement.
       11.1.9   Any execution or distress is levied against, or an encumbrancer takes possession of the
                assets of Sberbank having a fair market value exceeding the lower of 3 per cent. of
                Sberbank’s total shareholders’ equity determined in accordance with IFRS (as calculated
                by reference to Sberbank’s most recent IFRS Financial Statements), or U.S.$100,000,000,
                or the equivalent thereof in any other currency or currencies, or any event occurs which
                under the laws of any jurisdiction has a similar or analogous effect unless such execution,
                distress, enforcement of an Encumbrance or similar or analogous event is being contested
                in good faith by Sberbank and is not removed, paid out, stayed or discharged within
                45 days of such execution, distress being levied, taking of possession or similar or
                analogous act, as the case may be.
       11.1.10 The aggregate amount of unsatisfied final judgments, decrees or orders of courts of
               competent jurisdiction or other appropriate and competent law-enforcement bodies for
               the payment of money against Sberbank and its Principal Subsidiaries in the aggregate
               exceeds the lower of 3 per cent. of Sberbank’s total shareholders’ equity determined in
               accordance with IFRS (as calculated by reference to Sberbank’s most recent IFRS
               Financial Statements), or U.S.$100,000,000, or the equivalent thereof in any other
               currency or currencies, and there is a period of 45 days following the entry thereof during
               which such judgment, decree or order is not appealed, discharged, waived or the
               execution thereof stayed and such default continues for ten days after the notice specified
               in sub-Clause 11.2.
       11.1.11 Any seizure, compulsory acquisition, expropriation, nationalisation or renationalisation
               without appropriate compensation after the date of a Loan Agreement by or under the
               authority of a government authority of all or part (the IFRS book value of which is 15 per
               cent. or more of the book value of the whole) of the assets of Sberbank or any Principal
               Subsidiary.
       11.1.12 Sberbank or any of its Principal Subsidiaries ceases to carry on the principal business it
               carries on at the date of a Loan Agreement.
       11.1.13 At any time it is or becomes unlawful for Sberbank to perform or comply with any or all
               of its obligations under a Loan Agreement or any of such obligations (subject as provided
               in sub-Clause 9.1.2) are not, or cease to be, legal, valid, binding and enforceable.
       11.1.14 Any event occurs which under the laws of any relevant jurisdiction has an analogous
               effect to any of the events referred to in any of the foregoing paragraphs.
11.2   Notice of Default
       Sberbank shall deliver to the Lender and the Trustee, within 30 days after becoming aware thereof,
       written notice of any event which is a Potential Event of Default or an Event of Default, its status
       and what action Sberbank is taking or proposes to take with respect thereto.
11.3   Default Remedies
       If any Event of Default shall occur and be continuing, the Lender may, by notice in writing to
       Sberbank, (a) declare the obligations of the Lender under the relevant Loan Agreement to be

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       immediately terminated, whereupon such obligations shall terminate, and (b) declare all amounts
       payable under such Loan Agreement by Sberbank that would otherwise be due after the date of
       such termination to be immediately due and payable, whereupon all such amounts shall become
       immediately due and payable, all without diligence, presentment, demand of payment, protest or
       notice of any kind, which are all expressly waived by Sberbank; provided, however, that if any
       event of any kind referred to in sub-Clauses 11.1.6 or 11.1.13 occurs, the obligations of the Lender
       under such Loan Agreement shall immediately terminate, and all amounts payable under such
       Loan Agreement by Sberbank that would otherwise be due after the occurrence of such event shall
       become immediately due and payable, all without diligence, presentment, demand of payment,
       protest or notice of any kind, which are all especially waived by Sberbank.

11.4   Rights Not Exclusive
       The rights and remedies provided for in each Loan Agreement are cumulative to the extent permitted
       by law and are not exclusive of any other rights, powers, privileges or remedies provided by law.

12     Indemnity
12.1   Indemnification
       Sberbank undertakes to indemnify the Lender and each director, officer, employee or agent (other
       than the Principal Paying Agent or any of the Paying Agents) of the Lender (each an ‘‘Indemnified
       Party’’) against any reasonably incurred and properly documented cost, claim, loss, expense
       (including, without limitation, legal fees and expenses and any amount payable by the Lender in
       connection with its funding of any Loan) or liability (but excluding any such cost, claim, loss,
       expense or liability that is the subject of the undertakings contained in Clause 13 and sub-Clauses
       14.2 and 14.6 of this Agreement) (together, a ‘‘Loss’’), together with any Russian taxes thereon,
       which an Indemnified Party may sustain or incur as a consequence of the occurrence of any Event
       of Default, Potential Event of Default or any other default by Sberbank in the performance of any
       of the obligations expressed to be assumed by it in this Agreement except to the extent that such
       Loss was due to gross negligence, wilful default, bad faith or fraud of the Lender. Except as
       expressly provided in any Trust Deed, the Lender shall not have any duty or obligation, whether
       as fiduciary or trustee, for any Indemnified Party or otherwise, to recover any such payment or to
       account to any other person for any amounts paid to it under this Clause 12.1.
       For the purposes of this Clause 12.1 a Loss shall be regarded as properly documented if it is
       supported by an itemised invoice from the Lender to Sberbank, on the headed paper of the Lender
       and signed by an authorised officer of the Lender, supported, to the extent available, by
       documented evidence of the respective Loss.

12.2   Independent Obligation
       Sub-Clause 12.1 constitutes a separate and independent obligation of Sberbank from its other
       obligations under or in connection with each Loan Agreement or any other obligations of
       Sberbank in connection with its receipt of any Loan and shall not affect, or be construed to affect,
       any other provision of a Loan Agreement or any such other obligations.

12.3   Evidence of Loss
       An itemised invoice, as described in sub-Clause 12.1, shall be prima facie evidence of the amount
       of such Loss.

12.4   Lender’s Costs
       Sberbank shall, from time to time on demand of the Lender, and without prejudice to the
       provisions of Clauses 13.1 and 13.2, compensate the Lender in the Specified Currency at such daily
       and/or hourly rates as the Lender shall from time to time reasonably determine (notifying such
       rates to Sberbank), for all costs (including telephone, fax, copying, travel and such personnel costs)
       reasonably incurred and properly documented by the Lender in connection with its taking such
       action as it may deem appropriate or in complying with any request by Sberbank in connection
       with:
       12.4.1   the granting or proposed granting of any waiver or consent requested hereunder by
                Sberbank;

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       12.4.2    any actual breach by Sberbank of its obligations hereunder; or
       12.4.3    any amendment or proposed amendment hereto requested by Sberbank; provided that
                 before such payment is made by Sberbank, the Lender shall submit an invoice,
                 substantially in the form set out in Schedule B, providing, in reasonable detail, the nature
                 and calculation of the relevant payment. Subsequently, Sberbank and the Lender shall
                 enter and sign an Act of Acceptance as provided in sub-Clause 13.3.

12.5   Survival
       The obligations of Sberbank pursuant to sub-Clauses 6.2, 6.3 and 12.1 shall survive the execution
       and delivery of each Loan Agreement and the drawdown and repayment of the relevant Loan, in
       each case by Sberbank.

13     Commission
13.1   One-Time Commission for the Extension of the Loan by the Lender
       Sberbank shall, pursuant to sub-Clause 3.2 hereof and the relevant Loan Supplement, pay the
       Lender a one-time commission of the Lender in connection with the extension of each Loan, in the
       Specified Currency, as supported by an invoice substantially in the form set out in Schedule B.

13.2   Payment of Ongoing Commissions and Costs
       In addition, Sberbank hereby agrees to pay to the Lender on demand in the Specified Currency all
       ongoing commissions and costs (including, without limitation, enforcement costs), payable by the
       Lender under or in respect of the Lender Agreements. Sberbank shall also pay the Lender for any
       indemnification or other payment obligations of the Lender related to the funding of any Loan
       (other than the obligation of the Lender to make payments of principal, interest or additional
       amounts in respect of such funding). Payments to the Lender referred to in this sub-Clause 13.2
       shall be made by Sberbank at least one Business Day before the relevant payment is to be made
       or commission or cost incurred; provided that before such payment is made by Sberbank, the
       Lender shall submit an invoice substantially in the form provided in Schedule B providing, in
       reasonable detail, the nature and calculation of the relevant payment or cost. Subsequently,
       Sberbank and the Lender shall enter and sign a delivery and acceptance act (‘‘Act of Acceptance’’)
       as provided in sub-Clause 13.3.

13.3   Acts of Acceptance
       In connection with all payments to be made under Clause 12 and Clause 13 and sub-Clause 14.2,
       Sberbank and the Lender shall within 60 days of such payment becoming due or such indemnity
       claim being made, enter into and sign an Act of Acceptance (which Sberbank shall prepare) with
       respect to the amounts to be paid by Sberbank. Invoices and Acts of Acceptance shall separately
       specify: (i) the net amount due, (ii) any applicable Russian taxes and (iii) the resulting total
       tax-inclusive amount.

14     General
14.1   Evidence of Debt
       The entries made in the relevant Account shall, in the absence of manifest error, constitute prima
       facie evidence of the existence and amounts of Sberbank’s obligations recorded therein.

14.2   Stamp Duties
       14.2.1    Sberbank shall pay all stamp, registration and documentary taxes, duties or similar
                 charges (if any) imposed on Sberbank by any person in the Russian Federation or
                 Luxembourg which may be payable or determined to be payable in connection with the
                 execution, delivery, performance, enforcement, or admissibility into evidence of any Loan
                 Agreement and shall indemnify the Lender against any and all costs properly documented
                 which may be incurred or suffered by the Lender with respect to, or resulting from, delay
                 or failure by Sberbank to pay such taxes or similar charges.




                                                    117
       14.2.2    Sberbank agrees that if the Lender incurs a liability to pay any stamp, registration and
                 documentary taxes, duties or similar charges (if any) imposed by any person in the
                 Russian Federation or Luxembourg which may be payable or determined to be payable
                 in connection with the execution, delivery, performance, enforcement, or admissibility
                 into evidence of any Loan Agreement and any documents related thereto as well as the
                 documents related to the Lender’s funding of any Loan, Sberbank shall reimburse the
                 Lender on demand an amount equal to such stamp or other documentary taxes, charges
                 or duties and shall indemnify the Lender against any and all costs properly documented
                 and connected with the payment of such amounts.

       Provided, however, that before any such payment is made by Sberbank under either sub-Clause
       14.2.1 or sub-Clause 14.2.2, the Lender shall submit an invoice, substantially in the form set out
       in Schedule B, providing, in reasonable detail, the nature and calculation of the relevant
       payment. Subsequently, Sberbank and the Lender shall enter and sign an Act of Acceptance as
       provided in sub-Clause 13.3.

14.3   Waivers
       No failure to exercise and no delay in exercising, on the part of the Lender or Sberbank, any right,
       power to privilege under any Loan Agreement and no course of dealing between Sberbank and the
       Lender shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power
       or privilege preclude any other or further exercise thereof, or the exercise of any other right, power
       or privilege. The rights and remedies provided in each Loan Agreement are cumulative and not
       exclusive of any rights, or remedies provided by applicable law.

14.4   Notices
       All notices, requests, demands or other communications to or upon the respective parties to each
       Loan Agreement shall be given or made in the English language by telex, SWIFT or courier, or fax
       (in the case of the Lender only) to the party to which such notice, request, demand or other
       communication is required or permitted to be given or made under such Loan Agreement
       addressed as follows:
       14.4.1    if to Sberbank:
                 Sberbank
                 19 Vavilova Street
                 Moscow 117997
                 Russian Federation
                 Fax:              +7 495-747-3758
                 Telex:            414733 SBRF RU
                 SWIFT:            SABR RU MM
                 Attention:     Alexander V. Tataourov/Andrey V. Trusov
       14.4.2    if to the Lender:
                 SB Capital S.A.
                 2, Boulevard Konrad Adenauer
                 L-1115
                 Luxembourg
                 Fax:          +352 421 22 718
                 Attention:    The Directors
       or to such other address, telex, SWIFT or fax number as any party may hereafter specify in writing
       to the other.
       Any notice, request, demand or other communication given by courier shall be conclusively
       deemed to have been given on the day of actual delivery thereof and, if given by telex, fax or
       SWIFT, on the day of transmission thereof, in each case if given during the normal business hours
       of the recipient, and on the business day during which such normal business hours next occur if not
       given during such hours on any day.


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14.5   Assignment
       14.5.1   Each Loan Agreement shall inure to the benefit of and be binding upon the parties, their
                respective successors and any permitted assignee or transferee of some or all of a party’s
                rights or obligations under such Loan Agreement. Any reference in a Loan Agreement
                to any party shall be construed accordingly and, in particular, references to the exercise
                of rights and discretions by the Lender, following the enforcement of the security and/or
                assignment referred to in sub-Clause 14.5.3 below, shall be references to the exercise of
                such rights or discretions by the Trustee (as Trustee). Notwithstanding the foregoing, the
                Trustee shall not be entitled to participate in any discussions between the Lender and
                Sberbank or any agreements of the Lender or Sberbank pursuant to sub-Clauses 6.4 or
                6.7 or Clause 8.
       14.5.2   Sberbank shall not assign or transfer all or any part of its rights or obligations hereunder
                to any other party.
       14.5.3   The Lender may assign or transfer, in whole or in part, on or at any time after the date
                of this Agreement, any of its rights and benefits or obligations under this Agreement (i),
                with the prior written consent of Sberbank, to a company located in a Qualifying
                Jurisdiction and/or (ii), in connection with the funding of each Loan, by way of the charge
                by way of first fixed charge granted by the Lender and the absolute assignment by the
                Lender in favour of the Trustee (as Trustee) of the Lender’s rights and benefits under
                each Loan Agreement and, in each case under (ii) hereof, Sberbank agrees that it will, on
                or prior to the relevant Closing Date, acknowledge in writing any such charge and
                assignment.
       14.5.4   Any references in this Agreement to any such assignee or transferee pursuant to Clause
                14.5.3 shall be construed accordingly and, in particular, references to the rights, benefits
                and obligations hereunder of the Lender, following such assignment or transfer, shall be
                references to such rights, benefits or obligations by the assignee or transferee.

14.6   Currency Indemnity
       To the fullest extent permitted by law, the obligation of Sberbank in respect of any amount due in
       the Specified Currency (or such other currency as contemplated by such obligation) under a Loan
       Agreement shall, notwithstanding any payment in any other currency (whether pursuant to a
       judgment or otherwise), be discharged only to the extent of the amount in the Specified Currency
       (or such other currency as contemplated by such obligation) that the Lender may, in accordance
       with normal banking procedures, purchase with the sum paid in such other currency (after any
       premium and costs of exchange) on the Business Day immediately following the day on which the
       Lender receives such payment. If the amount in the Specified Currency (or such other currency as
       contemplated by such obligation) that may be so purchased for any reason falls short of the amount
       originally due (the ‘‘Due Amount’’), Sberbank hereby agrees to indemnify and hold harmless the
       Lender against any deficiency in the Specified Currency. Any obligation of Sberbank not
       discharged by payment in the Specified Currency (or such other currency as contemplated by such
       obligation) shall, to the fullest extent permitted by applicable law, be due as a separate and
       independent obligation and, until discharged as provided the relevant Loan Agreement, shall
       continue in full force and effect. If the amount in the Specified Currency (or such other currency
       as contemplated by such obligation) that may be purchased exceeds that Due Amount the Lender
       shall promptly pay the amount of the excess to Sberbank.

14.7   Contracts (Rights of Third Parties) Act 1999
       A person who is not a party to a Loan Agreement has no right under the Contracts (Rights of
       Third Parties) Act 1999 to enforce any term of such Loan Agreement.

14.8   Choice of Law
       Each Loan Agreement shall be governed by, and construed in accordance with, the laws of
       England.




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14.9   Jurisdiction
       14.9.1   For the exclusive benefit of the other party, each of Sberbank and the Lender hereby
                irrevocably agrees that the courts of England shall have jurisdiction to settle any disputes
                which may arise out of or in connection with any Loan Agreement and that accordingly
                any suit, action or proceeding (collectively, ‘‘Proceedings’’) arising out of or in connection
                with such Loan Agreement may be brought in such courts.
       14.9.2   Each of the parties irrevocably waives any objection which it may now or hereafter have
                to the laying of the venue of any Proceedings in any such court referred to in this Clause
                14 and any claim that any such Proceedings have been brought in an inconvenient forum
                and further irrevocably agrees that a final and conclusive judgment in any Proceedings
                brought in the English courts with competent jurisdiction shall be conclusive and binding
                and may be enforced in the courts of any other jurisdiction.
       14.9.3   Nothing contained in any Loan Agreement shall limit the right of any party to take
                Proceedings against another party in any other court of competent jurisdiction to the
                extent permitted by any applicable law, nor shall the taking of Proceedings in connection
                with such Loan Agreement in one or more jurisdictions preclude the taking of
                Proceedings in any other jurisdiction or in any other court of competent jurisdiction in
                connection with such Loan Agreement to the extent permitted by any applicable law.
       14.9.4   Each of the parties hereby agrees that, at the option of the other party, any dispute,
                controversy, claim or cause of action brought by any party against another party or arising
                out of or relating to any Loan Agreement may be settled by arbitration in accordance
                with the Rules of the London Court of International Arbitration (the ‘‘LCIA’’), which
                rules are deemed to be incorporated by reference into this Clause. The place of
                arbitration shall be London, England and the language of the arbitration shall be English.
                The number of arbitrators shall be three, each of whom shall be disinterested in the
                dispute or controversy, shall have no connection with any party thereto and shall be an
                attorney experienced in international securities transactions. Each party shall nominate
                an arbitrator, who, in turn, shall nominate an additional arbitrator who shall be the
                Chairman of the Tribunal. If a dispute, claim controversy or cause of action shall involve
                more than two parties, the parties thereto shall attempt to align themselves in two sides
                (i.e., claimant and respondent) each of which shall appoint an arbitrator as if there were
                only two sides to such dispute, claim controversy or cause of action. If such alignment and
                appointment shall not have occurred within twenty (20) calendar days after the initiating
                party serves the arbitration demand or if a Chairman has not been selected within thirty
                (30) calendar days of the selection of the second arbitrator, the LCIA Arbitration Court
                shall appoint the three arbitrators or the Chairman, as the case may be. The parties and
                the LCIA Arbitration Court may appoint arbitrators from among the nationals of any
                country, whether or not a party is a national of that country. The arbitrators shall have no
                authority to award punitive or other punitive type damages and may not, in any event,
                make any ruling, finding or award that does not conform to the terms and conditions of
                this Agreement.
       14.9.5   The fact that an arbitration award has been made, the content of that award and the
                arbitration proceedings contemplated by this Clause 14 shall be kept confidential by the
                parties (other than for purposes of enforcement of the award). Costs of the arbitration
                (excluding each party’s preparation, travel, attorneys’ fees and similar costs) shall be
                borne in accordance with the decision of the arbitrators. The decision of the arbitrators
                shall be final, binding and enforceable upon the parties and judgment upon any award
                rendered by the arbitrators may be entered in any court having jurisdiction thereof. In the
                event that the failure of a party to comply with the decision of the arbitrators requires any
                other party to apply to any court for enforcement of such award, the non-complying party
                shall be liable to the other for all costs of such litigation, including reasonable attorneys’
                fees.
       14.9.6   Lender’s Process Agent: The Lender agrees that the process by which any Proceedings in
                England are begun may be served on it by being delivered to Law Debenture Corporate
                Services Limited, 5th Floor, 100 Wood Street, London EC2V 7EX or at any other address
                for the time being at which process may be served on such person in accordance with Part

                                                    120
                XXIII of the Companies Act 1985 (as modified or re-enacted from time to time). If such
                person is not or ceases to be effectively appointed to accept service of process on the
                Lender’s behalf, the Lender shall, on the written demand of Sberbank, appoint a further
                person in England to accept service of process on its behalf and, failing such appointment
                within 15 days, Sberbank shall be entitled to appoint such a person by written notice to
                the Lender. Nothing in this Clause shall affect the right of Sberbank to serve process in
                any other manner permitted by law.
      14.9.7    Sberbank’s Process Agent: Sberbank agrees that the process by which any Proceedings in
                England are begun may be served on it by being delivered to Law Debenture Corporate
                Services Limited, 5th Floor, 100 Wood Street, London EC2V 7EX or its other principal
                place of business in England for the time being or at any other address for the time being
                at which process may be served on such person in accordance with Part XXIII of the
                Companies Act 1985 (as modified or re-enacted from time to time). If such person is not
                or ceases to be effectively appointed to accept service of process on Sberbank’s behalf,
                Sberbank shall, on the written demand of the Lender, appoint a further person in England
                to accept service of process on its behalf and, failing such appointment within 15 days, the
                Lender shall be entitled to appoint such a person by written notice to Sberbank. Nothing
                in this Clause shall affect the right of the Lender to serve process in any other manner
                permitted by law.

14.10 Waiver of Immunity
      To the extent that Sberbank may in any jurisdiction claim for itself or its assets or revenues
      immunity from suit, execution, attachment (whether in aid of execution, before making of a
      judgment or award or otherwise) or other legal process including in relation to the enforcement of
      an arbitration award and to the extent that such immunity (whether or not claimed) may be
      attributed in any such jurisdiction to Sberbank or its assets or revenues, Sberbank agrees not to
      claim and irrevocably waives such immunity to the full extent permitted by the laws of such
      jurisdiction.

14.11 Counterparts
      Each Loan Agreement may be executed in any number of counterparts and all of such
      counterparts taken together shall be deemed to constitute one and the same agreement.

14.12 Language
      The language which governs the interpretation of each Loan Agreement is the English language.

14.13 Amendments
      Except as otherwise provided by its terms, each Loan Agreement may not be varied except by an
      agreement in writing signed by the parties.

14.14 Partial Invalidity
      The illegality, invalidity or unenforceability to any extent of any provision of any Loan Agreement
      under the law of any jurisdiction shall affect its legality, validity or enforceability in such
      jurisdiction to such extent only and shall not affect its legality, validity or enforceability under the
      law of any other jurisdiction, nor the legality, validity or enforceability of any other provision.




                                                    121
                                           SCHEDULE A
                                       Form of Loan Supplement
This Loan Supplement is made on [SIGNING DATE] between:
(1) SB CAPITAL S.A., a société anonyme, incorporated in Luxembourg with limited liability, whose
    registered office is at 2, Boulevard Konrad Adenauer, L-1115 Luxembourg, registered with the
    Luxembourg Register of Commerce and Companies under number B-115914 (the ‘‘Lender’’); and
(2) SBERBANK, a company established under the laws of the Russian Federation whose registered
    office is at 19 Vavilova Street, Moscow 117997, Russian Federation (‘‘Sberbank’’).
Whereas:
(A) Sberbank has entered into facility agreement dated 12 May 2006 (such facility agreement, as may be
    amended or supplemented from time to time, the ‘‘Facility Agreement’’) with the Lender in respect
    of the U.S.$10,000,000,000 Programme for the issuance of loan participation notes by the Lender (the
    ‘‘Programme’’).
(B) Sberbank proposes to borrow ● (the ‘‘Loan’’) and the Lender wishes to make such Loan on the terms
    set out in the Facility Agreement and this Loan Supplement.
It is agreed as follows:
1   Definitions
    Capitalised terms used but not defined in this Loan Supplement shall have the meaning given to them
    in the Facility Agreement save to the extent supplemented or modified herein.
2   Additional Definitions
    For the purpose of this Loan Supplement, the following expressions used in the Facility Agreement
    shall have the following meanings:
    ‘‘Account’’ means the account in the name of the Lender (account number ●, ●);
    [‘‘Calculation Agent’’ means ●];
    ‘‘Closing Date’’ means ●;
    ‘‘Loan Agreement’’ means the Facility Agreement as amended and supplemented by this Loan
    Supplement;
    ‘‘Notes’’ means ● [● per cent.] [Floating Rate] Loan Participation Notes due ● issued by the Lender
    as Series ● under the Programme;
    ‘‘Repayment Date’’ means ● [amend as required for Floating Rate Notes];
    ‘‘Sberbank Account’’ means the account in the name of Sberbank (account number ●);
    ‘‘Specified Currency’’ means ●;
    ‘‘Subscription Agreement’’ means an agreement between the Lender, Sberbank and [MANAGERS]
    dated ● relating to the Notes;
    ‘‘Trust Deed’’ means the Principal Trust Deed between the Lender and the Trustee dated
    12 May 2006 (as may be amended or supplemented from time to time) as amended and supplemented
    by a Supplemental Trust Deed dated ● constituting and securing the Notes.
3   Incorporation by Reference
    Except as otherwise provided, the terms of the Facility Agreement shall apply to this Loan
    Supplement as if they were set out herein and the Facility Agreement shall be read and construed,
    only in relation to the Loan constituted hereby, as one document with this Loan Supplement.
4   The Loan
4.1 Drawdown
    Subject to the terms and conditions of the Loan Agreement, the Lender agrees to make the Loan on
    the Closing Date to Sberbank and Sberbank shall make a single drawing in the full amount of the
    Loan.

                                                  122
4.2 Interest
       The Loan is a [Fixed Rate][Floating Rate] Loan. Interest shall be calculated, and the following terms
       used in the Facility Agreement shall have the meanings, as set out below:

      4.2.1   Fixed Rate Loan Provisions                          [Applicable/Not Applicable]
              (If not applicable, delete the remaining sub-paragraphs of this paragraph)
              (i)     Interest Commencement Date:                 ●
              (ii)    Rate[(s)] of Interest:                      ● per cent. per annum payable
                                                                  [annually/semi-annually] in arrear
              (iii)   Interest Payment Date(s):                   ● in each year [adjusted in accordance
                                                                  with [specify Business Day Convention and
                                                                  any applicable Business Centre(s) for the
                                                                  definition of ‘‘Business Day’’]/not adjusted]
              (iv)    Fixed Amount[(s)]:                          ● per ● in principal amount
              (v)     Broken Amount:                              [Insert particulars of any initial or final
                                                                  broken interest amounts which do not
                                                                  correspond with the Fixed Amount [(s)]
                                                                  and the Interest Payment Date(s) to which
                                                                  they relate]
              (vi)    Day Count Fraction (Clause 4.9):            ●
                                                        (Day Count Fraction should be
                                                        Actual/Actual-ICMA for all fixed rate loans
                                                        other than those denominated in U.S.
                                                        dollars, unless specified)
              (vii) Determination Date(s) (Clause 4.9): ● in each year. [Insert regular interest
                                                        payment dates, ignoring issue date or
                                                        maturity date in the case of a long or short
                                                        first or last interest period](1)
              (viii) Other terms relating to the method [Not Applicable/give details]
                     of calculating interest for Fixed
                     Rate Loans:

      4.2.2   Floating Rate Loan Provisions                       [Applicable/Not Applicable]
              (If not applicable, delete the remaining sub-paragraphs of this paragraph)
              (i)     Interest Commencement Date:               ●
              (ii)    Interest Period(s):                       ●
              (iii)   Specified Interest Payment Dates:          ●
              (iv)    Business Day Convention:                  [Floating Rate Business Day
                                                                Convention/Following Business Day
                                                                Convention/Modified Following Business
                                                                Day Convention/Preceding Business Day
                                                                Convention/other (give details)]
              (v)    Business Centre(s) (Clause 4.9):           ●
              (vi)   Manner in which the Rate(s) of             [Screen Rate Determination/ISDA
                     Interest is/are to be determined:          Determination/other (give details)]
              (vii) Interest Period Date(s):                    [Not Applicable/specify dates]
              (viii) Party responsible for calculating      the ●
                     Rate(s) of Interest and Interest
                     Amount(s) (if not the Calculation
                     Agent):




(1)
       Only to be completed for a Loan where Day Count Fraction is Actual/Actual-ICMA.


                                                           123
          (ix)   Screen Rate Determination (Clause
                 4.3.3):
                 –       Relevant Time:               ●
                 –       Interest Determination Date: ● [TARGET] Business Days in [specify
                                                      city] for [specify currency] prior to [the
                                                      first day in each Interest Accrual
                                                      Period/each Interest Payment Date]]
                 –       Relevant Screen              [Specify relevant screen page or ‘‘Reference
                         Page/Primary Source for      Banks’’]
                         Floating Rate:
                 –       Reference Banks (if Primary [Specify four]
                         Source is ‘‘Reference
                         Banks’’):
                 –       Relevant Financial Centre:   [The financial centre most closely connected
                                                      to the Reference rate- specify if not
                                                      London]
                 –       Reference Rate:              [LIBOR, EURIBOR or other reference
                                                      rate]
                 –       Representative Amount:       [Specify if screen or Reference Bank
                                                      quotations are to be given in respect of a
                                                      transaction of a specified notional amount]
                 –       Effective Date:              [Specify if quotations are not to be obtained
                                                      with effect from commencement of Interest
                                                      Accrual Period]
                 –       Specified Duration:           [Specify period for quotation if not
                                                      duration of Interest Accrual Period]
          (x)    ISDA Determination (Clause 4.3):
                 –       Floating Rate Option:        ●
                 –       Designated Maturity:         ●
                 –       Reset Date:                  ●
                 –       ISDA Definitions: (if         ●
                         different from those set out
                         in the Conditions)
          (xi) Margin(s):                             [+/−]● per cent. per annum
          (xii) Minimum Rate of Interest:             ● per cent. per annum
          (xiii) Maximum Rate of Interest:            ● per cent. per annum
          (xiv) Day Count Fraction (Clause 4.9):      ●
          (xv) Rate Multiplier:                       ●
          (xvi) Fall back provisions, rounding        ●
                 provisions, denominator and any
                 other terms relating to the method
                 of calculating interest on Floating
                 Rate Loans, if different from those
                 set out in the Facility Agreement:

5   One-Time Commission

    In consideration of the Lender making the Loan to Sberbank, Sberbank hereby agrees that it shall,
    two Business Days before the Closing Date, pay to the Lender, in Same-Day Funds, the amount of
    ● in respect of a one-time commission in respect of the Loan pursuant to sub-Clause 3.2 of the
    Facility Agreement and supported by an invoice in the form provided in Schedule B of the Facility
    Agreement.

6   Governing Law

    This Loan Supplement shall be governed by and construed in accordance with English law.



                                                124
                                            SCHEDULE B

                                            Form of Invoice
Sberbank
19 Vavilova Street
117997 Moscow
Russian Federation
1     This is an invoice submitted pursuant to Clause ● of the Facility Agreement (the ‘‘Facility
      Agreement’’) entered into between Sberbank as Borrower and SB Capital S.A. as the Lender (the
      ‘‘Lender’’) on 12 May 2006 in respect of a Loan Agreement (as defined in the Facility Agreement)
      with a corresponding Loan Supplement dated ● between Sberbank and the Lender. Terms not
      otherwise defined herein have the meanings ascribed to them in the Facility Agreement.
2     Sberbank shall pay to the Lender an amount in the total sum of ● (the ‘‘Sum’’) in connection with
      ● on ●.
3     The Sum shall be paid in ● to the following account of the Lender:
      Beneficiary: SB Capital S.A.
      Beneficiary’s account: ●
      Beneficiary’s bank: ●
      Ref: Sberbank
Please indicate your acceptance of this invoice delivered under Clause ● of the Facility Agreement by
signing in the appropriate space below and returning to the Lender a copy hereof, whereupon this shall
be deemed accepted by Sberbank.
Yours faithfully
SB Capital S.A.
By:
Title:




                                                  125
                         FORM OF SUBORDINATED LOAN AGREEMENT
In the event that a Subordinated Series of Notes is to be issued under the Programme, it is anticipated that
Sberbank and the Issuer will enter into a Subordinated Loan Agreement substantially in the form set out
below, subject to such modifications and amendments as may be agreed at such time.
SUBORDINATED LOAN AGREEMENT, dated the Signing Date between:
(1)    SBERBANK, a company established under the laws of the Russian Federation whose registered
       office is at 19 Vavilova Street, 117997 Moscow, Russia (‘‘Sberbank’’); and
(2)                              ´´
       SB CAPITAL S.A., a societe anonyme established under the laws of Luxembourg whose registered
       office is at 2, Boulevard Konrad Adenauer, L-1115 Luxembourg, registered with the Luxembourg
       Register of Commerce and Companies under number B-115914 (the ‘‘Lender’’).
Whereas, the Lender has at the request of Sberbank agreed to make available to Sberbank a subordinated
loan facility on the terms and subject to the conditions of this Agreement as amended and supplemented
by the subordinated loan supplement (the ‘‘Subordinated Loan Supplement’’), dated the Signing Date (as
defined below) substantially in the form set out in the Schedule A hereto; and
Whereas, it is intended that the Lender will issue certain loan participation notes the payment obligations
under which will be based on amounts payable by Sberbank under the Facility (as defined below).
Now it is hereby agreed as follows:
1      Definitions and Interpretation
1.1    Definitions
       In this Agreement (including the recitals), the following terms shall have the meanings indicated:
       ‘‘Additional Capital’’ means additional capital as determined under the Additional Capital
       Regulation.
       ‘‘Additional Capital Regulation’’ means Regulation No. 215-P ‘‘On the Methodology of Calcula-
       tion of Net Worth (Capital) of Credit Organisations’’ dated 10 February 2003 issued by the CBR,
       as the same may be amended or replaced from time to time.
       ‘‘Advance’’ means the advance to be made under Clause 3.1 of the sum equal to the amount of the
       Facility.
       ‘‘Agency Agreement’’ means the paying agency agreement dated 12 May 2006, relating to the
       Programme between the Lender, the Trustee and the agents named therein, as may be amended
       or supplemented from time to time.
       ‘‘Affiliates’’ of any specified Person means any other Person, directly or indirectly, controlling or
       controlled by or under direct or indirect control with such specified Person. For the purposes of this
       definition, ‘‘control’’ when used with respect to any Person means the power to direct the
       management and policies of such Person, directly or indirectly, whether through the ownership of
       voting securities, by contract or otherwise; and the terms ‘‘controlling’’ and ‘‘controlled’’ have
       meanings correlative to the foregoing.
       ‘‘Agreement’’ means this Agreement as originally executed or as it may be amended from time to
       time.
       ‘‘Bankruptcy Proceedings’’ means any proceeding in a competent Russian court relating to
       bankruptcy or any other proceedings including, but not limited to, the revocation of a banking
       license or appointment of temporary administration, which could reasonably lead to an occurrence
       of the Event of Default.
       ‘‘Business Day’’ means (save in the case of Clause 4) a day (other than a Saturday or a Sunday)
       on which (a) banks and foreign exchange markets are open for business generally in the relevant
       place of payment, and ([b]) [foreign exchange transactions may be carried on in [insert currency]
       in [insert the principal financial centre of the country of that currency] (if the currency specified is not
       euro and where payments are made to an account in such currency)] [and ([c]) [a day on which the
       TARGET System is operating (where the payments are to be made in euro)] [and ([d]) [banks and
       foreign exchange markets are open for business generally in New York City (in the case of a Loan
       corresponding to a Rule 144A Series (as defined in the Dealer Agreement))].

                                                      126
‘‘Calculation Agent’’ means JPMorgan Chase Bank, N.A., London Branch or such other entity as
may be appointed by the Lender.
‘‘Capital Stock’’ means, with respect to any Person, any and all shares, equity interests, equity
participations, rights to purchase, warrants, options, or other equivalents (however designated) of
capital stock of a corporation and any and all equivalent ownership interests in a Person other than
a corporation, in each case whether now outstanding or hereafter issued.
‘‘CBR’’ means the Central Bank of the Russian Federation.
‘‘Change of Law’’ means any of the enactment or introduction of any new law, the variation,
amendment or repeal of an existing or new law, and any ruling on or interpretation or application
by a competent authority of any existing or new law which, in each case, occurs after the date
hereof and for this purpose the word ‘‘law’’ means all or any of the following whether in existence
at the date hereof or introduced hereafter and with which it is obligatory or customary for banks
or other financial institutions or, as the case may be, companies in the relevant jurisdiction to
comply:
(i)    any statute, treaty, order, decree, instruction, letter, directive, instrument, regulation,
       ordinance, or similar legislative or executive action by any national or international or local
       government or authority or by any ministry or department thereof and other agencies of
       state power and administration (including, but not limited to, taxation departments and
       authorities); and/or
(ii)   any letter, regulation, decree, instruction, request, notice, guideline, directive, statement of
       policy or practice statement given by, or required of, any central bank or other monetary
       authority, or by or of any Taxing Authority or fiscal or other authority or agency (whether
       or not having the force of law); and
the decision or ruling on, the interpretation or application of, or a change in the interpretation or
application of, any of the foregoing by any court of law, tribunal, central bank, monetary authority
or agency or any Taxing Authority or fiscal or other competent authority or agency.
‘‘Closing Date’’ means the date specified as such in the Subordinated Loan Supplement.
‘‘Conditions’’ means the terms and conditions of the Notes as set out in Schedule 3 of the Principal
Trust Deed, as amended and/or supplemented by the relevant final terms dated the Signing Date
applicable to the Notes.
‘‘Dealer Agreement’’ means the dealer agreement relating to the Programme dated 12 May 2006
between the Lender, Sberbank, Barclays Bank PLC, J.P. Morgan Securities Ltd. and the other
dealers named therein or appointed pursuant thereto, as may be further amended or supplemented
from time to time.
‘‘Encumbrance’’ means any mortgage, charge, pledge, lien (other than a lien arising solely by
operation of law which is discharged within 90 days of arising) or other security interest securing
any obligation of any Person or any other type of preferential arrangement (including any title
transfer and retention arrangement) having a similar effect.
‘‘Event of Default’’ means an entry into force of a final decision of a competent Russian court
finding Sberbank a bankrupt.
‘‘Facility’’ has the meaning specified in the Subordinated Loan Supplement.
‘‘Financial Indebtedness’’ means any obligation for the payment of money in any currency, whether
sole, joint or several, and whether actual or contingent, in respect of:
(a)    moneys borrowed or raised (including the capitalised value of obligations under financial
       leases and hire purchase agreements which would, in accordance with IFRS, be treated as
       finance or capital leases but excluding moneys raised by way of the issue of share capital
       (whether or not for a cash consideration) and any premium on such share capital) and
       interest and other charges thereon or in respect thereof;
(b)    any liability under any debenture, bond, note, loan stock or other security or under any
       acceptance or documentary credit, bill discounting or note purchase facility or any similar
       instrument;


                                             127
(c)    any liability in respect of the deferred acquisition cost of property, assets or services to the
       extent payable after the time of acquisition or possession thereof by the party liable, but not
       including any such liability in respect of normal trade credit for a period not exceeding six
       months for goods or services supplied;

(d)    any liability under any interest rate or currency hedging agreement (and the amount for
       such Financial Indebtedness in relation to any such transaction shall be calculated by
       reference to the mark-to-market valuation of such transaction (if it shows a sum owed to the
       counterparty of Sberbank or any Subsidiary), at the relevant time);

(e)    any liability under or in respect of any bonding facility, guarantee facility or similar facility;
       and

(f)    (without double counting) any guarantee or other assurance against financial loss in respect
       of such moneys borrowed or raised, interest, charges or other liability (whether the person
       liable in respect of such moneys borrowed or raised, interest, charges or other liability is or
       is not a member of the Group).

‘‘Group’’ means Sberbank and its Subsidiaries taken as a whole.

‘‘IFRS Financial Statements’’ means the audited financial statements of Sberbank for the financial
years ended 31 December ● and 31 December ● [and the reviewed financial statements of
Sberbank for the ● month periods ended ● and ●], in each case prepared in accordance with
International Financial Reporting Standards issued by the International Accounting Standards
Board (as amended, supplemented or re-issued from time to time) (‘‘IFRS’’).

‘‘Interest Rate Step-Up Date’’ means the date specified as such in the Subordinated Loan
Supplement.

‘‘Lender Account’’ means an account in the name of the Lender as defined in the Subordinated
Loan Supplement.

‘‘Lender Agreements’’ means the Dealer Agreement, the Subscription Agreement, this Agreement,
the Subordinated Loan Supplement, the Agency Agreement and the Trust Deed.

‘‘Loan’’, at any time, means an amount, as set out in the Subordinated Loan Supplement, equal to
the aggregate principal amount of the Facility granted by the Lender pursuant to the terms of this
Agreement and the Subordinated Loan Supplement.

‘‘Material Adverse Effect’’ means a material adverse effect on (a) the financial condition or
operations of Sberbank or of Sberbank and any of its Principal Subsidiaries taken as a whole or (b)
Sberbank’s ability to perform its obligations under this Agreement or (c) the validity, legality or
enforceability of this Agreement or the rights or remedies of the Lender under this Agreement.

‘‘Noteholder’’ means, in relation to a Note, the person in whose name such Note is registered in
the register of the noteholders (or in the case of joint holders, the first named holder thereof).

‘‘Notes’’ means the loan participation notes, as further defined in the Subordinated Loan
Supplement, proposed to be issued by the Lender pursuant to the Trust Deed for the purpose of
financing the Loan.

‘‘Officer’s Certificate’’ means a certificate signed by an officer of Sberbank who shall be the
principal executive officer, principal accounting officer or principal financial officer of Sberbank.

‘‘Opinion of Counsel’’ means a written opinion from international legal counsel as reasonably
selected by Sberbank or the Lender, as the case may be, with the written consent of the Lender or
Sberbank, as the case may be, such consent not to be unreasonably withheld or delayed.

‘‘Person’’ means any individual, corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organisation, government, or any agency or
political subdivision thereof or any other entity.

‘‘Potential Event of Default’’ means any event which, after notice or passage of time or both, would
be an Event of Default.


                                              128
‘‘Principal Subsidiary’’ means at any relevant time a Subsidiary of Sberbank:
(a)    whose total assets or gross revenues (or, where the Subsidiary in question prepares
       consolidated accounts, whose total consolidated assets or gross consolidated revenues, as
       the case may be) represent not less than 10 per cent. of the total consolidated assets or the
       gross consolidated revenues of Sberbank and its Subsidiaries, all as calculated by reference
       to the then latest audited accounts (or consolidated accounts as the case may be) (in each
       case, produced on the basis of IFRS, consistently applied) of such Subsidiary and the then
       latest audited consolidated accounts of Sberbank (produced on the basis of IFRS,
       consistently applied) and its consolidated Subsidiaries; or
(b)    to which is transferred all or substantially all the assets and undertaking of a Subsidiary
       which immediately prior to such transfer is a Principal Subsidiary.
‘‘Principal Trust Deed’’ means the principal trust deed dated 12 May 2006 between the Issuer and
the Trustee, as may be amended or supplemented from time to time.
‘‘Programme’’ means the programme for the issuance of loan participation notes by the Lender for
the purpose of financing loans.
‘‘Qualifying Jurisdiction’’ means any jurisdiction in which the Lender or any successor thereto is
entitled to receive payment of interest on the Loan under a double taxation agreement in force on
such date (subject to the completion of any necessary procedural formalities) providing for full
exemption from Russian withholding tax on interest derived from a source within the Russian
Federation to a resident of such jurisdiction.
‘‘Relevant Indebtedness’’ means any Financial Indebtedness which (a) is in the form of or
represented by any bond, note, debenture stock, loan stock, certificate or other debt instrument
which is listed or quoted on any stock exchange; (b) is denominated, payable or optionally payable
in a currency other than roubles; and (c) was initially offered and distributed (as to more than
50 per cent. of the original principal amount of such debt) outside the Russian Federation.
‘‘Repayment Date’’ means the date specified as such in the Subordinated Loan Supplement.
‘‘Reserved Rights’’ has the meaning assigned to such term in the Conditions.
‘‘Roubles’’ means the lawful currency of the Russian Federation.
‘‘Russia’’ shall mean the Russian Federation and any political subdivision or agency thereof or
therein and ‘‘Russian’’ shall be construed accordingly.
‘‘Same-Day Funds’’ means [Dollar funds settled through the New York Clearing House Interbank
Payments System (where the Loan is U.S. dollar denominated)] [euro funds settled through the
TARGET System (where the Loan is euro-denominated)] [such funds for payment in [insert
relevant currency] as the Lender may at any time determine to be customary for the settlement of
international transactions in [insert principal financial centre of the country of the relevant currency]
of the type contemplated hereby].
‘‘Series’’ means a series of Notes which (except in respect of the first payment of interest and their
issue price) have identical terms on issue and are expressed to have the same series number.
‘‘Signing Date’’ means the date specified as such in the Subordinated Loan Supplement.
‘‘Subscription Agreement’’ means the agreement specified as such in the Subordinated Loan
Supplement.
‘‘Subsidiary’’ means, with respect to any Person, (i) any corporation, association or other business
entity of which at least 50 per cent. of the total voting power entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is
at the time owned or controlled, directly or indirectly, by such Person or one or more of the other
Subsidiaries of such Person (or any combination thereof) and (ii) any partnership (a) the sole
general partner or the managing general partner of which is such Person or a Subsidiary of such
person or (b) the only general partners of which are such Person or one or more Subsidiaries of
such Person (or any combination thereof).
‘‘Supplemental Trust Deed’’ means the supplemental trust deed substantially in the form set out in
Schedule 9 to the Principal Trust Deed (or such other form as may be approved by the Trustee)

                                              129
      which shall be supplemental to the Principal Trust Deed and dated the Closing Date between the
      Lender and the Trustee, and which shall constitute and secure the Notes, the proceeds of which
      shall be used to make the Loan.
      ‘‘TARGET System’’ means the Trans-European Real-Time Gross Settlement Express Transfer
      (TARGET) System or any successor thereof.
      ‘‘Taxes’’ means any taxes (including interest or penalties thereon arising from the non-payment
      thereof) which are now or at any time hereafter imposed, assessed, charged, levied, collected,
      demanded, withheld or claimed by the Russian Federation, Luxembourg (or any Qualifying
      Jurisdiction in which the Lender or any successor thereto is resident for tax purposes) or any
      Taxing Authority relating thereto, provided, however, that for the purposes of this definition the
      references to Luxembourg shall, upon the occurrence of a Relevant Event (as this term is defined
      in the Trust Deed), be deemed to be references to the jurisdiction in which the Trustee is domiciled
      for tax purposes; and the term ‘‘Taxation’’ shall be construed accordingly.
      ‘‘Taxing Authority’’ means any government or political subdivision or territory or provision of any
      government or authority or agency therein or thereof having the power to tax within Russia or
      Luxembourg (or any Qualifying Jurisdiction in which the Lender or any successor is resident for
      tax purposes).
      ‘‘Trust Deed’’ means the Principal Trust Deed as supplemented by the Supplemental Trust Deed.
      ‘‘Trustee’’ means J.P. Morgan Corporate Trustee Services Limited, as trustee under the Trust Deed
      and any other trustee or Trustees for the time being of such trust deed as provided thereunder.
      ‘‘Wholly Owned Subsidiary’’ means a Person whose total Capital Stock is owned, directly or
      indirectly, by Sberbank.
1.2   Other Definitions
      Unless the context otherwise requires, terms used in this Agreement which are not defined in this
      Agreement but which are defined in the Trust Deed, the Notes, the Paying Agency Agreement, the
      Dealer Agreement, the Subscription Agreement or the Subordinated Loan Supplement shall have
      the meanings assigned to such terms therein.
1.3   Interpretation
      Unless the context or the express provisions of this Agreement otherwise require, the following
      shall govern the interpretation of this Agreement:
      1.3.1      All references to ‘‘Clause’’ or ‘‘sub-Clause’’ are references to a Clause or a sub-Clause of
                 this Agreement.
      1.3.2      The terms ‘‘hereof’’, ‘‘herein’’ and ‘‘hereunder’’ and other words of similar import shall
                 mean this Agreement as a whole and not any particular part hereof.
      1.3.3      Words importing the singular number include the plural and vice versa.
      1.3.4      All references to ‘‘taxes’’ include all present or future taxes, levies, imposts and duties of
                 any nature and the terms ‘‘tax’’ and ‘‘taxation’’ shall be construed accordingly.
      1.3.5      The table of contents and the headings are for convenience only and shall not affect the
                 construction hereof.
      1.3.6      All references to ‘‘this Agreement’’ are references to this Subordinated Loan Agreement
                 dated ● 2006.

2     Facility, Purpose, Subordination
2.1   Facility
      On the terms and subject to the conditions set forth herein, the Lender hereby agrees to lend
      Sberbank, and Sberbank hereby agrees to borrow from the Lender, an amount equal to the Facility.
2.2   Purpose
      The proceeds of the Advance will be used for [general corporate purposes], but the Lender shall
      not be concerned with the application thereof.

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2.3   Subordination
      2.3.1      The claims of the Lender under this Agreement, excluding the Reserved Rights,
                 constitute the direct, unconditional and unsecured subordinated obligations of Sberbank
                 and will rank at least equally with all other unsecured and subordinated obligations of
                 Sberbank (whether actual or contingent) having a fixed maturity from time to time
                 outstanding save only for such obligations as may be preferred by mandatory provisions
                 of applicable law. The Reserved Rights constitute the direct, unconditional, unsecured
                 and unsubordinated obligations of Sberbank and will rank at least equally with other
                 unsecured and unsubordinated obligations of Sberbank save only for such obligations as
                 may be preferred by mandatory provisions of applicable law.
      2.3.2      Upon the occurrence of an Event of Default and so long as such Event of Default is
                 continuing, the claims of the Lender under this Agreement, excluding the Reserved
                 Rights, shall be subordinated in right of payment to the claims of all Senior Creditors (as
                 defined below).
                 As used in this Agreement, ‘‘Senior Creditors’’ means all creditors of Sberbank other
                 than creditors whose claims are in respect of (i) the share capital of Sberbank (including
                 preference shares) or (ii) other obligations ranking equally with or junior to the claims of
                 the Lender hereunder pursuant to Russian law or an agreement (excluding the Reserved
                 Rights).
                 The Lender agrees that so long as any Event of Default has occurred and is continuing,
                 any amounts that would otherwise be due to the Lender under this Agreement, other
                 than amounts in respect of the Reserved Rights, will only be paid after the payment in full
                 of all claims of the Senior Creditors (including interest and other amounts in respect of
                 such claims accruing after the date of commencement of such Event of Default).
                 Thereafter, such amounts that would otherwise be paid to the Lender under this
                 Agreement will be paid equally and rateably, together with all obligations of Sberbank
                 ranking equally in right of payment with the liabilities of Sberbank under this Agreement.
      2.3.3      The Lender shall not be entitled to offset any liabilities of Sberbank under this
                 Agreement, excluding the Reserved Rights, against any liabilities owing by the Lender to
                 Sberbank.
3     Drawdown
3.1   Drawdown
      On the terms and subject to the conditions set forth herein, on the Closing Date the Lender shall
      make the Advance to Sberbank and Sberbank shall make a single drawing in the full amount of
      the Facility.
3.2   One-Time Loan Commission
      In consideration of the Lender making the Loan available to Sberbank, Sberbank hereby agrees
      that it shall, two Business Days before the Closing Date, pay to the Lender, in Same-Day Funds,
      an amount equal to a one-time commission of the Lender in an amount to be specified in the
      relevant Loan Supplement, as supported by an invoice substantially in the form set out in
      Schedule B.
3.3   Disbursement
      Subject to the conditions set forth herein, on the Closing Date, the Lender shall transfer the
      amount of the Advance to Sberbank’s account number ● at ●, SWIFT Code: ●.
4     Interest
4.1   [Rate of Interest and Payment of Interest (in the case of a fixed rate loan)
      4.1.1      Rate of Interest: [The Loan bears interest on its outstanding principal amount from (and
                 including) the Interest Commencement Date at the rate(s) per annum (expressed as a
                 percentage) equal to the Initial Rate of Interest during the Initial Interest Term and at a
                 rate equal to the Yield Adjustment Rate plus ● per cent. per annum (the ‘‘Step-Up Rate
                 of Interest’’ and the Initial Rate of Interest or the Step-Up Rate of Interest, as applicable,
                 shall be the ‘‘Rate of Interest’’) during the Step-Up Interest Term.] (Include where interest
                 is to be calculated by reference to a percentage rate applied to the outstanding principal
                 amount of the Loan)

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         [The amount of interest payable on each Interest Payment Date shall be equal to the
         Initial Interest Amount during the Initial Interest Term, and shall be equal to the Step-Up
         Interest Amount during the Step-Up Interest Term.] (Include where interest is determined
         by specified Fixed or Broken Amounts)
4.1.2    Payment of Interest: [Interest at the relevant Rate of Interest shall accrue from day to
         day, starting from (and including) the Interest Commencement Date and] [Payments
         equal to the Interest Amount] shall be paid, in arrears not later than 10:00 a.m. ([specify
         principal financial centre of country of applicable currency]), one Business Day prior to
         each Interest Payment Date[, in an amount accrued with respect to the preceding Interest
         Period.]
4.1.3    Business Day Convention: Any date referred to herein that would otherwise fall on a day
         that is not a Business Day [(Following Business Day Convention) shall be postponed to
         the next day that is a Business Day] [(Modified Following Business Day Convention) shall
         be postponed to the next day that is a Business Day unless it would thereby fall into the
         next calendar month, in which event such date shall be brought forward to the
         immediately preceding Business Day] [(Preceding Business Day Convention), shall be
         brought forward to the immediately preceding Business Day] [Any other Day Count
         Fraction–please specify].]
[Interest (Alternative Clause 4.1 in the case of a floating rate loan)
4.1.1    Interest Payment Dates: The Loan will bear interest on its outstanding principal amount
         from (and including) the Interest Commencement Date and thereafter from (and
         including) each Interest Payment Date, in each case to (but excluding) the next Interest
         Payment Date at the rate per annum (expressed as a percentage) equal to the Rate of
         Interest. Such interest shall be paid by Sberbank to the Lender in arrear not later than
         10:00 a.m. one Business Day prior to each Interest Payment Date. Such Interest Payment
         Date(s) is/are either shown in the Subordinated Loan Supplement as Specified Interest
         Payment Date(s) or, if no Specified Interest Payment Date(s) is/are shown in the
         Subordinated Loan Supplement, Interest Payment Date shall mean each date which falls
         the number of months or other period shown in the Subordinated Loan Supplement as
         the Interest Period after the preceding Interest Payment Date or, in the case of the first
         Interest Payment Date, after the Interest Commencement Date.
4.1.2    Business Day Convention: Any date referred to herein that would otherwise fall on a day
         that is not a Business Day [(Floating Rate Business Day Convention) shall be postponed
         to the next day that is a Business Day unless it would thereby fall into the next calendar
         month, in which event (x) such date shall be brought forward to the immediately
         preceding Business Day and (y) each subsequent such date shall be the last Business Day
         of the month in which such date would have fallen had it not been subject to adjustment]
         [(Following Business Day Convention) such date shall be postponed to the next day that
         is a Business Day] [(Modified Following Business Day Convention) such date shall be
         postponed to the next day that is a Business Day unless it would thereby fall into the next
         calendar month, in which event such date shall be brought forward to the immediately
         preceding Business Day] [(Preceding Business Day Convention), such date shall be
         brought forward to the immediately preceding Business Day].
4.1.3    Rate of Interest: The Rate of Interest in respect of the Loan for each Interest Accrual
         Period shall be determined in accordance with the Subordinated Loan Supplement and
         the provisions relating to [ISDA Determination] [Screen Rate Determination] specified
         in sub-Clause 4.1.4 below.
4.1.4    [ISDA Determination: The Rate of Interest for each Interest Accrual Period shall be
         determined by the Calculation Agent as a rate equal to the relevant ISDA Rate. For the
         purposes of this sub-Clause 4.1.4, ‘‘ISDA Rate’’ for an Interest Accrual Period means a
         rate equal to the Floating Rate that would be determined by the Calculation Agent under
         a Swap Transaction under the terms of an agreement incorporating the ISDA Definitions
         and under which:
         (a)    the Floating Rate Option is as specified in the Subordinated Loan Supplement;
         (b)    the Designated Maturity is as specified in the Subordinated Loan Supplement; and


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(c)     the relevant Reset Date is [the first day of that Interest Accrual Period] [as
        specified in the Subordinated Loan Supplement].
For the purposes of this sub-Clause 4.1.4, ‘‘Floating Rate,’’ ‘‘Calculation Agent,’’
‘‘Floating Rate Option,’’ ‘‘Designated Maturity,’’, ‘‘Reset Date’’ and ‘‘Swap Transaction’’
have the meanings given to those terms in the ISDA Definitions.]
[Screen Rate Determination: (Alternative Clause 4.1.4)
(i)     [The Rate of Interest for each Interest Accrual Period will, subject as provided
        below, be either:
        (a)    the offered quotation; or
        (b)    the arithmetic mean of the offered quotations,
        (expressed as a percentage rate per annum) for the Reference Rate which appears
        or appear, as the case may be, on the [insert information source and screen page]
        (the ‘‘Relevant Screen Page’’) as at 11:00 a.m. [London time (in the case of
        LIBOR)] [Brussels time (in the case of EURIBOR)] on the Interest Determination
        Date in question as determined by the Calculation Agent. If five or more of such
        offered quotations are available on the Relevant Screen Page, the highest (or, if
        there is more than one such highest quotation, one only of such quotations) and
        the lowest (or, if there is more than one such lowest quotation, one only of such
        quotations) shall be disregarded by the Calculation Agent for the purpose of
        determining the arithmetic mean of such offered quotations.] (Use where the
        Reference Rate is LIBOR or EURIBOR)
        [Where the Reference Rate is specified below as being other than LIBOR or
        EURIBOR, please set out provisions for determining the Rate of Interest]
(ii)    If the Relevant Screen Page is not available or if sub-paragraph (i)(a) applies and
        no such offered quotation appears on the Relevant Screen Page or if sub-
        paragraph (i)(b) above applies and fewer than three such offered quotations
        appear on the Relevant Screen Page in each case as at the time specified above,
        subject as provided below, the Calculation Agent shall request (if the Reference
        Rate is LIBOR) [the principal London office of each of the Reference Banks] (if
        the Reference Rate is EURIBOR) [the principal Euro-zone office of each of the
        Reference Banks] to provide the Calculation Agent with its offered quotation
        (expressed as a percentage rate per annum) for the Rate of Interest (if the
        Reference Rate is LIBOR) [at approximately 11:00 a.m. (London time)] (if the
        Reference Rate is EURIBOR) [at approximately 11:00 a.m. (Brussels time)] on the
        Interest Determination Date in question. If two or more of the Reference Banks
        provide the Calculation Agent with such offered quotations, the Rate of Interest
        for such Interest Period shall be the arithmetic mean of such offered quotations as
        determined by the Calculation Agent; and
(iii)   if paragraph (ii) above applies and the Calculation Agent determines that fewer
        than two Reference Banks are providing offered quotations, subject as provided
        below, the Rate of Interest shall be either (i) the arithmetic mean of the rates per
        annum (expressed as a percentage) as communicated to (and at the request of) the
        Calculation Agent by the Reference Banks or any two or more of them, offered by
        such Banks, (if the Reference Rate is LIBOR)[at approximately 11:00 a.m. (London
        time)] (if the Reference Rate is EURIBOR) [at approximately 11:00 a.m. (Brussels
        time)] on the relevant Interest Determination Date, in respect of deposits in
        [specify currency] for a period equal to that which would have been used for the
        Reference Rate by leading banks in (if the Reference Rate is LIBOR) [the London
        inter-bank market] (if the Reference Rate is EURIBOR) [the Euro-zone inter-bank
        market], or (ii) if fewer than two of the Reference Banks so requested provide the
        Calculation Agent with such offered rates, the offered rate for deposits in [specify
        currency] for a period equal to that which would have been used for the Reference
        Rate, or the arithmetic mean of the offered rates for deposits in [specify currency]
        for a period equal to that which would have been used for the Reference Rate, at
        which, (if the Reference Rate is LIBOR) [at approximately 11:00 a.m. (London
        time) (if the Reference Rate is EURIBOR) [at approximately 11:00 a.m. (Brussels

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                      time)], on the relevant Interest Determination Date, any one or more banks
                      (which bank or banks is or are in the opinion of the Trustee and the Lender
                      suitable for such purpose) informs the Calculation Agent it is quoting to leading
                      banks in (if the Reference Rate is LIBOR) [the London inter-bank market] (if the
                      Reference Rate is EURIBOR) [the Euro-zone inter-bank market] provided that, if
                      the Rate of Interest cannot be determined in accordance with the foregoing
                      provisions of this paragraph, the Rate of Interest shall be determined as at the last
                      preceding Interest Determination Date (although substituting, where a different
                      Margin is to be applied to the relevant Interest Accrual Period from that which
                      applied to the last preceding Interest Accrual Period, the Margin relating to the
                      relevant Interest Accrual Period, in place of the Margin relating to that last
                      preceding Interest Accrual Period).]
               [Specify alternative fall-back provisions if required]
4.2   Accrual of Interest
      Interest shall cease to accrue on the Loan on the due date for repayment unless payment is
      improperly withheld or refused, in which event interest shall continue to [accrue (as well after as
      before judgment) at the applicable Rate of Interest] (in the case of interest determined by reference
      to a Rate of Interest) [be payable in an amount equal to ● per [day/[other period–please specify]]
      (in the case of a fixed rate loan where the interest is determined by reference to Interest Amounts)]
      to but excluding the date on which payment in full of the principal thereof is made.
4.3   Margin and Rounding
      4.3.1    [An adjustment shall be made to [the Rate of Interest] [the Rates of Interest for the
               specified Interest Accrual Periods] calculated in accordance with sub-Clause 4.1 above by
               adding (if a positive number) or subtracting (if a negative number) the absolute value of
               the [relevant] Margin.]
      4.3.2    For the purposes of any calculations required in respect of this Agreement (unless
               otherwise specified), (x) all percentages resulting from such calculations shall be rounded,
               if necessary, to the nearest one hundred-thousandth of a percentage point (with halves
               being rounded up), (y) all figures shall be rounded to seven significant figures (with halves
               being rounded up) and (z) all currency amounts that fall due and payable shall be
               rounded to the nearest unit of such currency (with halves being rounded up), save in the
               case of yen, which shall be rounded down to the nearest yen. For these purposes ‘‘unit’’
               means the lowest amount of such currency that is available as legal tender in the country
               or countries of such currency.
4.4   Calculations
      The amount of interest payable in respect of the Loan for any period shall be [(in the case of interest
      determined by reference to a Rate of Interest) calculated by multiplying the product of the Rate of
      Interest and the outstanding principal amount of such Loan by the Day Count Fraction] [(insert in
      the case of a fixed rate loan where an Interest Amount (or a formula for its calculation) is specified
      in the Subordinated Loan Supplement as the interest payment in respect of such period) equal to the
      Interest Amount/calculated in accordance with the formula specified in the Subordinated Loan
      Supplement in connection therewith]. Where any Interest Period comprises two or more Interest
      Accrual Periods, the amount of interest payable in respect of such Interest Period shall be the sum
      of the amounts of interest payable in respect of each of those Interest Accrual Periods.
4.5   [Determination and Notification of Rates of Interest and Interest Amounts
      The Calculation Agent shall, as soon as practicable on each Interest Determination Date or such
      other time on such date as the Calculation Agent may be required to calculate any rate or amount,
      [obtain any quotation] [make any determination] [or] [calculation] [determine such rate] and
      calculate the Interest Amounts in respect of the Loan for the relevant Interest Accrual Period,
      [obtain such quotation] [make such determination] [calculation] and cause the Rate of Interest and
      the Interest Amounts for each Interest Period and the relevant Interest Payment Date to be
      notified to Sberbank, the Lender, and any other Calculation Agent appointed in respect of the
      Loan that is to make a further calculation upon receipt of such information. [Where any Interest
      Payment Date or Interest Period Date is subject to adjustment pursuant to sub-Clause 4.1.2, the
      Interest Amounts and the Interest Payment Date so notified may subsequently be amended (or

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      appropriate alternative arrangements made with the consent of Sberbank and the Lender by way
      of adjustment) without notice in the event of an extension or shortening of the Interest Period.] [If
      the Loan becomes due and payable under Clause 11, the accrued interest and the Rate of Interest
      payable in respect of the Loan shall nevertheless continue to be calculated as previously in
      accordance with this Clause. The determination of any rate or amount, the obtaining of each
      quotation and the making of each determination or calculation by the Calculation Agent(s) shall
      (in the absence of manifest error) be final and binding upon all parties.] (in the case of a floating
      rate loan only)
4.6   Determination or Calculation by Trustee
      If the Calculation Agent does not at any time for any reason determine or calculate the Rate of
      Interest for an Interest Period or any Interest Amount in relation to the Loan, the Lender and
      Sberbank agree that such determination or calculation may be made by or at the direction of the
      Trustee. The Trustee shall incur no liability in respect of such determination or calculation.
4.7   Definitions
      In this Clause 4, unless the context otherwise requires, the following defined terms shall have the
      meanings set out below:
      [‘‘Broken Amount’’ means the amount(s) specified as such in the Subordinated Loan Supplement.
      (Include, if required, in the case of fixed rate loans only)]
      ‘‘Business Day’’ means:
      (i)     (in the case of a currency other than euro) [a day (other than a Saturday or Sunday) on which
              commercial banks and foreign exchange markets settle payments in the principal financial
              centre for such currency.]
      (ii)    (in the case of euro) [a day on which the TARGET system is operating (a ‘‘TARGET
              Business Day’’).]
      (iii)   (in the case of a currency and/or one or more [specify Business Centres]) [a day (other than
              a Saturday or a Sunday) on which commercial banks and foreign exchange markets settle
              payments [in such currency in the [specify Business Centres]] [generally in each of the
              [specify Business Centres]].]
      ‘‘Day Count Fraction’’ means, in respect of the calculation of an amount of interest on any Note
      for any period of time (from and including the first day of such period to but excluding the last)
      (whether or not constituting an Interest Period, the ‘‘Calculation Period’’):
      (Select one of the following; delete the remainder)
      (i)     [‘‘Actual/365’’ or ‘‘Actual/Actual-ISDA’’: the actual number of days in the Calculation
              Period divided by 365 (or, if any portion of that Calculation Period falls in a leap year, the
              sum of (A) the actual number of days in that portion of the Calculation Period falling in a
              leap year divided by 366 and (B) the actual number of days in that portion of the
              Calculation Period falling in a non-leap year divided by 365).]
      (ii)    [‘‘Actual/365 (Fixed)’’:   the actual number of days in the Calculation Period divided by
              365.]
      (iii)   [‘‘Actual/360’’:   the actual number of days in the Calculation Period divided by 360.]
      (iv)    [‘‘30/360’’, ‘‘360/360’’ or ‘‘Bond Basis’’: the number of days in the Calculation Period
              divided by 360 (the number of days to be calculated on the basis of a year of 360 days with
              12 30-day months (unless (a) the last day of the Calculation Period is the 31st day of a month
              but the first day of the Calculation Period is a day other than the 30th or 31st day of a month,
              in which case the month that includes that last day shall not be considered to be shortened
              to a 30-day month, or (b) the last day of the Calculation Period is the last day of the month
              of February, in which case the month of February shall not be considered to be lengthened
              to a 30-day month)).]
      (v)     [‘‘30E/360’’ or ‘‘Eurobond Basis’’: the number of days in the Calculation Period divided by
              360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day
              months, without regard to the date of the first day or last day of the Calculation Period
              unless, in the case of a Calculation Period ending on the Repayment Date, the Repayment
              Date is the last day of the month of February, in which case the month of February shall not
              be considered to be lengthened to a 30-day month).]

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(vi)   [‘‘Actual/Actual-ICMA’’:
       (a)      If the Calculation Period is equal to or shorter than the Determination Period during
                which it falls, the number of days in the Calculation Period divided by the product
                of (x) the number of days in such Determination Period and (y) the number of
                Determination Periods normally ending in any year; and
       (b)      if the Calculation Period is longer than one Determination Period, the sum of:
                (i)    the number of days in such Calculation Period falling in the Determination
                       Period in which it begins divided by the product of (1) the number of days in
                       such Determination Period and (2) the number of Determination Periods
                       normally ending in any year; and
                (ii)   the number of days in such Calculation Period falling in the next Determination
                       Period divided by the product of (1) the number of days in such Determination
                       Period and (2) the number of Determination Periods normally ending in any
                       year,
       where:
       ‘‘Determination Period’’ means the period from and including a Determination Date in any
       year to but excluding the next Determination Date.
       ‘‘Determination Date’’ means the date specified as such in the Subordinated Loan
       Supplement or, if none is so specified, the Interest Payment Date.]
[‘‘Fixed Amount’’ means the amount specified as such in the Subordinated Loan Supplement.
(Include, if required, in the case of fixed rate loans only)]
[‘‘Initial Interest Amount’’ means the Fixed Amount [or the Broken Amount(s), as the case may
be]. (Include, if required, in the case of fixed rate loans only)]
[‘‘Initial Interest Rate’’ means the interest rate specified as such in the Subordinated Loan
Supplement. (Include in the case of fixed rate loans only)]
‘‘Initial Interest Term’’ means the period from and including the Closing Date to but excluding the
Interest Rate Step-Up Date.
‘‘Interest Accrual Period’’ means the period beginning on (and including) the Interest
Commencement Date and ending on (but excluding) the first Interest Period Date and each
successive period beginning on (and including) an Interest Period Date and ending on (but
excluding) the next succeeding Interest Period Date.
‘‘Interest Amount’’ means [(in the case of a floating rate loan) the amount of interest payable] [(in
the case of fixed rate loans) the Initial Interest Amount during the Initial Interest Term or the
Step-Up Interest Amount during the Step-Up Interest Term, as the case may be].
[‘‘Interest Amount Step-Up Rate’’ means [specify formula, by reference to the appropriate Yield
Adjustment Rate, to calculate the Interest Amount Step-Up Rate].
‘‘Interest Commencement Date’’ means the Closing Date.
[‘‘Interest Determination Date’’ means, with respect to a Reference Rate and Interest Accrual
Period, [the date specified as such in the Subordinated Loan Supplement] [the first day of such
Interest Accrual Period (if the Specified Currency is Sterling)] [the day falling two Business Days
in London and for [specify principal financial centre of country of currency] prior to the first day of
such Interest Accrual Period (if the currency is neither Sterling nor euro)] [the day falling two
TARGET Business Days prior to the first day of such Interest Accrual Period (if the Specified
Currency is euro).] (include in the case of a floating rate loan only)]
[‘‘Interest Payment Date’’ means the dates specified as such in the Subordinated Loan Supplement.
(include in the case of a fixed rate loan only)]
‘‘Interest Period’’ means [the period beginning on (and including) the Interest Commencement
Date and ending on (but excluding) the first Interest Payment Date and each successive period
beginning on (and including) an Interest Payment Date and ending on (but excluding) the next
succeeding Interest Payment Date] [as specified in the Subordinated Loan Supplement].

                                              136
‘‘Interest Period Date’’ means [each Interest Payment Date] [as specified in the Subordinated Loan
Supplement].
[‘‘ISDA Definitions’’ means the 2000 ISDA Definitions, as published by the International Swaps
and Derivatives Association, Inc., unless otherwise specified in the relevant Loan Supplement.
(include only in the case of a floating rate loan where ISDA Determination is specified in Clause
4.1.4)]
[‘‘Margin’’ means as specified in the Subordinated Loan Supplement. (include in the case of a
floating rate loan only)]
[‘‘Rate of Interest’’ means the rate(s) of interest applicable to the Loan as determined in
accordance with this Clause 4 and the Subordinated Loan Supplement. (include in the case of a
floating rate loan only)]
[‘‘Reference Banks’’ means (in the case of a determination of LIBOR) [the principal London office
of four major banks in the London inter-bank market] (in the case of a determination of
EURIBOR) [the principal Euro-zone office of four major banks in the Euro-zone inter-bank
market] [as specified in the Subordinated Loan Supplement]in each case selected by the
Calculation Agent.] (include in the case of a floating rate loan only)]
[‘‘Reference Rate’’ means [LIBOR, EURIBOR or other reference rate]. (include in the case of a
floating rate loan only)]
[‘‘Relevant Screen Page’’ means [specify such page, section, caption, column or other part of a
particular information service]. (include in the case of a floating rate loan only)]
[‘‘Step-Up Interest Amount’’ means an amount, as determined by the Calculation Agent, equal to
the interest payable during the Step-Up Interest Term, to be calculated by applying the Interest
Amount Step-Up Rate to the Loan during the Step-Up Interest Term (include, where required, in
the case of a fixed rate loan only)]
‘‘Step-Up Interest Determination Date’’ means the second Business Day immediately preceding
the Interest Rate Step-Up Date.
‘‘Step-Up Interest Term’’ means the period from and including the Interest Rate Step-Up Date to
but excluding the Repayment Date.
‘‘Yield Adjustment Rate’’ means:
(a)   [‘‘U.S. Treasury Rate’’:
      (i)    the yield, under the heading which represents the average for the immediately
             preceding week, appearing in the most recently published statistical release designated
             ‘‘H.15(519)’’ or any successor publication which is published weekly by the Board of
             Governors of the Federal Reserve System and which established a yield for actively
             traded United States treasury notes adjusted to constant maturity under the caption
             ‘‘Treasury Constant Maturities,’’ with a maturity (or remaining maturity) closest to
             the time period from the Interest Rate Step-Up Date to the Repayment Date (if no
             maturity falls within three months before or after such time period, yields for the two
             published maturities most closely corresponding to such time period shall be
             determined and the U.S. Treasury Rate shall be interpolated or extrapolated from
             such yields on a straight-line basis, rounding to the nearest month); or
      (ii)   in the event that such yield referred to in (a) above does not appear in such statistical
             release or any such successor publication during the week preceding the Step-Up
             Interest Determination Date, the yield determined by the Calculation Agent as
             follows:
             (a)    the Calculation Agent shall request the principal New York office of each of
                    four primary United States government securities dealers to provide a
                    quotation of the yield it offers for United States treasury notes with a maturity
                    (or remaining maturity) closest to the time period from the Interest Rate
                    Step-Up Date to the Repayment Date, and determine the average of such
                    quotations (rounded, if necessary, to the nearest one thousandth of a
                    percentage point, 0.0005 per cent. being rounded upwards); and

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                    (b)     if the Calculation Agent is unable to obtain quotations and determine the
                            yield pursuant to sub-paragraph (b)(i) above, the Calculation Agent shall
                            determine, in the manner set forth in sub-paragraph (b)(i) above, the latest
                            calculable yield for United States treasury notes with a maturity (or remaining
                            maturity) closest to the time period from [insert interest rate step-up date]to
                            the Repayment Date on the latest Business Day prior to the Step-Up Interest
                            Determination Date.]
              (Use in the case of U.S. dollar denominated Loans only)
      (b)     [SPECIFY OTHER CURRENCY SPECIFIC YIELD ADJUSTMENT RATES]
4.8   Calculation Agent
      The Lender shall procure that there shall at all times be specified one or more Calculation Agents,
      which shall have been approved in advance by Sberbank, and for so long as any amount remains
      outstanding under this Agreement. Where more than one Calculation Agent is appointed in
      respect of the Loan, references in this Agreement to the Calculation Agent shall be construed as
      each Calculation Agent performing its respective duties under this Agreement. If the Calculation
      Agent is unable or unwilling to act as such or if the Calculation Agent fails duly to establish any
      Rate of Interest for an Interest Period or Interest Accrual Period or to calculate any Interest
      Amount, or to comply with any other requirement, the Lender shall (with the prior approval of
      Sberbank) appoint a leading bank or investment banking firm engaged in the interbank market (or,
      if appropriate, money, swap or over-the-counter index options market) that is most closely
      connected with the calculation or determination to be made by the Calculation Agent (acting
      through its principal London office or any other office actively involved in such market) to act as
      such in its place. The Calculation Agent may not resign its duties without a successor having been
      appointed as aforesaid. Both Sberbank and the Lender agree that such successor Calculation
      Agent will be appointed on the terms of the Agency Agreement.
5     Repayment and Prepayment
5.1   Repayment
      Except as otherwise provided herein:
      5.1.1     Sberbank shall repay the Loan and, to the extent not already paid in accordance with
                Clause [(in the case of a fixed rate loan) 4.1.2] [(in the case of a floating rate loan) 4.1.1],
                all accrued and unpaid interest, calculated to the last day of the last Interest Period, not
                later than 10:00 a.m. ([specify principal financial centre of country of currency]) one
                Business Day prior to the Repayment Date or as contemplated in Clause 11;
      5.1.2     Sberbank shall not prepay all or any part of the Loan (except with the prior consent of
                the CBR); and
      5.1.3     this Agreement may not be terminated earlier than the Interest Rate Step-Up Date.
5.2   Prepayment by Sberbank
      Notwithstanding the provisions of Clause 5.1 above, Sberbank shall be entitled, at its option, to
      prepay the Loan in whole or in part: (a) subject to the consent of the CBR, on or after the Interest
      Rate Step-Up Date, or (b) at any time if Sberbank determines that the Loan does not qualify as
      Additional Capital, in either case in an amount equal to the principal amount of the Loan to be
      prepaid plus accrued and unpaid interest on giving not less than 30 nor more than 60 days’ prior
      notice to the Lender (which notice shall be irrevocable).
5.3   Prepayment for Tax Reasons or Changes in Circumstances
      Notwithstanding the provisions of Clause 5.1 above, subject in each case to the consent of the CBR,
      if Sberbank would be required to make or increase any payment due hereunder as provided in
      Clauses 6.2 or 6.3, or if (for whatever reason) Sberbank would have to or has been required to pay
      additional amounts pursuant to Clause 8, and, in any such case, such additional amounts cannot be
      avoided by Sberbank taking reasonable measures available to it, then Sberbank may, on or after
      the Interest Rate Step-Up Date, (without premium or penalty), upon not less than 20 days’ nor
      more than 90 days’ notice to the Lender (and specifying the date of payment and including a
      certification by the principal officer of Sberbank that Sberbank would be required to increase the

                                                    138
      amount payable or to pay additional amounts, supported by an opinion of an independent tax
      adviser of recognised standing in the relevant tax jurisdiction, prepay the Loan in whole (but not
      in part) at any time.
5.4   Illegality
      Notwithstanding the provisions of Clause 5.1 above, if, at any time, by reason of the introduction
      of any change after the date of this Agreement in any applicable law or regulation or regulatory
      requirement or directive of any agency of any state (i) the Lender reasonably determines (such
      determination being accompanied by an Opinion of Counsel satisfactory to Sberbank with the cost
      of such Opinion of Counsel being borne solely by Sberbank) that it is or would be unlawful or
      contrary to such applicable law, regulation, regulatory requirement or directive for the Lender to
      allow all or part of the Loan or the Notes to remain outstanding or for the Lender to maintain or
      give effect to any of its obligations in connection with this Agreement and/or to charge or receive
      or to be paid interest at the rate then applicable to the Loan, or (ii) Sberbank reasonably
      determines (such determination being accompanied by an Opinion of Counsel satisfactory to the
      Lender, with the cost of such Opinion of Counsel being borne solely by Sberbank) that it is or
      would be unlawful or contrary to such applicable law regulation, regulatory requirement or
      directive for Sberbank to borrow the Loan or to allow all or part of the Loan to remain outstanding
      or to give effect to any of its obligations in connection with this Agreement and/or to pay interest
      at the rate then applicable to the Loan then upon notice by the Lender to Sberbank or Sberbank
      to the Lender, as applicable, in writing (setting out in reasonable detail the nature and extent of the
      relevant circumstances), Sberbank and the Lender shall consult in good faith as to a basis which
      eliminates the application of such circumstances; provided, however, that the notifying party (the
      ‘‘Notifying Party’’) shall be under no obligation to continue such consultation if a basis has not
      been determined within 30 days of the date on which it so notified the other party (the ‘‘Notified
      Party’’). If such a basis has not been determined within the 30 days, then upon notice by the
      Notifying Party to the Notified Party in writing, Sberbank shall, subject to obtaining the prior
      consent of the CBR, prepay the Loan in whole (but not in part) on such date as the Notified Party
      shall certify to be necessary to comply with such requirements.
5.5   Payment of Other Amounts/Indemnity
      If the Loan is to be prepaid by Sberbank pursuant to any of the provisions of Clauses 5.2, 5.3 or
      5.4, Sberbank shall not later than 10:00 a.m. ([specify principal financial centre of country of
      currency]) one Business Day prior to the scheduled date of prepayment also pay to the Lender
      accrued interest (calculated up to but excluding the scheduled date of prepayment), and all other
      sums payable by Sberbank pursuant to this Agreement. Sberbank shall indemnify the Lender on
      demand against all costs reasonably incurred and properly documented by the Lender in
      connection with any prepayment pursuant to this Clause 5.
5.6   Provisions Exclusive
      Sberbank may not voluntarily prepay the Loan except in accordance with the express terms of this
      Agreement. Any amount prepaid may not be reborrowed.

6     Payments
6.1   Making of Payments
      All payments of principal and interest to be made by Sberbank under this Agreement shall be
      made to the Lender not later than 10:00 a.m. ([specify principal financial centre of country of
      currency]) one Business Day prior to each Interest Payment Date or the Repayment Date (as the
      case may be) in Same-Day Funds to the Lender Account. The Lender agrees with Sberbank that
      it will not deposit any other monies into the Lender Account and that no withdrawals shall be
      made from the Lender Account other than as provided for and in accordance with the Trust Deed
      and the Agency Agreement.
6.2   No Set-Off, Counterclaim or Withholding; Gross-Up
      All payments to be made by Sberbank under this Agreement shall be made in full without set-off
      or counterclaim and (except to the extent required by law) free and clear of and without deduction
      for or on account of any Taxes. If Sberbank shall be required by applicable law to make any
      deduction or withholding from any payment under this Agreement for or on account of any Taxes,

                                                    139
      any payment due hereunder shall be increased to such amount as may be necessary to ensure that
      the Lender receives a net amount in [specify currency] equal to the full amount which it would have
      received had payment not been made subject to such Taxes, shall account to the relevant
      authorities for the relevant amount of such Taxes so withheld or deducted within the time allowed
      for such payment under the applicable law and shall deliver to the Lender without undue delay
      evidence in the form of a payment order and a letter signed by a principal officer of Sberbank (or
      such other evidence that the parties may, acting reasonably, mutually agree) of such deduction or
      withholding and of the payment thereof to the relevant Taxing Authority. If the Lender pays any
      amount in respect of such Taxes, Sberbank shall reimburse the Lender in [specify currency] for
      such payment on demand on the basis of an invoice substantially in the form set out in Schedule
      B of this Agreement. For the avoidance of doubt, this Clause 6.2 is without prejudice to the
      obligations of the Lender (or any successor thereto) pursuant to Clauses 6.5 and 6.6. The provisions
      of this Clause 6.2 shall not apply to any tax imposed on and calculated by reference to the income
      of the Lender.
6.3   Tax Indemnity
      If the Lender notifies Sberbank (setting out in reasonable detail the nature and extent of the
      obligation with such evidence as Sberbank may reasonably require) that it has become obliged to
      make any withholding or deduction for or on account of any Taxes from any payment which it is
      obliged to make in connection with its funding of the Loan, Sberbank agrees to pay to the Lender,
      not later than 10:00 a.m. ([specify principal financial centre of country of currency]) one Business
      Day prior to the date on which payment by the Lender is due in Same-Day Funds to the Lender
      Account, such additional amounts as are equal to the said additional amounts which the Lender
      must pay in connection with its funding of the Loan; provided, however, that the Lender shall
      immediately upon receipt of any sums paid pursuant to this provision, to the extent that any party
      connected to the funding of the Loan (other than the Lender) is not entitled to such additional
      amounts, pay such additional amounts to Sberbank (it being understood that the Lender shall have
      no obligation to determine whether any such party is entitled to such additional amount).
6.4   Reimbursement
      To the extent that the Lender subsequently obtains or uses any tax credit, relief or allowance or
      other reimbursements relating to a deduction or withholding with respect to which Sberbank has
      made a payment pursuant to this Clause 6 or obtains any reimbursement in connection therewith,
      it shall pay to Sberbank so much of the benefit it received as will leave the Lender, in its reasonable
      opinion, in substantially the same position as it would have been had no additional amount been
      required to be paid by Sberbank pursuant to this Clause 6 or had no reimbursement been paid to
      the Lender; provided, however, that the question of whether any such benefit has been received,
      and accordingly, whether any payment should be made to Sberbank, the amount of any such
      payment and the timing of any such payment, shall be determined solely by the Lender. The
      Lender shall have the absolute discretion whether, and in what order and manner, it claims any
      credits or refunds available to it, and the Lender shall in no circumstances be obliged to disclose
      to Sberbank any information regarding its tax affairs or computations, provided that the Lender
      shall notify Sberbank of any tax credit or allowance or other reimbursement it receives. Any such
      refund or reimbursement shall, in the absence of manifest error and subject to the Lender
      specifying in writing in reasonable detail the calculation of such credit, relief, allowance, refund or
      other reimbursement and of such payment and providing relevant supporting documents evidencing
      such matters, be conclusive evidence of the amount due to Sberbank hereunder and shall be
      accepted by Sberbank in full and final settlement of its rights of reimbursement hereunder in
      respect of such deduction or withholding.
      If as a result of a failure to obtain relief from deduction or withholding of any tax imposed by
      Russia or any Qualifying Jurisdiction (i) such tax is deducted or withheld by Sberbank and
      pursuant to this Clause 6 an increased amount is paid by Sberbank to the Lender in respect of such
      deduction or withholding and (ii) following the deduction or withholding of tax as referred to
      above the Lender applies to the relevant Russian or Qualifying Jurisdiction tax authorities for a tax
      refund and such tax refund is credited by the Russian or Qualifying Jurisdiction tax authorities to
      a bank account of the Lender, the Lender shall as soon as reasonably possible notify Sberbank of
      the receipt of such tax refund and promptly transfer the entire amount of the tax refund to a bank
      account of Sberbank specified for that purpose by Sberbank. Sberbank agrees to use its reasonable
      endeavours to assist the Lender in the making of any such application.

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6.5   Residency Certificate
      6.5.1    The Lender (and any successor thereto) shall seek to provide to Sberbank prior to the
               payment of the commission pursuant to Clause 3.2 but in any event shall provide, no later
               than 10 Business Days before the first Interest Payment Date (and thereafter as soon as
               possible at the beginning of each calendar year but not later than 10 Business Days prior
               to the first Interest Payment Date in that year) with the certificate, issued and certified by
               the competent Qualifying Jurisdiction authorities, as the case may be, confirming that the
               Lender (or such successor) is resident in a Qualifying Jurisdiction. Such certificate shall
               be appropriately apostilled.
      6.5.2    Sberbank and the Lender agree that, should the Russian legislation regulating the
               procedure for obtaining an exemption from Russian income tax withholding change then
               the procedure referred to in the above paragraph will be deemed changed accordingly.
6.6   Delivery of Forms
      The Lender (or any successor thereto) shall within 30 days of the request of Sberbank (to the
      extent it is able to do so under applicable law including Russian laws) deliver to Sberbank such
      other information or forms, including a power of attorney in form and substance acceptable to
      Sberbank authorising it to file the certificate on behalf of the Lender (or its successor) with the
      relevant tax authority, as may need to be duly completed and delivered by the Lender (or its
      successor) to enable Sberbank to obtain relief from deduction or withholding of Russian Taxes or,
      as the case may be, to obtain a tax refund if a relief from deduction or withholding of Russian Taxes
      has not been obtained. If required, the other forms referred to in this Clause 6.6 shall be duly
      signed by the Lender (or its successor) and stamped or otherwise approved by the competent tax
      authority in the Qualifying Jurisdiction and the power of attorney shall be duly signed and
      apostilled or otherwise legalised. If a relief from deduction or withholding of Russian tax or a tax
      refund under this Clause 6 has not been obtained and further to an application of Sberbank to the
      relevant Russian tax authorities the latter requests the Lender’s rouble bank account details, the
      Lender shall at the request of Sberbank (a) use reasonable efforts to procure that such rouble bank
      account of the Lender is duly opened and maintained, and (b) thereafter furnish Sberbank with the
      details of such rouble bank account. Sberbank shall provide the Lender with all assistance it may
      reasonably require to ensure that, the Lender can obtain the certificate referred to in Clause 6.5
      and deliver the certificate and complete and deliver the other information or forms specified in this
      Clause 6.6.
6.7   Mitigation
      If at any time either party hereto becomes aware of circumstances which would or might, then or
      thereafter, give rise to an obligation on the part of Sberbank to make any deduction, withholding
      or payment as described in Clauses 5.3, 6.2 or 6.3, then, without in any way limiting, reducing or
      otherwise qualifying the Lender’s rights, or Sberbank’s obligations, under such Clauses, such party
      shall promptly upon becoming aware of such circumstances notify the other party, and, thereupon
      the parties shall consider and consult with each other in good faith with a view to finding, agreeing
      upon and implementing a method or methods by which any such obligation may be avoided or
      mitigated and, to the extent that both parties can do so without taking any action which in the
      reasonable opinion of such party is prejudicial to its own position, take such reasonable steps as
      may be reasonably available to it to avoid such obligation or mitigate the effect of such
      circumstances, including in the case of the Lender (without limitation) by the transfer of its rights
      or obligations under this Agreement to another lender, provided that the Lender shall be under no
      obligation to take any such action if, in its reasonable opinion, to do so would have any adverse
      effect upon its business, operations or financial condition or would be in breach of any
      arrangements which it may have made in respect of the Notes or otherwise.

7     Conditions Precedent
7.1   Documents to be Delivered
      The obligation of the Lender to make the Advance shall be subject to the receipt by the Lender
      on or prior to the Closing Date of evidence that the persons mentioned in Clauses 14.9.6 and 14.9.7
      hereof have agreed to receive process in the manner specified therein.


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7.2   Further Conditions
      The obligation of the Lender to make the Advance shall be subject to the further conditions
      precedent that as of the Closing Date, (a) the Lender shall have received the full amount of the
      proceeds of the issue of the Notes pursuant to the Subscription Agreement, (b) the Lender shall
      have received in full the amount referred to in Clause 3.2 and (c) the Lender shall be reasonably
      satisfied that an opinion will be issued by the CBR in relation to capital treatment of this
      Agreement.

8     Change in Law or Increase in Cost
8.1   Compensation
      If, by reason of (a) any Change of Law and/or (b) change of any regulatory requirement or official
      directive (whether or not having the force of law but, if not having the force of law, the observance
      of which is in accordance with the generally accepted financial practice of similar companies in the
      country concerned) or in the interpretation or application thereof by any person charge with the
      administration thereof:
      8.1.1    the Lender incurs an additional cost as a result of the Lender’s entering into or
               performing its obligations (including its obligation to make, fund or maintain the
               Advance) under this Agreement other than any such cost incurred as a result of any
               increase in the rate of tax payable by the Lender on its income or as a result of any taxes,
               withholding or deduction, as the case may be referred to in Clause 6.2 or 6.3; or
      8.1.2    the Lender becomes liable to make any additional payment on account of tax or
               otherwise on or calculated by reference to the amount of the Advance and/or to any sum
               received or receivable by it hereunder other than any such tax on the Lender’s income or
               any tax, withholding or deduction as the case may be referred to in Clause 6.2 or 6.3;
      then Sberbank shall, on demand of the Lender, pay to the Lender amounts sufficient to hold
      harmless and indemnify it from and against, as the case may be, such properly documented (1) cost
      or (2) liability, provided that the Lender will not be entitled to indemnification where such
      additional cost or liability arises as a result of the gross negligence, fraud or wilful default of the
      Lender.
8.2   Increased Costs Claims
      If the Lender intends to make a claim pursuant to Clause 8.1, it shall promptly notify Sberbank
      thereof and provide a description in writing in reasonable detail of the relevant reason (as
      described in Clause 8.1), including a description of the relevant affected jurisdiction or country and
      the date on which the change in circumstances took effect. This written description shall
      demonstrate the connection between the change in circumstance and the additional costs and shall
      be accompanied by relevant supporting documents evidencing the matters described therein.
8.3   Mitigation
      In the event that the Lender becomes entitled to make a claim pursuant to Clause 8.1, the Lender
      shall consult in good faith with Sberbank and shall use reasonable efforts (based on the Lender’s
      reasonable interpretation of any relevant tax, law, regulation, requirement, official directive,
      request, policy or guideline) to reduce, in whole or in part, Sberbank’s obligations to pay any
      additional amount pursuant to such Clause, including by transfer of its rights or obligations under
      this Agreement to another lender, except that nothing in this Clause 8.3 shall obligate the Lender
      to incur any costs in taking any action which, in the reasonable opinion of the Lender, may be
      prejudicial to its interests.

9     Representations and Warranties
9.1   Sberbank’s Representations and Warranties
      Sberbank represents and warrants to the Lender as follows, to the extent that such shall form the
      basis of this Agreement and shall remain in full force and effect at the date hereof and shall be
      deemed to be repeated by Sberbank on the Closing Date:


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9.1.1    Sberbank is duly organised and incorporated and validly existing under the laws of Russia
         and has the power and legal right to own its property, to conduct its business as currently
         conducted and to enter into and to perform its obligations under this Agreement and to
         borrow the Advance; Sberbank has taken all necessary corporate, legal and other action
         required to authorise the borrowing of the Advance on the terms and subject to the
         conditions of this Agreement and to authorise the execution and delivery of this
         Agreement and all other documents to be executed and delivered by it in connection with
         this Agreement, and the performance of this Agreement in accordance with its terms.
9.1.2    This Agreement has been duly executed and delivered by Sberbank and constitutes a
         legal, valid and binding obligation of Sberbank enforceable in accordance with its terms,
         subject to applicable bankruptcy, insolvency, moratorium and similar laws affecting
         creditors’ rights generally, and subject, as to enforceability, (i) to general principles of
         equity (regardless of whether enforcement is sought in a proceeding in equity or at law);
         (ii) with respect to the enforceability of a judgment whether there is a federal law or a
         treaty in force relating to the mutual recognition of foreign judgments; and (iii) to the fact
         that certain gross-up and indemnity provisions may not be enforceable under Russian law.
9.1.3    The execution, delivery and performance of this Agreement by Sberbank will not conflict
         with or result in any breach or violation of (i) any law or regulation or any order of any
         governmental, judicial or public body or authority in Russia, (ii) the constitutive
         documents, rules and regulations of Sberbank or (iii) any agreement or other undertaking
         or instrument to which Sberbank is a party or which is binding upon Sberbank or any of
         its assets, nor result in the creation or imposition of any Encumbrance on any of its assets
         pursuant to the provisions of any such agreement or other undertaking or instrument.
9.1.4    All consents, authorisations, approvals or other orders of, or filings with, any governmental,
         judicial, regulatory or public body, administrative agency or other governmental body of
         Russia or any other relevant jurisdiction required by Sberbank in connection with the
         execution, delivery, performance, legality, validity, enforceability, and admissibility in
         evidence of this Agreement (subject to a Russian legal requirement to provide to a
         Russian court a duly certified translation thereof into Russian) and the issue and offering
         of the Notes have been obtained or effected and are in full force and effect.
9.1.5    No event has occurred that constitutes, or that, with the giving of notice or the lapse of
         time, or both, would to the best of Sberbank’s knowledge result in a Bankruptcy
         Proceeding, or constitute an Event of Default or a default under any agreement or
         instrument evidencing any Financial Indebtedness of Sberbank, and no such event will
         occur upon the making of the Advance.
9.1.6    There are no judicial, arbitral or administrative actions, proceedings or claims pending or,
         to the knowledge of Sberbank, threatened, against Sberbank or any of its Principal
         Subsidiaries, the adverse determination of which could have a Material Adverse Effect.
9.1.7    (i) Sberbank’s obligations under the Loan constitute direct, unconditional and unsecured
         obligations of Sberbank and (ii) based on the preliminary view of the CBR, Sberbank
         reasonably believes that the liabilities of Sberbank under this Agreement shall qualify as
         Additional Capital.
9.1.8    The IFRS Financial Statements were prepared in accordance with IFRS current as at the
         date thereof, except where specifically stated otherwise therein, and give (in conjunction
         with the notes thereto) a true and fair view of the financial condition of the Group at the
         date as of which they were prepared and the results of the Group’s operations during the
         financial years or periods then ended.
9.1.9    There has been no materially adverse change to the condition (financial or otherwise),
         prospects, results of operations or general affairs of Sberbank or the Group taken as a
         whole since 31 December ●.
9.1.10   The execution, delivery and enforceability of this Agreement is not subject to any tax,
         duty, fee or other charge, including, without limitation, any registration or transfer tax,
         stamp duty or similar levy, imposed by or within Russia or any political subdivision or
         taxing authority thereof or therein (other than state duty paid on any claim filed with a
         Russian court).

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      9.1.11   Neither Sberbank nor its property has any right of immunity from suit, execution,
               attachment or other legal process on the grounds of sovereignty or otherwise in respect
               of any action or proceeding relating in any way to this Agreement.
      9.1.12   Sberbank is in compliance in all respects with all applicable provisions of law except
               where failure to be so in compliance would not have a Material Adverse Effect.
      9.1.13   Neither Sberbank, nor any of its Principal Subsidiaries, has taken any corporate action
               nor, to the best of the knowledge and belief of Sberbank, have any other steps been taken
               or legal proceedings been started or threatened in writing against Sberbank or any of its
               Principal Subsidiaries for its bankruptcy, winding-up, dissolution, external administration
               or re-organisation (whether by voluntary arrangement, scheme of arrangement or
               otherwise) or for the appointment of a receiver, administrator, administrative receiver,
               conservator, custodian, trustee or similar officer of its or of any or all of its assets or
               revenues.
      9.1.14   There are no strikes or other employment disputes against Sberbank which are pending
               or, to Sberbank’s knowledge, threatened in writing which could have a Material Adverse
               Effect.
      9.1.15   In any proceedings taken in Russia in relation to this Agreement, the choice of English
               law as the governing law of this Agreement and any arbitration award obtained in
               England pursuant to Clause 14.9.4 in relation to this Agreement will be recognised and
               enforced in Russia after compliance with the applicable procedural rules and all other
               legal requirements in Russia.
      9.1.16   Under the laws of Russia, it will not, subject to Clauses 6.5 and 6.6, be required to make
               any deduction or withholding from any payment of principal or interest on the Loan.
      9.1.17   Its execution of this Agreement constitutes, and its exercise of its rights and performance
               of its obligations hereunder will constitute, private and commercial acts done and
               performed for private and commercial purposes.
      9.1.18   It has no overdue tax liabilities which could have a Material Adverse Effect other than
               those which it has disclosed to the Lender prior to the date hereof or which it is contesting
               in good faith.
      9.1.19   All licences, consents, examinations, clearances, filings, registrations and authorisations
               which are necessary to enable Sberbank and any of its Principal Subsidiaries to own its
               assets and carry on its business are in full force and effect where the absence of such could
               have a Material Adverse Effect.
9.2   Lender’s Representations and Warranties
      The Lender represents and warrants to Sberbank as follows:
      9.2.1    The Lender is duly incorporated under the laws of Luxembourg and has full power and
               capacity to execute the Lender Agreements and to undertake and perform the obligations
               expressed to be assumed by it herein and therein and the Lender has taken all necessary
               action to approve and authorise the same.
      9.2.2    The execution of the Lender Agreements and the undertaking and performance by the
               Lender of the obligations expressed to be assumed by it herein and therein will not
               conflict with, or result in a breach of or default under, the laws of [Luxembourg] or the
               constitutive documents, rules and regulations of the Lender or any agreement or
               instrument to which it is a party or by which it is bound or in respect of indebtedness in
               relation to which it is a surety.
      9.2.3    The Lender (i) is a société anonyme which at the date hereof is a resident of Luxembourg,
               is subject to taxation in Luxembourg on the basis of its registration as a legal entity,
               location of its management body or another similar criterion and it is not subject to
               taxation in Luxembourg merely on income from sources in Luxembourg or connected
               with property located in Luxembourg; and (ii) at the date hereof, it does not have a
               permanent establishment in Russia. The Lender (or any successor thereto) shall,
               immediately upon becoming aware of such, notify Sberbank if it ceases to be a resident
               of Luxembourg.

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       9.2.4     The Lender Agreements constitute legal, valid and binding obligations of the Lender
                 enforceable against the Lender in accordance with its terms, except that the enforcement
                 thereof may be subject to bankruptcy, insolvency, fraudulent conveyance, reorganisation,
                 moratorium and other similar laws relating to or affecting creditors’ rights generally and
                 general equitable principles.
       9.2.5     All authorisations, consents and approvals required by the Lender for or in connection
                 with the execution of the Lender Agreements, and the performance by the Lender of the
                 obligations expressed to be undertaken by it herein and therein have been obtained and
                 are in full force and effect.

10     Covenants and Reports
10.1   Capital Treatment
       To the extent that any part of the Loan is to be treated as Additional Capital by Sberbank,
       Sberbank will use its best efforts to procure that the CBR issue a final confirmation for such
       treatment, and will provide all relevant information about the Loan to the CBR as may be
       necessary for the issuance of such final confirmation.
10.2   Reports
       10.2.1    Sberbank will furnish to the Lender commencing with the year ending 31 December 2006,
                 within nine months of the relevant year-end audited annual financial statements prepared
                 in accordance with IFRS as consistently applied and in English, including a report
                 thereon by Sberbank’s certified independent accountants.
       10.2.2    Within 10 days of a request by the Lender, Sberbank shall deliver to the Lender a written
                 notice in the form of an Officer’s Certificate stating whether any Potential Event of
                 Default or Event of Default has occurred and, if it has occurred and shall be continuing,
                 what action Sberbank is taking or proposes to take with respect thereto.
       10.2.3    Sberbank will, as soon as practicable following a request of the Lender, provide the
                 Lender with such further information, other than information which Sberbank determines
                 in good faith to be confidential, about the business and financial condition of Sberbank
                 and its Subsidiaries as the Lender may reasonably request (including information referred
                 to in sub-Clauses 14.5 and 14.12 of the Principal Trust Deed).
       10.2.4    Sberbank consents that any information provided to the Lender pursuant to this
                 sub-Clause 10.2 may also be provided to the Trustee without violating any duty of
                 confidentiality or secrecy that the Lender may owe to Sberbank under the laws of
                 Luxembourg.
       10.2.5    Sberbank will at the same time as delivering its audited annual financial statements
                 pursuant to sub-Clause 10.2.1 and within 10 days of a request from the Lender, deliver to
                 the Lender an Officer’s Certificate specifying those Subsidiaries which were at a date no
                 more than 10 days before the date of such Officer’s Certificate, Principal Subsidiaries.

11     Limited Acceleration Rights
11.1   Event of Default
       If an Event of Default has occurred and is continuing, the Lender may (i) by notice in writing to
       Sberbank, declare the Facility to be cancelled whereupon the same shall herewith be cancelled;
       and/or (ii) by notice in writing to Sberbank, declare all amounts payable hereunder by Sberbank
       to be immediately due and payable (whereupon all such amounts shall become immediately due
       and payable, without diligence, presentment, demand of payment, protest or notice of any kind,
       which are expressly waived by Sberbank).
11.2   Payment Defaults
       Without prejudice to its right to enforce the obligations of Sberbank under this Agreement when
       they fall due, the Lender shall have no right to accelerate payments under this Agreement in the
       case of a default in payments of principal, interest or other amounts due under this Agreement.


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11.3   Notice of Events of Default, etc.
       Sberbank shall promptly deliver to the Lender and the Trustee, upon it becoming aware thereof,
       written notice of any event that constitutes, or that, with the giving of notice or the lapse of time,
       or both, would constitute, an Event of Default.
11.4   Rights Not Exclusive
       The Lender may not accelerate the Loan other than pursuant to Clauses 5.4 and 11.1 but, aside
       from such limited acceleration rights, the rights provided for herein are cumulative and are not
       exclusive of any other rights, powers, privileges or remedies provided by law.

12     Indemnity
12.1   Indemnification
       Sberbank undertakes to indemnify the Lender and each director, officer, employee or agent (other
       than the Principal Paying Agent or any of the Paying Agents) of the Lender (each an ‘‘Indemnified
       Party’’) against any reasonably incurred and properly documented cost, claim, loss, expense
       (including, without limitation, legal fees and expenses and any amount payable by the Lender in
       connection with its funding of any Loan or liability (but excluding any such cost, claim, loss,
       expense or liability that is the subject of the undertakings contained in Clause 13 and sub-Clauses
       14.2 and 14.6 of this Agreement) (together, a ‘‘Loss’’), together with any Russian taxes thereon,
       which an Indemnified Party may sustain or incur as a consequence of the occurrence of any default
       by Sberbank in the performance of any of the obligations expressed to be assumed by it in this
       Agreement except to the extent such Loss was due to the gross negligence, wilful default, bad faith
       or fraud of the Issuer. Except as expressly provided in the Trust Deed, the Lender shall not have
       any duty or obligation, whether as fiduciary or trustee, for any Indemnified Party or otherwise, to
       recover any such payment or to account to any other person for any amounts paid to it under this
       Clause 12.1.
       For the purposes of this Clause 12.1 a Loss shall be regarded as properly documented if it is
       supported by an itemised invoice from the Lender to Sberbank, on the headed paper of the Lender
       and signed by an authorised officer of the Lender, supported, to the extent available, by a
       documented evidence of the respective Loss.
12.2   Independent Obligation
       Clause 13.1 constitutes a separate and independent obligation of Sberbank from its other
       obligations under or in connection with this Agreement or any other obligations of Sberbank in
       connection with its receipt of the Loan and shall not affect, or be construed to affect, any other
       provision of this Agreement or any such other obligations.
12.3   Evidence of Loss
       An itemised invoice, as described in Clause 12.1 shall be prima facie evidence of the amount of
       such Loss.
12.4   Survival
       The obligations of Sberbank pursuant to Clauses 6.2 or 6.3 and 12.1 shall survive the execution and
       delivery of this Agreement, the drawdown of the Facility and the repayment of the Loan, in each
       case by Sberbank.
12.5   Lender’s Costs
       Sberbank shall, from time to time on demand of the Lender, and without prejudice to the
       provisions of Clauses 13.1 and 13.2, compensate the Lender at such daily and/or hourly rates as the
       Lender shall from time to time reasonably determine (notifying such rates to Sberbank), for all
       costs (including telephone, fax, copying, travel and such personnel costs) reasonably incurred and
       properly documented by the Lender in connection with its taking such action as it may deem
       appropriate or in complying with any request by Sberbank in connection with:
       12.5.1     the granting or proposed granting of any waiver or consent requested hereunder by
                  Sberbank;


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       12.5.2   any actual breach by Sberbank of its obligations hereunder; or

       12.5.3   any amendment or proposed amendment hereto requested by Sberbank;

       provided that before such payment is made by Sberbank, the Lender shall submit an invoice,
       substantially in the form provided in Schedule B, providing, in reasonable detail, the nature and
       calculation of the relevant payment. Subsequently, Sberbank and the Lender shall enter into and
       sign an Act of Acceptance as provided in Clause 13.3.

12.6   Payments to the Lender

       On each date on which this Agreement requires an amount denominated in [specify currency] to
       be paid by Sberbank which the Lender is then to pay in connection with the funding of the Loan,
       Sberbank shall make the same available to the Lender by payment in [specify currency] and in
       Same-Day Funds on such date, or in such other funds as may for the time being be customary in
       [specify principal financial centre of country of currency] for the settlement in [specify principal
       financial centre of country of currency] of international banking transactions in [specify currency],
       to the Lender Account. Sberbank shall procure that the bank effecting payment on its behalf
       confirms to the Lender or to such person as the Lender may direct by tested telex or authenticated
       SWIFT message three Business Days prior to the date that such payment is required to be made
       by this Agreement the payment instructions relating to such payment.

12.7   Alternative Payment Arrangements

       If, at any time, it shall become impracticable, by reason of any action of any governmental
       authority or any Change of Law, exchange control regulations or any similar event, for Sberbank
       to make payments as specified in Clause 12.5, then Sberbank may agree with the Lender
       alternative arrangements for such payments to be made; provided that, in the absence of any such
       agreement, Sberbank shall be obliged to make such payments due to the Lender in the manner
       specified herein.

13     Commissions and Costs

13.1   One-Time Commission for the Provision of the Loan by the Lender

       Sberbank shall, pursuant to sub-Clause 3.2 hereof, pay the Lender a one-time commission, in
       [specify currency] of the Lender in connection with the funding of the Loan in [specify currency],
       as supported by an invoice substantially in the form set out in Schedule B.

13.2   Payment of Ongoing Commissions, Fees and Costs

       In addition, Sberbank hereby agrees to pay to the Lender on demand in [specify currency] all
       ongoing commissions and costs (including, without limitation, enforcement costs), payable by the
       Lender under or in respect of the Lender Agreements. Sberbank shall also pay the Lender for any
       indemnification or other payment obligations of the Lender related to the funding of the Loan
       (other than the obligation of the Lender to make payments of principal, interest or additional
       amounts in respect of the Notes). Payments to the Lender referred to in this Clause 13.2 shall be
       made by Sberbank at least one Business Day before the relevant payment is to be made or
       commission or cost incurred; provided that before such payment is made by Sberbank, the Lender
       shall submit an invoice, substantially in the form provided in Schedule B, providing, in reasonable
       detail, the nature and calculation of the relevant payment. Subsequently, Sberbank and the Lender
       shall enter into and sign an Act of Acceptance as provided in Clause 13.3.

13.3   Acts of Acceptance

       In connection with all payments to be made under Clause 12 and Clause 13 and sub-Clause 14.2,
       Sberbank and the Lender shall within 60 days of such payment becoming due or such indemnity
       claim being made, enter into and sign an Act of Acceptance (which Sberbank shall prepare) with
       respect to the amounts to be paid by Sberbank. Invoices and Acts of Acceptance shall separately
       specify: (i) the net amount due, (ii) any applicable Russian taxes and (iii) the resulting total
       tax-inclusive amount.



                                                   147
14     General
14.1   Evidence of Debt
       The entries made in the Lender Account shall, in the absence of manifest error, constitute prima
       facie evidence of the existence and amounts of Sberbank’s obligations recorded therein.
14.2   Stamp Duties
       14.2.1    Sberbank shall pay all stamp, registration and documentary taxes or similar charges (if
                 any) imposed on Sberbank by any person in Russia or Luxembourg which may be
                 payable or determined to be payable in connection with the execution, delivery,
                 performance, enforcement, or admissibility into evidence of this Agreement and shall
                 indemnify the Lender against any and all costs properly documented which may be
                 incurred or suffered by the Lender with respect to, or resulting from, delay or failure by
                 Sberbank to pay such taxes or similar charges.
       14.2.2    Sberbank agrees that if the Lender incurs a liability to pay any stamp, registration and
                 documentary taxes or similar charges (if any) imposed by any person in Russia or
                 Luxembourg which may be payable or determined to be payable in connection with the
                 execution, delivery, performance, enforcement, or admissibility into evidence of this
                 Agreement, Sberbank shall reimburse the Lender on demand an amount equal to such
                 stamp or other documentary taxes or duties and shall indemnify the Lender against any
                 and all costs properly documented and connected with the payment of such amounts.
       Provided that before any such payment is made under either sub-Clause 14.2.1 or sub-Clause 14.2.2
       by Sberbank, the Lender shall submit an invoice, substantially in the form provided in Schedule B,
       providing, in reasonable detail, the nature and calculation of the relevant payment. Subsequently,
       Sberbank and the Lender shall enter into and sign an Act of Acceptance as provided in
       Clause 13.3.
14.3   Waivers
       No failure to exercise and no delay in exercising, on the part of the Lender or Sberbank, any right,
       power to privilege hereunder and no course of dealing between Sberbank and the Lender shall
       operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege
       preclude any other or further exercise thereof, or the exercise of any other right, power or
       privilege. The rights and remedies herein provided are cumulative and not exclusive of any rights,
       or remedies provided by applicable law.
14.4   Notices
       All notices, requests, demands or other communications to or upon the respective parties hereto
       shall be given or made in the English language by SWIFT, telex or courier in writing to the party
       to which such notice, request, demand or other communication is required or permitted to be given
       or made under this Agreement addressed as follows:
       14.4.1    if to Sberbank:
                 Sberbank
                 19 Vavilova Street
                 117997 Moscow
                 Russian Federation
                 Fax:                +7 495 747-3758
                 SWIFT:               SABR RU MM
                 Telex:               414733 SBRF RU
                 Attention:           [Alexander V. Tataourov/Andrey V. Trusov]
       14.4.2    if to the Lender:
                 SB Capital S.A.
                 2, Boulevard Konrad Adenauer
                 L-1115
                 Luxembourg
                 Fax:                 +352 421 22 718
                 Attention:           The Directors

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       or to such other address or SWIFT, telex or fax number as any party may hereafter specify in
       writing to the other.
       Any notice, request, demand or other communication given by courier shall be conclusively
       deemed to have been given on the day of actual delivery thereof and, if given by SWIFT, telex or
       fax, on the day of transmittal thereof, in each case if given during the normal business hours of the
       recipient, and on the business day during which such normal business hours next occur if not given
       during such hours on any day.
14.5   Assignment
       14.5.1   This Agreement shall inure to the benefit of and be binding upon the parties, their
                respective successors and any permitted assignee or transferee of some or all of a party’s
                rights or obligations under this Agreement. Any reference in this Agreement to any party
                shall be construed accordingly and, in particular, references to the exercise of rights and
                discretions by the Lender, following the enforcement of the security and/or assignment
                referred to in Clause 14.5.3 below, shall be references to the exercise of such rights or
                discretions by the Trustee (as Trustee). Notwithstanding the foregoing, the Trustee shall
                not be entitled to participate in any discussions between the Lender and Sberbank or any
                agreements of the Lender or Sberbank pursuant to Clauses 6.4 or 6.7 or Clause 8.
       14.5.2   Sberbank shall not assign or transfer all or any part of its rights or obligations hereunder
                to any other party.
       14.5.3   The Lender may assign or transfer, in whole or in part, on or at any time after the date
                of this Agreement, any of its rights and benefits or obligations under this Agreement
                (i) with the prior written consent of Sberbank to a company located in a Qualifying
                Jurisdiction and/or (ii) in connection with its funding of the Loan, by way of the charge
                by way of first fixed charge granted by the Lender and the absolute assignment by the
                Lender in favour of the Trustee (as Trustee) of the Lender’s rights and benefits under this
                Agreement and in each case under (ii) hereof Sberbank agrees that it will, on or prior to
                the Closing Date, acknowledge in writing such charge and assignment.
       14.5.4   Any references in this Agreement to any such assignee or transferee pursuant to Clause
                14.5.3 shall be construed accordingly and, in particular, references to the rights, benefits
                and obligations hereunder of the Lender, following such assignment or transfer, shall be
                references to such rights, benefits or obligations by the assignee or transferee.
14.6   Currency Indemnity
       To the fullest extent permitted by law, the obligation of Sberbank in respect of any amount due in
       [specify currency] (or such other currency as contemplated by such obligation) under this
       Agreement shall, notwithstanding any payment in any other currency (whether pursuant to a
       judgment or otherwise), be discharged only to the extent of the amount in [specify currency] (or
       such other currency as contemplated by such obligation) that the Lender may, in accordance with
       normal banking procedures, purchase with the sum paid in such other currency (after any premium
       and costs of exchange) on the Business Day immediately following the day on which the Lender
       receives such payment. If the amount in [specify currency] (or such other currency as contemplated
       by such obligation) that may be so purchased for any reason falls short of the amount originally due
       (the ‘‘Due Amount’’), Sberbank hereby agrees to indemnify and hold harmless the Lender against
       any deficiency in [specify currency]. Any obligation of Sberbank not discharged by payment in
       [specify currency] (or such other currency as contemplated by such obligation) shall, to the fullest
       extent permitted by applicable law, be due as a separate and independent obligation and, until
       discharged as provided herein, shall continue in full force and effect. If the amount in [specify
       currency] (or such other currency as contemplated by such obligation) that may be purchased
       exceeds that Due Amount the Lender shall promptly pay the amount of the excess to Sberbank.
14.7   Contracts (Rights of Third Parties) Act 1999
       A person who is not a party to this Agreement has no right under the Contracts (Rights of Third
       Parties) Act 1999 to enforce any term of this Agreement.
14.8   Choice of Law
       This Agreement shall be governed by, and construed in accordance with, the laws of England.

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14.9   Jurisdiction
       14.9.1   For the exclusive benefit of the other party, each of Sberbank and the Lender hereby
                irrevocably agrees that the courts of England shall have jurisdiction to settle any disputes
                which may arise out of or in connection with this Agreement and that accordingly any
                suit, action or proceeding (collectively, ‘‘Proceedings’’) arising out of or in connection
                with this Agreement may be brought in such courts.
       14.9.2   Each of the parties irrevocably waives any objection which it may now or hereafter have
                to the laying of the venue of any Proceedings in any such court referred to in this Clause
                14.9 and any claim that any such Proceedings have been brought in an inconvenient
                forum and further irrevocably agrees that a final and conclusive judgment in any
                Proceedings brought in the English courts with competent jurisdiction shall be conclusive
                and binding and may be enforced in the courts of any other jurisdiction.
       14.9.3   Nothing contained in this Agreement shall limit the right of any party to take Proceedings
                against another party in any other court of competent jurisdiction to the extent permitted
                by any applicable law, nor shall the taking of Proceedings in connection with this
                Agreement in one or more jurisdictions preclude the taking of Proceedings in any other
                jurisdiction or in any other court of competent jurisdiction in connection with this
                Agreement to the extent permitted by any applicable law.
       14.9.4   Each of the parties hereby agrees that, at the option of the other party, any dispute,
                controversy, claim or cause of action brought by any party against another party or arising
                out of or relating to this Agreement may be settled by arbitration in accordance with the
                Rules of the London Court of International Arbitration (‘‘LCIA’’), which rules are
                deemed to be incorporated by reference into this Clause 14.9. The place of arbitration
                shall be London, England and the language of the arbitration shall be English. The
                number of arbitrators shall be three, each of whom shall be disinterested in the dispute
                or controversy, shall have no connection with any party thereto and shall be an attorney
                experienced in international securities transactions. Each party shall nominate an
                arbitrator, who, in turn, shall nominate an additional arbitrator who shall be the
                Chairman of the Tribunal. If a dispute, claim controversy or cause of action shall involve
                more than two parties, the parties thereto shall attempt to align themselves in two sides
                (i.e., claimant and respondent) each of which shall appoint an arbitrator as if there were
                only two sides to such dispute, claim controversy or cause of action. If such alignment and
                appointment shall not have occurred within twenty (20) calendar days after the initiating
                party serves the arbitration demand or if a Chairman has not been selected within thirty
                (30) calendar days of the selection of the second arbitrator, the LCIA Arbitration Court
                shall appoint the three arbitrators or the Chairman, as the case may be. The parties and
                such Arbitration Court may appoint arbitrators from among the nationals of any country,
                whether or not a party is a national of that country. The arbitrators shall have no authority
                to award punitive or other punitive type damages and may not, in any event, make any
                ruling, finding or award that does not conform to the terms and conditions of this
                Agreement.
       14.9.5   The fact that an arbitration award has been made, the content of that award and the
                arbitration proceedings contemplated by this Clause 14 shall be kept confidential by the
                parties (other than for purposes of enforcement of the award). Costs of the arbitration
                (excluding each party’s preparation, travel, attorneys’ fees and similar costs) shall be
                borne in accordance with the decision of the arbitrators. The decision of the arbitrators
                shall be final, binding and enforceable upon the parties and judgment upon any award
                rendered by the arbitrators may be entered in any court having jurisdiction thereof. In the
                event that the failure of a party to comply with the decision of the arbitrators requires any
                other party to apply to any court for enforcement of such award, the non-complying party
                shall be liable to the other for all costs of such litigation, including reasonable attorneys’
                fees.
       14.9.6   Lender’s Process Agent: The Lender agrees that the process by which any Proceedings in
                England are begun may be served on it by being delivered to Law Debenture Corporate
                Services Limited, 5th Floor, 100 Wood Street, London EC2V 7EX, or at any other address
                for the time being at which process may be served on such person in accordance with Part

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                XXIII of the Companies Act 1985 (as modified or re-enacted from time to time). If such
                person is not or ceases to be effectively appointed to accept service of process on the
                Lender’s behalf, the Lender shall, on the written demand of Sberbank, appoint a further
                person in England to accept service of process on its behalf and, failing such appointment
                within 15 days, Sberbank shall be entitled to appoint such a person by written notice to
                the Lender. Nothing in this Clause 14.9 shall affect the right of Sberbank to serve process
                in any other manner permitted by law.
      14.9.7    Sberbank’s Process Agent: Sberbank agrees that the process by which any Proceedings in
                England are begun may be served on it by being delivered to Law Debenture Corporate
                Services Limited, 5th Floor, 100 Wood Street, London EC2V 7EX or at any other address
                for the time being at which process may be served on such person in accordance with Part
                XXIII of the Companies Act 1985 (as modified or re-enacted from time to time). If such
                person is not or ceases to be effectively appointed to accept service of process on
                Sberbank’s behalf, Sberbank shall, on the written demand of the Lender, appoint a
                further person in England to accept service of process on its behalf and, failing such
                appointment within 15 days, the Lender shall be entitled to appoint such a person by
                written notice to Sberbank. Nothing in this Clause 14.9 shall affect the right of the Lender
                to serve process in any other manner permitted by law.
14.10 Waiver of Immunity
      To the extent that Sberbank may in any jurisdiction claim for itself or its assets or revenues
      immunity from suit, execution, attachment (whether in aid of execution, before making of a
      judgment or award or otherwise) or other legal process including in relation to the enforcement of
      an arbitration award and to the extent that such immunity (whether or not claimed) may be
      attributed in any such jurisdiction to Sberbank or its assets or revenues, Sberbank agrees not to
      claim and irrevocably waives such immunity to the full extent permitted by the laws of such
      jurisdiction.
14.11 Counterparts
      This Agreement may be executed in any number of counterparts and all of such counterparts taken
      together shall be deemed to constitute one and the same agreement.
14.12 Language
      The language which governs the interpretation of this Agreement is the English language.
14.13 Amendments
      No variation of, or amendments to, this Agreement shall be of any effect unless:
      14.13.1 it is in writing and signed by the Lender and Sberbank; and
      14.13.2 to the extent required so that the Loan continues to qualify as Additional Capital, an
              amended agreement (or draft thereof) has been submitted to the CBR and approval from
              the CBR shall have been received in respect of such amended agreement.
14.14 Partial Invalidity
      The illegality, invalidity or unenforceability to any extent of any provision of this Agreement under
      the law of any jurisdiction shall affect its legality, validity or enforceability in such jurisdiction to
      such extent only and shall not affect its legality, validity or enforceability under the law of any other
      jurisdiction, nor the legality, validity or enforceability of any other provision.




                                                    151
                                           SCHEDULE A
                                Form of Subordinated Loan Supplement
This Loan Supplement is made on ● (the ‘‘Signing Date’’) between:
(1) SB Capital S.A., a société anonyme, incorporated in Luxembourg with limited liability, whose
    registered office is at 2, Boulevard Konrad Adenauer, L-1115 Luxembourg, registered with the
    Luxembourg Register of Commerce and Companies under number B-115914 (the ‘‘Lender’’); and
(2) SBERBANK, a company established under the laws of the Russian Federation whose registered
    office is at 19 Vavilova Street, Moscow 117997, Russian Federation (‘‘Sberbank’’).
Whereas:
(A) Sberbank has entered into a subordinated loan agreement dated ● (such subordinated loan
    agreement, as may be amended or supplemented from time to time, the ‘‘Subordinated Loan
    Agreement’’) with the Lender in respect of the U.S.$10,000,000,000 Programme for the issuance of
    loan participation notes by the Lender for the purpose of financing loans to Sberbank (the
    ‘‘Programme’’).
(B) Sberbank proposes to borrow ● (the ‘‘Loan’’) and the Lender wishes to make such Loan on the terms
    set out in the Subordinated Loan Agreement, as amended and supplemented by this Subordinated
    Loan Supplement (together, the ‘‘Agreement’’).
It is agreed as follows:
1   Definitions
    Capitalised terms used but not defined in this Subordinated Loan Supplement shall have the meaning
    given to them in the Subordinated Loan Agreement save to the extent supplemented or modified
    herein.
2   Additional Definitions
    For the purpose of this Subordinated Loan Supplement, the following expressions used in the
    Subordinated Loan Agreement shall have the following meanings:
    ‘‘Closing Date’’ means ●;
    ‘‘Facility’’ means the [specify currency]● subordinated loan facility made available by the Lender to
    Sberbank pursuant to the Supplemented Subordinated Loan Agreement;
    ‘‘Lender Account’’ means the account in the name of the Lender (account number ●, ●);
    ‘‘Notes’’ means ● [● per cent.] [Floating Rate] Loan Participation Notes due ● issued by the Lender
    as Series ● under the Programme;
    ‘‘Repayment Date’’ means ●; [insert date that is not less than five years from the date of the drawdown]
    ‘‘Specified Currency’’ means ●;
    ‘‘Subscription Agreement’’ means an agreement between the Lender, Sberbank and [MANAGERS]
    dated ● relating to the Notes; and
    ‘‘Trust Deed’’ means the Principal Trust Deed between the Lender and the Trustee dated ● 2006 (as
    may be amended or supplemented from time to time) as amended and supplemented by a
    Supplemental Trust Deed dated ● constituting and securing the Notes.
3   Incorporation by Reference
    Except as otherwise provided, the terms of the Subordinated Loan Agreement shall apply to this
    Subordinated Loan Supplement as if they were set out herein and the Subordinated Loan Agreement
    shall be read and construed, only in relation to the Loan constituted hereby, as one document with
    this Subordinated Loan Supplement.
4   The Loan
4.1 Drawdown
    Subject to the terms and conditions of the Agreement, the Lender agrees to make the Loan on the
    Closing Date to Sberbank and Sberbank shall make a single drawing in the full amount of the Loan.

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4.2 Interest
      The Loan is a [fixed rate][floating rate] Loan. Interest shall be calculated, and the following terms
      used in the Subordinated Loan Agreement shall have the meanings, as set out below:

      4.2.1   Fixed Rate Loan Provisions                        [Applicable/Not Applicable]
              (If not applicable, delete the remaining sub-paragraphs of this paragraph)
              (i)     Initial Rate of Interest                  ● per cent. per annum [payable
                      (Clause 4.1):                             [annually/semi-annually] in arrear
              (ii)    Interest Rate Step-Up Date                ●[insert date that is not less than five years
                      (Clause 1.1):                             from the date of the drawdown]
              (iii)   Interest Payment Date(s)                  ● in each year [adjusted in accordance with
                      (Clause 4.7):                             [specify Business Day Convention as set out in
                                                                the Subordinated Loan Agreement and any
                                                                applicable Business Centre(s) for the definition
                                                                of ‘‘Business Day’’]/not adjusted]
              (iv)    Fixed Amount[(s)]                         ● per ● in principal amount
                      (Clause 4.7):
              (v)     Broken Amount                             [Insert particulars of any initial or final broken
                      (Clause 4.7):                             interest amounts which do not correspond with
                                                                the Fixed Amount [(s)] and the Interest
                                                                Payment Date(s) to which they relate]
              (vi)    Determination Date(s)                     ● in each year. [Insert regular interest payment
                      (Clause 4.7):                             dates, ignoring issue date or maturity date in
                                                                the case of a long or short first or last interest
                                                                period](1)
              (vii)   Other terms relating to the               [Not Applicable/give details]
                      method of calculating
                      interest for fixed rate
                      Loans:

      4.2.2   Floating Rate Loan Provisions                     [Applicable/Not Applicable]
              (If not applicable, delete the remaining sub-paragraphs of this paragraph)
              (i)     Interest Commencement                     ●
                      Date:
              (ii)    Interest Period(s)                        ●
                      (Clause 4.7):
              (iii)   Specified Interest Payment                 ●
                      Dates (Clause 4.7):
              (iv)    Interest Rate Step-Up Date                ● [insert date that is not less than five years
                      (Clause 1.1):                             from the date of the drawdown]
              (v)     Interest Period Date(s)                   [Not Applicable/specify dates]
                      (Clause 4.7):
              (vi)    Screen Rate Determination                 [Applicable/Not Applicable]
                      (Clause 4.1.4):                           (If not applicable, delete the remaining
                                                                sub-paragraphs of this paragraph)
                      –    Interest Determination               [● [TARGET] Business Days in [specify city]
                           Date (Clause 4.7):                   for [specify currency] prior to [the first day in
                                                                each Interest Accrual Period/each Interest
                                                                Payment Date]]
(1)   Only to be completed for a Loan where Day Count Fraction is Actual/Actual-ICMA.




                                                          153
          (vii)   ISDA Determination                 [Applicable/Not Applicable]
                  (Clause 4.1.4):                    (If not applicable, delete the remaining
                                                     sub-paragraphs of this paragraph)
                  – Floating Rate Option:            ●
                  – Designated Maturity:             ●
                  – Reset Date:                      ●
                  – ISDA Definitions: (if             ●
                    different from those set
                    out in the Conditions):
          (viii) Margin(s) (Clause 4.7):             [+/-] ● per cent. per annum during the Initial
                                                     Interest Term and [specify formula by
                                                     reference to appropriate Yield Adjustment Rate
                                                     to calculate the adjusted Margin] during the
                                                     Step-Up Interest Term

5   One-Time Commission
    In consideration of the Lender’s undertaking to make the Loan available to Sberbank, Sberbank
    hereby agrees that it shall, two Business Days before the Closing Date, pay to the Lender, in
    Same-Day Funds, the amount of ● in respect of a one-time commission pursuant to sub-Clause 3.2
    of the Facility Agreement and supported by an invoice in the form provided in Schedule B of the
    Facility Agreement.

6   Governing Law
    This Subordinated Loan Supplement shall be governed by and construed in accordance with English
    law.




                                               154
                                            SCHEDULE B
                                            Form of Invoice
Sberbank
19 Vavilova Street
117997 Moscow
Russian Federation
1     This is an invoice submitted pursuant to Clause ● of the Subordinated Loan Agreement (the
      ‘‘Subordinated Loan Agreement’’) entered into between Sberbank as Borrower and SB Capital S.A.
      as the Lender (the ‘‘Lender’’) on ●. Terms not otherwise defined herein have the meanings ascribed
      to them in the Facility Agreement.
2     Sberbank shall pay to the Lender an amount in the total sum of ● (the ‘‘Sum’’) in connection with
      ● on ●.
3     The Sum shall be paid in ● to the following account of the Lender:
      Beneficiary: SB Capital S.A.
      Beneficiary’s account: ●
      Beneficiary’s bank: ●
      Ref: Sberbank
Please indicate your acceptance of this invoice delivered under Clause ● of the Subordinated Loan
Agreement by signing in the appropriate space below and returning to the Lender a copy hereof,
whereupon this shall be deemed accepted by Sberbank.
Yours faithfully
SB Capital S.A.
By:
Title:




                                                  155
                             TERMS AND CONDITIONS OF THE NOTES
The following is the text of the terms and conditions that, subject to completion and amendment and as
supplemented or varied in accordance with the provisions of Part A of the relevant Final Terms, shall be
applicable to the Notes in definitive form (if any) issued in exchange for the Global Note(s) representing
each Series. Either (i) the full text of these terms and conditions together with the relevant provisions of Part
A of the Final Terms or (ii) these terms and conditions as so completed, amended, supplemented or varied
(and subject to simplification by the deletion of non-applicable provisions), shall be endorsed on such Notes.
All capitalised terms that are not defined in these Conditions will have the meanings given to them in the
Trust Deed and Part A of the relevant Final Terms. Those definitions will be endorsed on the definitive
Notes. References in the Conditions to ‘‘Notes’’ are to the Notes of one Series only, not to all Notes that may
be issued under the Programme.
The Notes are constituted by, are subject to, and have the benefit of, a supplemental trust deed dated the
Issue Date specified hereon (the ‘‘Supplemental Trust Deed’’) supplemental to a trust deed dated
12 May 2006 and as may be amended or supplemented from time to time (the ‘‘Principal Trust Deed’’),
each made between SB Capital S.A. (the ‘‘Issuer’’) and J.P. Morgan Corporate Trustee Services Limited
(the ‘‘Trustee,’’ which expression shall include any trustee or trustees for the time being under the Trust
Deed) as trustee and successors thereof for the holders of the Notes (the ‘‘Noteholders’’). The Principal
Trust Deed and the Supplemental Trust Deed as modified from time to time in accordance with the
provisions therein contained and any deed or other document expressed to be supplemental thereto, as
from time to time so modified, are together referred to as the ‘‘Trust Deed.’’
The Issuer has authorised the creation, issue and sale of the Notes for the sole purpose of financing either
a Senior Loan (if the status of the Loan is specified as ‘‘Senior’’ thereon) or a Subordinated Loan (if the
status of the Loan is specified as ‘‘Subordinated’’ thereon and together with a Senior Loan, the ‘‘Loans’’,
and any one of them a ‘‘Loan’’) to Sberbank (the ‘‘Borrower’’) subject to, and in accordance with, either
(i) in relation to a Senior Loan, a facility agreement between the Issuer and the Borrower dated
12 May 2006 (such facility agreement, the ‘‘Facility Agreement’’) as amended and supplemented by a loan
supplement to be dated the Trade Date (the ‘‘Loan Supplement’’ and, together with the Facility
Agreement, the ‘‘Senior Loan Agreement’’), or (ii) in relation to a Subordinated Loan, a subordinated
loan agreement between the Issuer and the Borrower to be entered into on the Trade Date together with
a supplement thereto (together, the ‘‘Subordinated Loan Agreement’’). In these Terms and Conditions,
‘‘Loan Agreement’’ shall mean either (i) a Senior Loan Agreement (in respect of a Senior Loan) or (ii)
a Subordinated Loan Agreement (in respect of a Subordinated Loan), as applicable.
In each case where amounts of principal, interest and additional amounts (if any) are stated herein or in
the Trust Deed to be payable in respect of the Notes, the obligations of the Issuer to make any such
payment shall constitute an obligation only to account to the Noteholders on each date upon which such
amounts of principal, interest and additional amounts (if any) are due in respect of the Notes, for an
amount equivalent to sums of principal, interest and additional amounts (if any) actually received by or
for the account of the Issuer from the Borrower pursuant to the Loan Agreement.
The Issuer has charged by way of first fixed charge in favour of the Trustee certain of its rights and
interests as lender under the Loan Agreement as security for its payment obligations in respect of the
Notes and under the Trust Deed (the ‘‘Charge’’), and has assigned absolutely to the Trustee certain other
rights under the Loan Agreement (together with the Charge, the ‘‘Security Interests’’), in each case
excluding the Reserved Rights (as defined below). In certain circumstances, the Trustee can (subject to
it being indemnified and/or secured to its satisfaction) be required by Noteholders holding at least one
quarter of the principal amount of the Notes outstanding or by an Extraordinary Resolution (as defined
below) of the Noteholders to exercise certain of its powers under the Trust Deed (including those arising
under the Security Interests).
The Notes have the benefit of, and payments in respect of the Notes will be made (subject to the receipt
of the relevant funds from the Borrower) pursuant to, a paying agency agreement dated 12 May 2006 (as
may be amended or supplemented from time to time, the ‘‘Agency Agreement’’), and made between the
Issuer, JPMorgan Chase Bank, N.A., London Branch as principal paying agent, calculation agent and
transfer agent (the ‘‘Principal Paying Agent,’’ the ‘‘Calculation Agent’’ and the ‘‘Registrar’’, respectively),
JPMorgan Chase Bank, N.A., New York Branch as a paying agent and a transfer agent (a ‘‘Paying Agent’’
and ‘‘Transfer Agent’’, respectively) and the Trustee. References herein to principal paying agent,
registrar, paying agent or transfer agent, shall include any additional or successor principal paying agent,
registrar, paying agent or transfer agent.

                                                      156
Copies of the Trust Deed, the Loan Agreement, the Agency Agreement and the Final Terms are available
for inspection at the principal office of the Trustee, at the specified office of the Principal Paying Agent
and at the specified office of the Paying Agent in London.
The statements contained in these Terms and Conditions include summaries or restatements of, and are
subject to, the detailed provisions of the Trust Deed, the Loan Agreement (the form of which is scheduled
to and incorporated in the Trust Deed), the Final Terms, the Loan Supplement and the Agency
Agreement. Noteholders are entitled to the benefit of, are bound by, and are deemed to have notice of,
all the provisions thereof.
‘‘Reserved Rights’’ are the rights excluded from the Security Interest, being all and any rights, interests
and benefits of the Issuer in respect of the obligations of the Borrower (i) in respect of a Senior Series,
under Clauses 3.2, 5.3 (other than the right to receive any amount payable under such Clause), 6.2 (to the
extent that the Borrower shall reimburse the Issuer on demand for any amount paid by the Issuer in
respect of the Russian Federation taxes, penalties or interest), 6.3 (only to the extent that the Issuer has
received amounts to which the Noteholders are not entitled), 8, 12.1 – 3, 13.1, 13.2 (only to the extent that
the Borrower shall reimburse the Issuer for any amount paid by the Issuer) and 14.2 (to the extent that
the Borrower shall reimburse the Issuer for any amount paid by the Issuer in respect of such taxes, charges
or costs) of the Facility Agreement and, for the avoidance of doubt, Clauses 6.4 and 6.7 of the Facility
Agreement, and (ii) in respect of a Subordinated Series, as set out in the relevant Supplemental Trust
Deed.

1      Status
       The sole purpose of the issue of the Notes is to provide the funds for the Issuer to finance the Loan.
       The Notes constitute the obligation of the Issuer to apply the proceeds from the issue of the Notes
       solely for financing the Loan and to account to the Noteholders for an amount equivalent to sums
       of principal, interest and additional amounts (if any) actually received by or for the account of the
       Issuer pursuant to the Loan Agreement.
       The Trust Deed provides that payments in respect of the Notes equivalent to the sums actually
       received by or for the account of the Issuer by way of principal, interest or additional amounts (if
       any) pursuant to the Loan Agreement will be made pro rata among all Noteholders, on the date
       of, and in the currency of, and subject to the conditions attaching to, the equivalent payment
       pursuant to the Loan Agreement. The Issuer shall not be liable to make any payment in respect
       of the Notes other than as expressly provided herein and in the Trust Deed. As provided therein,
       neither the Issuer nor the Trustee shall be under any obligation to exercise in favour of the
       Noteholders any rights of set-off or of banker’s lien or to combine accounts or counterclaim that
       may arise out of other transactions between the Issuer and the Borrower.
       Noteholders have notice of, and have accepted, these Terms and Conditions, the Final Terms and
       the contents of the Trust Deed and the Loan Agreement, and have hereby accepted that:
       1.1      neither the Issuer nor the Trustee makes any representation or warranty in respect of, or
                shall at any time have any responsibility for, or, save as otherwise expressly provided in the
                Trust Deed or in paragraph 1.6 below, liability or obligation in respect of the performance
                and observance by the Borrower of its obligations under the Loan Agreement or the
                recoverability of any sum of principal or interest (or any additional amounts) due or to
                become due from the Borrower under the Loan Agreement;
       1.2      neither the Issuer nor the Trustee shall at any time have any responsibility for, or obligation
                or liability in respect of, the financial condition, creditworthiness, affairs, status or nature of
                the Borrower;
       1.3      neither the Issuer nor the Trustee shall at any time be liable for any representation or
                warranty or any act, default or omission of the Borrower under or in respect of the Loan
                Agreement;
       1.4      neither the Issuer nor the Trustee shall at any time have any responsibility for, or liability
                or obligation in respect of, the performance and observance by the Principal Paying Agent,
                any Paying Agent, the Registrar or Transfer Agent of their respective obligations under the
                Agency Agreement;


                                                       157
    1.5    the financial servicing and performance of the terms of the Notes depend solely and
           exclusively upon performance by the Borrower of its obligations under the Loan Agreement
           and its covenant to make payments under the Loan Agreement and its credit and financial
           standing. The Borrower has represented and warranted to the Issuer that the Loan
           Agreement constitutes a legal, valid and binding obligation of the Borrower; and
    1.6    the Issuer and the Trustee shall be entitled to rely on (i) Officer’s Certificates (as defined in
           the Loan Agreement) as to whether or not an Event of Default or Potential Event of
           Default (each as defined in the relevant Loan Agreement) has occurred and (ii) Officer’s
           Certificates specifying the Principal Subsidiaries (as defined in the Loan Agreement) of the
           Borrower and shall not otherwise be responsible for investigating any aspect of the
           Borrower’s performance in relation thereto and, subject as further provided in the Trust
           Deed, the Trustee will not be liable for any failure to make the usual or any investigations
           which might be made by a security holder in relation to the property which is the subject of
           the Trust Deed and held by way of security for the Notes, and shall not be bound to enquire
           into or be liable for any defect or failure in the right or title of the Issuer to the assigned
           property whether such defect or failure was known to the Trustee or might have been
           discovered upon examination or enquiry or whether capable of remedy or not, nor will it
           have any liability for the enforceability of the security created by the Security Interests
           whether as a result of any failure, omission or defect in registering or filing or otherwise
           protecting or perfecting such security and the Trustee has no responsibility for the value of
           such security.
    The obligations of the Issuer in respect of the Notes rank pari passu and rateably without any
    preference among themselves.
    In respect of a Note issued under a Subordinated Series (as defined in the Trust Deed) only, the
    claims of the Issuer under the Loan Agreement, excluding the Reserved Rights, constitute the
    direct, unconditional and unsecured subordinated obligations of the Borrower and will rank at
    least equally with all other unsecured and subordinated obligations of the Borrower (whether
    actual or contingent) as more fully set out in the relevant Subordinated Loan Agreement.
    In the event that the payments under the Loan Agreement are made by the Borrower to, or to the
    order of, the Trustee or (subject to the provisions of the Trust Deed) the Principal Paying Agent,
    they will pro tanto satisfy the obligations of the Issuer in respect of the Notes.
    Save as otherwise expressly provided herein and in the Trust Deed, no proprietary or other direct
    interest in the Issuer’s right under or in respect of the Loan Agreement or the Loan exists for the
    benefit of the Noteholders. Subject to the terms of the Trust Deed, no Noteholder will have any
    entitlement to enforce the Loan Agreement or direct recourse to the Borrower except through
    action by the Trustee pursuant to the relevant Security Interests granted to the Trustee in the Trust
    Deed. Neither the Issuer nor, following the enforcement of the Security Interests created in the
    Trust Deed, the Trustee shall be required to take proceedings to enforce payment under the Loan
    Agreement unless it has been indemnified and/or secured by the Noteholders to its satisfaction.
2   Form and Denomination
    The Notes will be issued in fully registered form, and in the Specified Denomination shown hereon
    or integral multiples of the Tradeable Amount in excess thereof, without interest coupons,
    provided that (i) interests in the Rule 144A Notes shall be held in amounts of not less that
    U.S.$100,000 and (ii) the minimum Specified Denomination of any Notes shall be u50,000 (or its
    equivalent in any other currency as at the date of issue of the relevant Notes).
    So long as the Notes are represented by a Global Note and the relevant clearing system(s) so permit,
    the Notes shall be tradeable only in principal amounts of at least the Specified Denomination (or, if
    more than one Specified Denomination, the lowest Specified Denomination) provided hereon and
    integral multiples of the Tradeable Amount in excess thereof provided in the relevant Final Terms.
    The Notes are Fixed Rate Notes, Floating Rate Notes, a combination of the foregoing or any other
    kind of Note, depending upon the Interest and Redemption/Payment Basis specified hereon.
3   Register, Title and Transfers
    The Registrar will maintain a register (the ‘‘Register’’) in respect of the Notes in accordance with
    the provisions of the Agency Agreement with an up-to-date copy to be kept with the Issuer at its

                                                 158
    registered office (the ‘‘Issuer’s Register’’). In these Conditions the ‘‘holder’’ of a Note means the
    person in whose name such Note is for the time being registered in the Register (or, in the case of
    a joint holding, the first named thereof) and ‘‘Noteholder’’ shall be construed accordingly. A Note
    will be issued to each Noteholder in respect of its registered holding. Under the terms of the
    Agency Agreement, the Registrar will provide to the Issuer after each such change to the Register
    an up-to-date copy of the Register to be maintained at the Issuer’s registered office. In case of
    inconsistency between the Register and the Issuer’s Register, the Issuer’s Register shall prevail.

    The holder of each Note shall (except as otherwise required by law) be treated as the absolute
    owner of such Note for all purposes (whether or not it is overdue and regardless of any notice of
    ownership, trust or any other interest therein, any writing on the Note relating thereto (other than
    the endorsed form of transfer) or any notice of any previous loss or theft of such Note) and no
    person shall be liable for so treating such holder.

    A Note may be transferred upon surrender of the relevant Note, with the endorsed form of transfer
    duly completed, at the specified office of the Registrar or at the specified office of a Transfer Agent,
    together with such evidence as the Registrar or such Transfer Agent may reasonably require to
    prove the title of the transferor and the authority of the individuals who have executed the form
    of transfer. Where not all the Notes represented by the surrendered Note are the subject of the
    transfer, a new Note in respect of the balance of the Note will be issued to the transferor.

    Subject to the last paragraph of this Condition, within five business days of the surrender of a Note
    in accordance with the immediately preceding paragraph above, the Registrar will register the
    transfer in question and deliver a new Note to each relevant holder at its specified office or (at the
    request and risk of such relevant holder) by uninsured first class mail (airmail if overseas) to the
    address specified for the purpose by such relevant holder. In this paragraph, ‘‘business day’’ means
    a day on which commercial banks are open for business (including dealings in foreign currencies)
    in the city where the Registrar has its specified office.

    The transfer of a Note will be effected without charge but against such indemnity as the Registrar
    may require in respect of any tax or other duty of whatsoever nature which may be levied or
    imposed in connection with such transfer.

    Noteholders may not require transfers to be registered during the period of 15 days ending on the
    due date for any payment of principal or interest in respect of the Notes.

4   Restrictive Covenants

    As provided in the Trust Deed, so long as any of the Notes remains outstanding (as defined in the
    Trust Deed), the Issuer will not (and will not consent to any request of the Borrower to), without
    the prior written consent of the Trustee, agree to any amendments to or any modification of (in
    each preceding case, in respect of a Note issued under a Subordinated Series only, with the consent
    of the Central Bank of Russia if applicable (the ‘‘CBR’’)) or waiver of, or authorise any breach or
    proposed breach of, the terms of the Loan Agreement and will act at all times in accordance with
    any instructions of the Trustee from time to time with respect to the Loan Agreement, except as
    otherwise expressly provided in the Loan Agreement. Any such amendment, modification, waiver
    or authorisation made with the consent of the Trustee shall be binding on the Noteholders and,
    unless the Trustee agrees otherwise, any such amendment or modification shall be notified by the
    Issuer to the Noteholders in accordance with Condition 14.

    Save as provided above, so long as any Note remains outstanding, the Issuer, without the prior
    written consent of the Trustee, shall not, inter alia, incur any other indebtedness for borrowed
    moneys (other than issuing any Series of Notes), engage in any other business (other than acquiring
    and holding the Security Interests in respect of each Series, issuing Notes and performing any act
    incidental to or necessary in connection with the foregoing), declare any dividends, have any
    subsidiaries or employees, purchase, own, lease or otherwise acquire any real property (including
    office premises or like facilities), consolidate or merge with any other person or convey or transfer
    its properties or assets substantially as an entity to any person (otherwise than as contemplated in
    these conditions and the Trust Deed), issue any shares, give any guarantee or assume any other
    liability, or subject to the laws of Luxembourg, petition for any winding-up or bankruptcy.


                                                159
5   Interest
    (a)    Interest on Fixed Rate Notes: Each Fixed Rate Note bears interest on its outstanding
           principal amount from (and including) the Interest Commencement Date at the rate(s) per
           annum (expressed as a percentage) equal to the Rate(s) of Interest specified thereon which
           shall be equal to the rate per annum at which interest under the Loan accrues. Accordingly,
           on each Interest Payment Date or as soon thereafter as the same shall be received by the
           Issuer, the Issuer shall account to the Noteholders for an amount equivalent to amounts of
           interest actually received by or for the account of the Issuer under the Loan Agreement.
           If a Fixed Coupon Amount or a Broken Amount is specified hereon, the amount of interest
           payable on each Interest Payment Date will amount to the Fixed Coupon Amount or, if
           applicable, the Broken Amount so specified and in the case of the Broken Amount will be
           payable on the particular Interest Payment Date(s) specified hereon.
    (b)    Interest on Floating Rate Notes:
           (i)     Interest Payment Dates: Each Floating Rate Note bears interest on its outstanding
                   nominal amount from (and including) the Interest Commencement Date at the rate
                   per annum (expressed as a percentage) equal to the Rate of Interest specified
                   hereon, which shall be equal to the rate per annum at which interest under the Loan
                   accrues, such interest being payable in arrear on each Interest Payment Date. Such
                   Interest Payment Date(s) is/are either shown hereon as Specified Interest Payment
                   Dates or, if no Specified Interest Payment Date(s) is/are shown hereon, Interest
                   Payment Date shall mean each date which falls the number of months or other
                   period shown hereon as the Interest Period after the preceding Interest Payment
                   Date or, in the case of the first Interest Payment Date, after the Interest
                   Commencement Date. Accordingly, on each such date or as soon thereafter as the
                   same shall be received by the Issuer, the Issuer shall account to the Noteholders for
                   an amount equivalent to amounts of interest under the Loan received by or for the
                   account of the Issuer pursuant to the Loan Agreement, as the case may be.
           (ii)    Business Day Convention: If any date referred to in these Conditions that is
                   specified to be subject to adjustment in accordance with a Business Day Convention
                   would otherwise fall on a day that is not a Business Day, then, if the Business Day
                   Convention specified is (A) the Floating Rate Business Day Convention, such date
                   shall be postponed to the next day that is a Business Day unless it would thereby fall
                   into the next calendar month, in which event (x) such date shall be brought forward
                   to the immediately preceding Business Day and (y) each subsequent such date shall
                   be the last Business Day of the month in which such date would have fallen had it
                   not been subject to adjustment, (B) the Following Business Day Convention, such
                   date shall be postponed to the next day that is a Business Day, (C) the Modified
                   Following Business Day Convention, such date shall be postponed to the next day
                   that is a Business Day unless it would thereby fall into the next calendar month, in
                   which event such date shall be brought forward to the immediately preceding
                   Business Day or (D) the Preceding Business Day Convention, such date shall be
                   brought forward to the immediately preceding Business Day.
           (iii)   Rate of Interest for Floating Rate Notes: The Rate of Interest in respect of Floating
                   Rate Notes for each Interest Accrual Period shall be determined in the manner
                   specified hereon and as set out in the Loan Agreement.
    (c)    Accrual of Interest: Interest shall cease to accrue on each Note on the due date for
           redemption unless, upon due presentation, payment is improperly withheld or refused, in
           which event interest shall continue to accrue (as well after as before judgment) at the Rate
           of Interest in the manner provided in this Condition 5 to the Relevant Date (as defined in
           Condition 8).
    (d)    Calculations: The amount of interest payable in respect of any Note for any period shall
           be calculated by multiplying the product of the Rate of Interest and the outstanding
           nominal amount of such Note by the Day Count Fraction as specified hereon and in the
           Loan Agreement, unless an Interest Amount (or a formula for its calculation) is specified
           in respect of such period, in which case the amount of interest payable in respect of such

                                                 160
          Note for such period shall equal such Interest Amount (or be calculated in accordance with
          such formula). Where any Interest Period comprises two or more Interest Accrual Periods,
          the amount of interest payable in respect of such Interest Period shall be the sum of the
          amounts of interest payable in respect of each of those Interest Accrual Periods.
    (e)   Publication of Rates of Interest and Interest Amounts: The Calculation Agent shall, as
          soon as practicable after calculating or determining the Rate of Interest and the Interest
          Amounts for each Interest Period and the relevant Interest Payment Date as set out in the
          Loan Agreement, cause such Rate of Interest and Interest Amounts to be notified to the
          Trustee, the Issuer, the Borrower, each of the Paying Agents, the Noteholders, any other
          Calculation Agent appointed in respect of the Notes that is to make a further calculation
          upon receipt of such information and, if the Notes are listed on a stock exchange and the
          rules of such exchange or other relevant authority so require, such exchange or other
          relevant authority as soon as possible after their determination but in no event later than
          (i) the commencement of the relevant Interest Period, if determined prior to such time, in
          the case of notification to such exchange of a Rate of Interest and Interest Amount, or (ii) in
          all other cases, the fourth Business Day after such determination. Where any Interest
          Payment Date or Interest Period Date is subject to adjustment pursuant to Condition
          5(b)(ii), the Interest Amounts and the Interest Payment Date so published may subsequently
          be amended (or appropriate alternative arrangements made with the consent of the Trustee
          by way of adjustment) without notice in the event of an extension or shortening of the
          Interest Period. If the Notes become due and payable as a consequence of amounts under
          the Loan Agreement becoming due and payable prior to the Repayment Date (as defined
          in the Loan Agreement), the accrued interest and the Rate of Interest payable in respect of
          the Notes shall nevertheless continue to be calculated as previously in accordance with this
          Condition but no publication of the Rate of Interest or the Interest Amount so calculated
          need be made unless the Trustee otherwise requires. The determination of any rate or
          amount, the obtaining of each quotation and the making of each determination or
          calculation by the Calculation Agent(s) shall (in the absence of manifest error) be final and
          binding upon all parties.
    (f)   Determination or Calculation by Trustee: If the Calculation Agent does not at any time
          for any reason determine or calculate the Rate of Interest for an Interest Period or any
          Interest Amount pursuant to the Loan Agreement, the Trustee shall do so (or shall appoint
          an agent on its behalf to do so) and such determination or calculation shall be deemed to
          have been made by the Calculation Agent. In doing so, the Trustee shall apply the foregoing
          provisions of this Condition, with any necessary consequential amendments, to the extent
          that, in its opinion, it can do so, and, in all other respects it shall do so in such manner as
          it shall deem fair and reasonable in all the circumstances. The Trustee shall incur no liability
          in respect of such determination or calculation.
6   Redemption and Purchase
    (a)   Final Redemption: Unless the Loan is previously prepaid or repaid pursuant to Clauses
          5.2, 5.3 or 5.4 of the Facility Agreement in the case of a Senior Series of Notes or pursuant
          to the terms of the relevant Subordinated Loan Agreement in the case of a Subordinated
          Series of Notes, the Borrower will be required to repay the Loan on the Repayment Date
          and, subject to such repayment, as set forth in the Loan Agreement, all the Notes then
          remaining outstanding will on that date be redeemed or repaid by the Issuer in the relevant
          Specified Currency on the Redemption Date specified hereon at their Final Redemption
          Amount (which, unless otherwise specified hereon, is 100 per cent. of the principal amount
          thereof).
    (b)   Early Redemption: If the Loan should become repayable in full (and be repaid in full)
          pursuant to the terms and conditions of the Loan Agreement prior to its Repayment Date,
          all Notes then remaining outstanding will thereupon become due and redeemable or
          repayable at their Early Redemption Amount (which, unless otherwise specified hereon is
          par together with interest accrued to the date of redemption) and the Issuer will endeavour
          to give not less than eight days’ notice thereof to the Trustee and the Noteholders in
          accordance with Condition 14.
          To the extent that the Issuer receives amounts of principal, interest or other amounts (other
          than amounts in respect of the Reserved Rights) following acceleration of the Loan, the

                                                161
      Issuer shall pay an amount equal to and in the same currency as such amounts on the
      business day following receipt of such amounts, subject as provided in Condition 7.

(c)   Redemption at the Option of Noteholders of a Senior Series: If a Put Option Event (as
      defined below) shall occur while a Note of any Senior Series is outstanding, the holder of
      each such Note will have the option (unless, prior to the delivery of the Put Option Notice
      referred to below, the Issuer gives notice under Condition 6(b)) to require the Issuer to
      redeem that Note) (the ‘‘Put Option’’) on the Put Option Settlement Date (as defined
      below) at its principal amount together with accrued interest and additional amounts (as
      defined in Condition 8) (if any) to the Put Option Settlement Date.

      Promptly upon the Issuer becoming aware that a Put Option Event has occurred, the Issuer
      shall give notice (a ‘‘Put Option Event Notice’’) to the Noteholders in accordance with
      Condition 14, specifying the details relating to the occurrence of the Put Option Event and
      the procedure for exercising the option contained in this Condition 6(c).

      In order to exercise the option contained in the Condition 6(c), the holder of a Note of any
      Senior Series must deliver no later than 30 days after the Put Option Event Notice is given
      (the ‘‘Put Option Period’’), to the specified office of the Principal Paying Agent or any
      Paying Agent evidence satisfactory to the Paying Agent of such holder’s entitlement to such
      Note and a duly completed put option notice (a ‘‘Put Option Notice’’) specifying the
      principal amount of the Notes in respect of which the Put Option is exercised, in the form
      obtainable from the Principal Paying Agent or any Paying Agent. The Principal Paying
      Agent or the Paying Agent will provide such Noteholder with a receipt. Provided that the
      Notes that are the subject of any such Put Option Notice have been delivered to the
      Principal Paying Agent or a Paying Agent prior to the expiry of the Put Option Period, then
      the Issuer shall (subject (i) to the receipt of sufficient funds to do so from the Borrower and
      (ii) as provided in Condition 7) redeem all such Notes on the date falling five Business Days
      after the expiration of the Put Option Period (the ‘‘Put Option Settlement Date’’). No Put
      Option Notice, once delivered in accordance with this Condition 6(c), may be withdrawn.

      For the purposes of these Conditions, a ‘‘Change of Control’’ shall occur at any time that the
      CBR and/or any other federal state agencies appropriately authorised to hold the shares of
      the Borrower (i) ceases to own or control (directly or indirectly) 50 per cent. plus one share
      of the issued and outstanding voting share capital of the Borrower; or (ii) no longer has the
      right to appoint or remove a majority of the Borrower’s supervisory council.

      ‘‘Put Option Event’’ means a Change of Control has occurred.

      This Condition 6(c) does not apply to Notes issued under a Subordinated Series.

(d)   Purchase: The Borrower or any of its Subsidiaries (as defined in the Facility Agreement)
      may at any time and from time to time purchase Notes in the open market or by tender or
      by private agreement at any price. Such Notes may be held, sold in the open market or, at
      the option of the Borrower or such Subsidiary, surrendered by the Borrower or such
      Subsidiary, as the case may be, to the Issuer for cancellation, whereupon the Issuer shall
      instruct the Principal Paying Agent to cancel such Notes. Upon such cancellation by or on
      behalf of the Principal Paying Agent, the relevant Loan shall be deemed to have been
      prepaid by the Borrower in an amount corresponding to the aggregate principal amount of
      the Notes surrendered for cancellation, together with accrued interest (if any) thereon and
      no further payments shall be made or required to be made by the Issuer in respect of such
      Notes.

      This Condition 6(d) will only apply to Notes issued under a Subordinated Series to the
      extent specified to be applicable in the relevant Final Terms.

(e)   Compulsory Sale: The Issuer may compel any beneficial owner of an interest in the
      Rule 144A Notes to sell its interest in such Notes, or may sell such interest on behalf of such
      holder, if such holder is a U.S. person that is not a qualified institutional buyer (as defined
      in Rule 144A under the Securities Act) and a qualified purchaser (as defined in Section
      2(a)(51) of the U.S. Investment Company Act of 1940).


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7   Payments and Agents
    Payments of principal shall be made against presentation and surrender of the relevant Notes at
    the specified office of the Principal Paying Agent or at the specified office of any Transfer Agent
    or of the Registrar and in the manner provided in the paragraph below.
    Interest shall be paid to the person shown on the Register at the close of business on the fifteenth
    day before the due date for payment thereof (the ‘‘Record Date’’). Payments of interest shall be
    made in the Specified Currency by cheque drawn on a bank in the principal financial centre for the
    Specified Currency or, in the case of euro, in a city in which banks have access to the TARGET
    System (a ‘‘Bank’’) and mailed to the holder (or to the first named of joint holders) of such Note
    at its address appearing in the Register. Upon application by the holder to the specified office of
    the Registrar or any Transfer Agent before the Record Date, such payment of interest may be
    made by transfer to an account in the relevant currency maintained by the payee with a Bank, or
    by transfer to an account in the Specified Currency maintained by the payee with, a Bank in the
    principal financial centre of such Specified Currency or in the case of euro, a Bank specified by the
    payee or at the option of the payee, by a euro-cheque and (in the case of interest payable on
    redemption) upon surrender of the relevant Notes at the specified office of the Principal Paying
    Agent or at the specified office of any Transfer Agent.
    All payments in respect of the Notes are subject in all cases to any applicable fiscal or other laws
    and regulations, but without prejudice to the provisions of Condition 8. No commissions or
    expenses shall be charged to the Noteholders in respect of such payments.
    If the due date for payments of interest or principal is not a business day, a Noteholder shall not
    be entitled to payment of the amount due until the next following business day and shall not be
    entitled to any further interest or other payment in respect of any such delay. In this paragraph,
    ‘‘business day’’ means a day (other than a Saturday or a Sunday) on which banks and foreign
    exchange markets are open for business in the relevant place of presentation, in such jurisdictions
    as shall be specified as ‘‘Financial Centres’’ hereon, and (i) (in the case of a payment in a currency
    other than euro) where payment is to be made by transfer to an account maintained with a bank
    in the relevant currency, on which foreign exchange transactions may be carried on in the relevant
    currency in the principal financial centre of the country of such currency or (ii) (in the case of a
    payment in euro) which is a business day on which the TARGET system is operating.
    The names of the initial Paying Agents and their initial specified offices are set out below. The
    Agency Agreement provides that the Issuer may at any time, with the prior written approval of the
    Trustee, vary or terminate the appointment of the Principal Paying Agent or any of the Paying
    Agents, and appoint additional or other paying agents provided that (i) so long as the Notes are
    listed on any stock exchange or admitted to listing by any other relevant authority, there will be a
    Paying Agent and Transfer Agent with a specified office in such place as may be required by the
    rules and regulations of the relevant stock exchange or other relevant authority and (ii) there will
    be a Paying Agent with a specified office in a European Union member state that will not be
    obliged to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any other
    European Union Directive implementing the conclusions of the ECOFIN Council meeting of
    26 – 27 November 2000 on the taxation of savings income or any law implementing or complying
    with or introduced in order to conform to such Directive. Any such variation, termination or
    appointment shall only take effect (other than in the case of insolvency, when it shall be of
    immediate effect) after not more than 45 days’ and not less than 30 days’ notice thereof shall have
    been given to the Noteholders in accordance with Condition 14.
    In addition, if the due date for redemption or repayment of a Note is not an Interest Payment Date,
    interest accrued from the preceding Interest Payment Date or, as the case may be, from the Issue
    Date as specified hereon shall be payable only as and when actually received by or for the account
    of the Issuer pursuant to the Loan Agreement.
    Save as otherwise directed by the Trustee at any time after any of the Security Interests created in
    the Trust Deed become enforceable, the Issuer will, pursuant to Clause 7 of the Agency
    Agreement require the Borrower to make all payments of principal, interest and premium (if any)
    to be made pursuant to the Loan Agreement to the Principal Paying Agent to an account in the
    name of the Issuer (the ‘‘Account’’). Under the Charge, the Issuer will charge by way of first fixed
    charge all the rights, title and interest in and to all sums of money then or in the future deposited
    in the Account in favour of the Trustee for the benefit of the Noteholders.


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8   Taxation
    All payments in respect of the Notes by or on behalf of the Issuer will be made without deduction
    or withholding for or on account of any present or future taxes or duties of whatever nature
    imposed or levied by or on behalf of the Russian Federation or Luxembourg or any authority
    thereof or therein having the power to tax, unless the deduction or withholding of such taxes or
    duties is required by law.
    In such event, the Issuer shall pay such additional payments (‘‘additional amounts’’) as shall result
    in the receipt by the Noteholders of such amount as would have been received by them if no such
    withholding or deduction had been required but only to the extent and only at such time as the
    Issuer receives an equivalent amount from the Borrower under the Loan Agreement. To the extent
    that the Issuer receives a lesser additional amount from the Borrower the Issuer will account to
    each Noteholder for an additional amount equivalent to a pro rata proportion of such additional
    amount (if any) as is actually received by, or for the account of, the Issuer pursuant to the Loan
    Agreement on the date of, in the currency of, and subject to any conditions attaching to the
    payment of such additional amount to the Issuer provided that no such additional amount will be
    payable in respect of any Note:
    8.1    to a Noteholder who (a) is able to avoid such deduction or withholding by satisfying any
           statutory requirements or by making a declaration of non-residence or other claim for
           exemption to the relevant tax authority; or (b) is liable for such taxes or duties by reason
           of his having some connection with the Russian Federation or Luxembourg other than the
           mere holding of such Note or the receipt of payments in respect thereof;
    8.2    in respect of a Note presented for payment of principal more than 30 days after the
           Relevant Date except to the extent that such additional payment would have been payable
           if such Note had been presented for payment on such 30th day;
    8.3    where such withholding or deduction is imposed on a payment to an individual and is
           required to be made pursuant to European Council Directive 2003/48/EC or any other
           European Union Directive implementing the conclusions of the ECOFIN Council meeting
           of 26-27 November 2000 on the taxation of savings income or any law implementing or
           complying with, or introduced in order to conform to, such Directive; or
    8.4    in respect of a Note presented for payment by or on behalf of a Noteholder who would have
           been able to avoid such withholding or deduction by presenting the relevant Note to
           another Paying Agent in a Member State of the European Union.
    As used herein, ‘‘Relevant Date’’ (i) means the date on which any payment under the Loan
    Agreement first becomes due but (ii) if the full corresponding amount payable has not been
    received by, or for the account of, the Issuer on or prior to such date, it means the date on which
    such moneys shall have been so received and notice to that effect shall have been duly given to the
    Noteholders by or on behalf of the Issuer in accordance with Condition 14.
    Any reference herein or in the Trust Deed to payments in respect of the Notes shall be deemed
    also to refer to any additional amounts which may be payable in accordance with the Trust Deed
    and this Condition 8 or any undertaking given in addition thereto or in substitution therefor
    pursuant to the Trust Deed.

9   Enforcement
    The Trust Deed provides that only the Trustee may pursue the remedies under the general law, the
    Trust Deed or the Notes to enforce the rights of the Noteholders and no Noteholder will be entitled
    to pursue such remedies unless the Trustee (having become bound to do so in accordance with the
    terms of the Trust Deed) fails or neglects to do so within a reasonable period and such failure or
    neglect is continuing.
    At any time after the occurrence of an Event of Default or of a Relevant Event (as defined below),
    the Trustee may, at its discretion and without notice, and shall, if requested to do so by Noteholders
    owning 25 per cent. in aggregate principal amount of the Notes outstanding, or if directed to do so
    by an Extraordinary Resolution and, in either case, subject to it being secured and/or indemnified
    to its satisfaction, (i) (in the case of an Event of Default in respect of a Note issued under a Senior
    Series only) declare all amounts payable under the Loan Agreement by the Borrower to be due
    and payable, (ii) (in the case of an Event of Default in respect of a Note issued under a

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     Subordinated Series only) take the action permitted to be taken by the Issuer under the Loan
     Agreement), or (iii) (in the case of a Relevant Event) exercise any rights under the Security
     Interests created in the Trust Deed in favour of the Trustee. Upon repayment of the Loan
     following an Event of Default and a declaration as provided herein, the Notes will be redeemed
     or repaid at their principal amount together with interest accrued to the date fixed for redemption
     and thereupon shall cease to be outstanding.
     ‘‘Relevant Event’’ means the earlier of the failure by the Issuer to make any payment of principal
     or interest on the Notes when due or the Issuer becoming insolvent or bankrupt or unable to pay
     its debts, stopping or suspending payment of all or material part (in the opinion of the Trustee) of
     its debts, proposing or making a general assignment or any arrangement or composition with or for
     the benefit of the relevant creditors in respect of any such debts or a moratorium is agreed or
     declared in respect of affecting all or (in the opinion of the Trustee) a material part of the debts
     of the Issuer or an order is made or an effective resolution is passed for the winding up or
     dissolution of the Issuer or the Issuer becomes subject to any insolvency, bankruptcy, concordat
     préventif de faillite, moratorium, controlled management (gestion contrôlée), general settlement
     with creditors, liquidation, reorganisation and any other similar legal proceedings affecting the
     Issuer or a commissaire à la gestion contrôlée, a liquidateur, a commissaire, a curateur, an
     administrateur or any similar officer is appointed as a consequence of the financial difficulties
     affecting the Issuer.

10   Meetings of Noteholders; Modification of Notes, Trust Deed and Loan Agreement; Waiver;
     Substitution of the Issuer; Appointment/Removal of Trustees
     The Trust Deed contains provisions for convening meetings of Noteholders to consider any matter
     affecting their interests, including any modification of, or any arrangement in respect of, the Notes,
     the Loan Agreement or the Trust Deed. Noteholders will vote according to the principal amount
     of their Notes. Special quorum provisions apply for meetings of Noteholders convened for the
     purpose of amending certain terms concerning, inter alia, the governing law of the Loan, the
     amount payable on, and the currency of payment in respect of, the Notes and the amounts payable
     and currency of payment under the Loan Agreement. Any resolution duly passed at a meeting of
     Noteholders will be binding on all the Noteholders, whether present or not.
     The Trustee may agree, without the consent of the Noteholders, to any modification of the Notes,
     the Trust Deed and the Loan Agreement which in the opinion of the Trustee is of a formal, minor
     or technical nature, is made to correct a manifest error or an error which is, in the opinion of the
     Trustee, proven or is not materially prejudicial to the interests of the Noteholders.
     The Trustee may also waive or authorise or agree to the waiving or authorising of any breach or
     proposed breach by the Issuer of the Terms and Conditions of the Notes or the Trust Deed or by
     the Borrower of the terms of the Loan Agreement, or determine that any event which would or
     might otherwise give rise to a right of acceleration under the Loan Agreement shall not be treated
     as such, if, in the opinion of the Trustee, to do so would not be materially prejudicial to the interests
     of the Noteholders. Any such modification, waiver or authorisation shall be binding on the
     Noteholders and, unless the Trustee agrees otherwise, any such modification shall be promptly
     notified to the Noteholders.
     The Trust Deed contains provisions to the effect that the Issuer may, and at the request of the
     Borrower shall, having obtained the consent of the Borrower (if such substitution is not to be made
     at the request of the Borrower) and the Trustee (which latter consent may be given without the
     consent of the Noteholders) and having complied with such reasonable requirements as the
     Trustee may direct in the interests of the Noteholders, substitute any entity in place of the Issuer
     as issuer and principal obligor in respect of the Notes and as principal obligor under the Trust Deed
     and as party to the Loan Agreement, subject to the relevant provisions of the Trust Deed and the
     substitute’s rights under the Loan Agreement being charged and assigned to the Trustee as security
     for the payment obligations of the substitute obligor under the Trust Deed and the Notes.
     In connection with the exercise of any of its powers, trusts, authorities or discretions, the Trustee
     shall have regard to the interests of the Noteholders as a class and, in particular, shall not have
     regard to the consequences of such exercise for individual Noteholders resulting from their being
     for any purpose domiciled or resident in, or otherwise connected with, or subject to the jurisdiction


                                                   165
     of, any particular territory. No Noteholder is entitled to claim from the Issuer or the Trustee any
     indemnification or payment in respect of any tax consequence of any such exercise upon individual
     Noteholders.
     The Trust Deed contains provision for the appointment or removal of a Trustee by a meeting of
     Noteholders passing an extraordinary resolution, provided that, in the case of the removal of a
     Trustee, at all times there remains a trustee in office after such removal. Any appointment or
     removal of a Trustee shall be notified to the Noteholders in accordance with Condition 14. The
     Trustee may also resign such appointment giving not less that three months’ notice to the
     Noteholders provided that such retirement shall not become effective unless there remains a
     trustee in office after such retirement.

11   Prescription
     Notes will become void unless presented for payment within 10 years (in the case of principal) or
     five years (in the case of interest) from the due date for payment in respect thereof.

12   Indemnification of Trustee
     The Trust Deed contains provisions for the indemnification of the Trustee and for its relief from
     responsibility, including provisions relieving it from taking proceedings to enforce payment unless
     indemnified to its satisfaction. The Trustee is entitled to enter into contracts or transactions with
     the Issuer, and/or the Borrower and any entity related to the Issuer, and/or the Borrower without
     accounting for any profit, fees, corresponding interest, discounts or share of brokerage earned,
     arising or resulting from any such contract or transactions.
     The Trustee’s responsibilities are solely those of trustee for the Noteholders on the terms of the
     Trust Deed. Accordingly, the Trustee makes no representations and assumes no responsibility for
     the validity or enforceability of the Loan Agreement or the security created in respect thereof or
     for the performance by the Issuer of its obligations under or in respect of the Notes and the Trust
     Deed or for the performance by the Borrower of its obligations under or in respect of the Loan
     Agreement. The Trustee has no liability to Noteholders for any shortfall arising from the Trustee
     being subject to tax as a result of the Trustee holding or realising the Security Interests.

13   Replacement of Notes
     If any Note shall become mutilated, defaced, lost, stolen or destroyed it may, subject to all
     applicable laws and regulations and stock exchange requirements, be replaced at the specified
     office of the Registrar or at the specified office of the Paying Agent in London or the United States
     on payment of such costs, expenses, taxes and duties as may be incurred in connection therewith
     and on such terms as to evidence, security and indemnity and otherwise as may reasonably be
     required by or on behalf of the Issuer or the Trustee. Mutilated or defaced Notes must be
     surrendered before replacements will be issued.

14   Notices
     All notices to the Noteholders shall be deemed to have been duly given if (i) posted to such holders
     at their respective addresses as shown on the Register and (ii) so long as the Notes are listed on
     the London Stock Exchange and the rules of that exchange so require, published in a daily
     newspaper of general circulation in London approved by the Trustee, currently expected to be the
     Financial Times. Any such notice shall be deemed to have been given on the first date on which
     both conditions shall have been met.
     In case by reason of any other cause it shall be impracticable to publish any notice to holders of
     Notes as provided above, then such notification to such holders as shall be given with the approval
     of the Trustee shall constitute sufficient notice to such holders for every purpose hereunder.

15   Further Issues
     The Issuer may from time to time, without the consent of the Noteholders, create and issue further
     Notes having the same terms and conditions as the Notes in all respects (or in all respects except
     for the amount and the date of the first payment of interest) so as to be consolidated and form a


                                                 166
     single series with the Notes. Such further Notes shall be constituted by a deed supplemental to the
     Trust Deed between the Issuer and the Trustee. The Trust Deed contains provisions for convening
     a single meeting of Noteholders and the holders of Notes of other series in certain circumstances
     where the Trustee so decides. In relation to any further issue which is to be consolidated and form
     a single series with the Notes, (i) the Issuer will enter into a loan agreement supplemental to the
     Loan Agreement with the Borrower on substantially the same terms as the Loan Agreement (or
     in all respects except for the amount and the date of the first payment of interest on the further
     Loan) and (ii) the Security Interests granted in respect of the Notes will be amended or
     supplemented so as to secure amounts due in respect of such further Notes also and/or the Issuer
     will provide a further fixed charge in favour of the Trustee in respect of certain of its rights and
     interests under any further Loan Agreement as so amended and will assign absolutely certain of
     its rights under such Loan Agreement as amended to secure amounts due on the Notes and such
     further Notes.

16   Contracts (Rights of Third Parties) Act 1999
     No person shall have any right to enforce any term or condition of the Notes under the Contracts
     (Rights of Third Parties) Act 1999.

17   Governing Law
     The Notes, the Agency Agreement and the Trust Deed are governed by, and shall be construed in
     accordance with, English law. The Issuer has submitted in the Trust Deed to the jurisdiction of the
     courts of England and has appointed an agent for the service of process in England. The provisions
     of articles 86 to 94-8 of the Luxembourg law of 10 August 1915, as amended, on commercial
     companies are excluded.




                                                 167
     SUMMARY OF THE PROVISIONS RELATING TO THE NOTES IN GLOBAL FORM

The Global Notes
Each Series of Notes will be evidenced on issue (i) in the case of Regulation S Notes, a Regulation S
Global Note deposited with, and registered in the name of a nominee for, a common depositary for
Euroclear and Clearstream, Luxembourg and (ii) in the case of Rule 144A Notes, a Rule 144A Global
Note deposited with a custodian for, and registered in the name of Cede & Co. as nominee of, DTC.
Beneficial interests in a Regulation S Global Note may be held only through Euroclear or Clearstream,
Luxembourg at any time. See ‘‘—Book-Entry Procedures for the Global Notes.’’ By acquisition of a
beneficial interest in a Regulation S Global Note, the purchaser thereof will be deemed to represent,
among other things, that it is not a U.S. person and that, prior to the expiration of 40 days after completion
of the distribution of the Series of which such Notes are a part as determined and certified to the Principal
Paying Agent by the relevant Dealer (or in the case of a Series of Notes sold to or through more than one
relevant Dealer, by each of such relevant Dealers as to the Notes of such Series sold by or through it, in
which case the Principal Paying Agent shall notify each such relevant Dealer when all relevant Dealers
have so certified (the ‘‘distribution compliance period’’)), it will not offer, sell, pledge or otherwise transfer
such interest except to a person whom the seller reasonably believes to be a non-U.S. person in an
offshore transaction in accordance with Rule 903 or Rule 904 of Regulation S. See ‘‘Transfer
Restrictions.’’ Beneficial interests in a Rule 144A Global Note may only be held through DTC at any time.
See ‘‘—Book-Entry Procedures for the Global Notes.’’ By acquisition of a beneficial interest in a Rule
144A Global Note, the purchaser thereof will be deemed to represent, among other things, that if it is a
U.S. person (within the meaning of Regulation S), it is a QIB that is also a QP and that, if in the future
it determines to transfer such beneficial interest, it will transfer such interest in accordance with the
procedures and restrictions contained in the Agency Agreement. See ‘‘Transfer Restrictions.’’
Beneficial interests in each Global Note will be subject to certain restrictions on transfer set forth therein
and in the Agency Agreement, and with respect to Rule 144A Global Note, as set forth in Rule 144A, and
the Rule 144A Notes will bear the legends set forth thereon regarding such restrictions set forth under
‘‘Transfer Restrictions.’’ A beneficial interest in a Regulation S Global Note may be transferred to a
person who takes delivery in the form of an interest in a Rule 144A Global Note in denominations greater
than or equal to the minimum denominations applicable to interests in a Rule 144A Global Note and only
upon receipt by the Registrar of a written certification (in the form provided in the Paying Agency
Agreement) to the effect that the transferor reasonably believes that the transferee is a QIB that is also
a QP and that such transaction is in accordance with any applicable securities laws of any state of the
United States or any other jurisdiction. Beneficial interests in a Rule 144A Global Note may be
transferred to a person who takes delivery in the form of an interest in a Regulation S Global Note only
upon receipt by the Registrar of a written certification (in the form provided in the Paying Agency
Agreement) from the transferor to the effect that the transfer is being made to a non-U.S. person and in
accordance with Regulation S.
Any beneficial interest in a Regulation S Global Note that is transferred to a person who takes delivery
in the form of an interest in a Rule l44A Global Note will, upon transfer, cease to be an interest in the
Regulation S Global Note and become an interest in the Rule 144A Global Note, and, accordingly, will
thereafter be subject to all transfer restrictions and other procedures applicable to beneficial interests in
the Rule 144A Global Note for as long as it remains such an interest. Any beneficial interest in a Rule
144A Global Note that is transferred to a person who takes delivery in the form of an interest in a
Regulation S Global Note will, upon transfer, cease to be an interest in the Rule 144A Global Note and
become an interest in the Regulation S Global Note and, accordingly, will thereafter be subject to all
transfer restrictions and other procedures applicable to beneficial interests in the Regulation S Global
Note for so long as it remains such an interest. No service charge will be made for any registration of
transfer or exchange of Notes, but the Registrar may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith. Except in the limited circumstances
described below, owners of beneficial interests in Global Notes will not be entitled to receive physical
delivery of certificated Notes in definitive form (the ‘‘Definitive Notes’’). The Notes are not issuable in
bearer form.




                                                      168
Amendments to Conditions
Each Global Note contains provisions that apply to the Notes that they represent, some of which modify
the effect of the above Terms and Conditions of the Notes. The following is a summary of those
provisions:
•   Payments. Payments of principal and interest in respect of Notes evidenced by a Global Note will
    be made against presentation for endorsement by the Principal Paying Agent and, if no further
    payment falls to be made in respect of the relevant Notes, surrender of such Global Note to or to the
    order of the Principal Paying Agent or such other Paying Agent as shall have been notified to the
    relevant Noteholders for such purpose. A record of each payment so made will be endorsed in the
    appropriate schedule to the relevant Global Note, which endorsement will be prima facie evidence
    that such payment has been made in respect of the relevant Notes.
•   Notices. So long as any Notes are evidenced by a Global Note and such Global Note is held by or
    on behalf of a clearing system, notices to Noteholders may be given by delivery of the relevant notice
    to that clearing system for communication by it to entitled account holders in substitution for delivery
    thereof as required by the Terms and Conditions of such Notes provided that for so long as the Notes
    are listed on the London Stock Exchange and the rules of the London Stock Exchange so require,
    notices will also be published in a leading newspaper having general circulation in England (which
    is expected to be the Financial Times).
•   Meetings. The holder of each Global Note will be treated as being one person for the purposes of
    any quorum requirements of, or the right to demand a poll at, a meeting of Noteholders and in any
    such meeting as having one vote in respect of each Note for which the relevant Global Note may be
    exchangeable.
•   Trustee’s Powers. In considering the interests of Noteholders whilst the relevant Global Note is held
    on behalf of a clearing system, the Trustee, to the extent it considers it appropriate to do so in the
    circumstances, may have regard to any information provided to it by such clearing system or its
    operator as to the identity (either individually or by category) of its accountholders with entitlements
    to such Global Note and may consider such interests as if such accountholders were the holders of
    such Global Note.
•   Cancellation. Cancellation of any Note required by the Terms and Conditions of the Notes to be
    cancelled will be effected by reduction in the principal amount of the applicable Global Note.
•   Redemption at the Option of Noteholders. If a Put Option (as defined in the ‘‘Terms and Conditions
    of the Notes’’) occurs, the Issuer must, upon becoming aware of the occurrence of a Change of
    Control, promptly give notice to the Noteholders in accordance with the ‘‘Terms and Conditions of
    the Notes’’ and the standard procedures of DTC, Euroclear and Clearstream, Luxembourg of such
    Change of Control. For so long as all of the Notes are represented by the Global Notes and such
    Global Notes are held on behalf of Euroclear and/or Clearstream, Luxembourg and DTC, as
    applicable, such option of the Noteholders to require redemption of the Notes may be exercised by
    an accountholder (shown in the records of Euroclear and/or Clearstream, Luxembourg and DTC, as
    applicable, as the holder of Notes) giving notice to a Paying Agent in accordance with the standard
    procedures of Euroclear, Clearstream, Luxembourg and DTC of the principal amount of the Notes
    in respect of which such option is to be exercised, not later than 30 days after the Issuer has given the
    notice of the Change of Control referred to above. Following presentation of the relevant Global
    Notes to the Principal Paying Agent for notation, the Issuer shall (subject to certain limitations on
    the obligation of payment of the Issuer in Condition 7) redeem the relevant proportion of each
    Global Note five business days after the expiration of the 30 day period detailed above and the
    Paying Agent will mark down the Global Notes in accordance with the terms of the Agency
    Agreement. This paragraph does not apply to Notes issued under a Subordinated Series.

Exchange for Definitive Notes

Exchange
Each Global Note will be exchangeable, free of charge to the holder, in whole but not in part, for Notes
in definitive, registered form if: (i) a Global Note is held by or on behalf of (A) DTC, and DTC notifies
the Issuer that it is no longer willing or able to discharge properly its responsibilities as depositary with
respect to the Global Note or ceases to be a ‘‘clearing agency’’ registered under the U.S. Securities

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Exchange Act of 1934 (the ‘‘Exchange Act’’) or if at any time it is no longer eligible to act as such, and
the Issuer is unable to locate a qualified successor within 90 days of receiving notice or becoming aware
of such ineligibility on the part of DTC or (B) Euroclear or Clearstream, Luxembourg, and Euroclear or
Clearstream, Luxembourg, as the case may be, is closed for business for a continuous period of 14 days
(other than by reason of holidays, statutory or otherwise) or announces an intention permanently to cease
business or does in fact do so, by the holder giving notice to the Registrar or any Transfer Agent or
(ii) if the Issuer would suffer a material disadvantage in respect of the Notes as a result of a change in the
laws or regulations (taxation or otherwise) of any jurisdiction referred to in Condition 8 which would not
be suffered were the Notes in definitive form and a notice to such effect signed by two directors of the
Issuer is delivered to the Trustee, by the Issuer giving notice to the Registrar or any Transfer Agent and
the Noteholders, of its intention to exchange the relevant Global Note for Definitive Notes on or after the
Exchange Date (as defined below) specified in the notice.
On or after the Exchange Date, the holder of the relevant Global Note may surrender such Global Note
to or to the order of the Registrar or any Transfer Agent. In exchange for the relevant Global Note, as
provided in the Paying Agency Agreement, the Registrar will deliver, or procure the delivery of, an equal
aggregate amount of duly executed and authenticated Definitive Notes in or substantially in the form set
out in the relevant schedule to the Trust Deed.
The Registrar will not register the transfer of, or exchange of interests in, a Global Note for definitive
Notes for a period of 15 calendar days ending on the date for any payment of principal or interest or on
the date of optional redemption in respect of the Notes.
‘‘Exchange Date’’ means a day falling not later than 90 days after that on which the notice requiring
exchange is given and on which banks are open for business in the city in which the specified office of the
Registrar or the Transfer Agent is located.

Delivery
In such circumstances, the relevant Global Note shall be exchanged in full for definitive Notes and the
Issuer will, at the cost of Sberbank (but against such indemnity as the Registrar or any relevant Transfer
Agent may require in respect of any tax or other duty of whatever nature which may be levied or imposed
in connection with such exchange), cause sufficient Definitive Notes to be executed and delivered to the
Registrar for completion, authentication and dispatch to the relevant Noteholders. A person having an
interest in a Global Note must provide the Registrar with (a) a written order containing instructions and
such other information as the Issuer and the Registrar may require to complete, execute and deliver such
Notes and (b) in the case of a Rule 144A Global Note only, a fully completed, signed certification
substantially to the effect that the exchanging holder is not transferring its interest at the time of such
exchange or, in the case of simultaneous sale pursuant to Rule l44A, a certification that the transfer is
being made in compliance with the provisions of Rule l44A to a QIB that is also a QP. Definitive Notes
issued in exchange for a beneficial interest in a Rule 144A Global Note shall bear the legend applicable
to transfers pursuant to Rule 144A, as set out under ‘‘Transfer Restrictions.’’

Legends
The holder of a Definitive Note may transfer the Notes evidenced thereby in whole or in part in the
applicable minimum denomination by surrendering it at the specified office of the Registrar or any
Transfer Agent, together with the completed form of transfer thereon. Upon the transfer, exchange or
replacement of a Rule 144A Definitive Note bearing the legend referred to under ‘‘Transfer Restrictions,’’
or upon specific request for removal of the legend on a Rule 144A Definitive Note, the Issuer will deliver
only Rule 144A Definitive Notes that bear such legend, or will refuse to remove such legend, as the case
may be, unless there is delivered to the Issuer and the Registrar such satisfactory evidence, which may
include an opinion of counsel, as may reasonably be required by the Issuer that neither the legend nor the
restrictions on transfer set forth therein are required to ensure compliance with the provisions of the
Securities Act and the Investment Company Act.

Book-Entry Procedures for the Global Notes
For each Series of Notes evidenced by both a Regulation S Global Note and a Rule 144A Global Note,
custodial and depository links are to be established between DTC, Euroclear and Clearstream,
Luxembourg to facilitate the initial issue of the Notes and cross-market transfers of the Notes associated
with secondary market trading. See ‘‘—Book Entry Ownership—Settlement and Transfer of Notes.’’

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Euroclear and Clearstream, Luxembourg
Euroclear and Clearstream Luxembourg each hold securities for their customers and facilitate the
clearance and settlement of securities transactions through electronic book-entry transfer between their
respective accountholders. Indirect access to Euroclear and Clearstream, Luxembourg is available to
other institutions which clear through or maintain a custodial relationship with an accountholder of either
system. Euroclear and Clearstream, Luxembourg provide various services including safekeeping,
administration, clearance and settlement of internationally-traded securities and securities lending and
borrowing. Euroclear and Clearstream, Luxembourg also deal with domestic securities markets in several
countries through established depository and custodial relationships. Euroclear and Clearstream,
Luxembourg have established an electronic bridge between their two systems across which their
respective customers may settle trades with each other. Their customers are worldwide financial
institutions including underwriters, securities brokers and dealers, banks, trust companies and clearing
corporations. Investors may hold their interests in such Global Notes directly through Euroclear or
Clearstream, Luxembourg if they are accountholders (‘‘Direct Participants’’) or indirectly
(‘‘Indirect Participants’’ and together with Direct Participants, ‘‘Participants’’) through organisations
which are accountholders therein.

DTC
DTC has advised the Issuer as follows: DTC is a limited purpose trust company organised under the laws
of the State of New York, a ‘‘banking organisation’’ under the laws of the State of New York, a member
of the U.S. Federal Reserve System, a ‘‘clearing corporation’’ within the meaning of the New York
Uniform Commercial code and a ‘‘clearing agency’’ registered pursuant to the provisions of Section
17A of the Exchange Act. DTC was created to hold securities for its Participants and facilitate the
clearance and settlement of securities transactions between Participants through electronic computerised
book-entry changes in accounts of its Participants, thereby eliminating the need for physical movement
of certificates. Participants include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organisations. Indirect access to DTC is available to others, such as banks,
securities brokers, dealers and trust companies, that clear through or maintain a custodial relationship
with a DTC Direct Participant, either directly or indirectly.
Investors may hold their interests in Rule 144A Global Notes directly through DTC if they are Direct
Participants in the DTC system, or as Indirect Participants through organisations which are Direct
Participants in such system.
DTC has advised the Issuer that it will take any action permitted to be taken by a holder of Notes only
at the direction of one or more Direct Participants and only in respect of such portion of the aggregate
principal amount of the relevant Rule 144A Global Notes as to which such Participant or Participants has
or have given such direction. However, in the circumstances described under ‘‘Exchange for Definitive
Notes,’’ DTC will surrender the relevant Rule l44A Global Notes for exchange for individual Rule 144A
Definitive Notes (which will bear the legend applicable to transfers pursuant to Rule 144A).

Book-Entry Ownership

Euroclear and Clearstream, Luxembourg
The Regulation S Global Note representing Regulation S Notes of any Series will have an International
Securities Identification Number (‘‘ISIN’’) and a Common Code and will be registered in the name of a
nominee for, and deposited with a common depositary on behalf of, Euroclear and Clearstream,
Luxembourg. The address of Euroclear is 1 Boulevard du Roi Albert II, B1210 Brussels, Belgium, and the
address of Clearstream, Luxembourg is 42 Avenue J.F. Kennedy, L-1855 Luxembourg.

DTC
The Rule 144A Global Note representing Rule 144A Notes of any Series will have a CUSIP number and
will be deposited with a custodian for and registered in the name of Cede & Co. as nominee of, DTC. The
Custodian and DTC will electronically record the principal amount of the Notes held within the DTC
System. The address of DTC is 55 Water Street, New York, New York 10041, USA.

Relationship of Participants with Clearing Systems
Each of the persons shown in the records of Euroclear, Clearstream, Luxembourg or DTC as the holder
of a Note evidenced by a Global Note must look solely to Euroclear, Clearstream, Luxembourg or DTC

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(as the case may be) for his share of each payment made by the Issuer to the holder of such Global Note
and in relation to all other rights arising under the Global Note, subject to and in accordance with the
respective rules and procedures of Euroclear, Clearstream, Luxembourg or DTC (as the case may be).
The Issuer expects that, upon receipt of any payment in respect of Notes evidenced by a Global Note, the
common depositary by whom such Note is held, or nominee in whose name it is registered, will
immediately credit the relevant participants’ or accountholders’ accounts in the relevant clearing system
with payments in amounts proportionate to their respective beneficial interests in the principal amount of
the relevant Global Note as shown on the records of the relevant clearing system or its nominee. The
Issuer also expects that payments by Direct Participants in any clearing system to owners of beneficial
interests in any Global Note held through such Direct Participants in any clearing system will be governed
by standing instructions and customary practices. Save as aforesaid, such persons shall have no claim
directly against the Issuer in respect of payments due on the Notes for so long as the Notes are evidenced
by such Global Note and the obligations of the Issuer will be discharged by payment to the registered
holder, as the case may be, of such Global Note in respect of each amount so paid. None of the Issuer,
the Trustee or any Agent will have any responsibility or liability for any aspect of the records relating to
or payments made on account of ownership interests in any Global Note or for maintaining, supervising
or reviewing any records relating to such ownership interests.

Settlement and Transfer of Notes
Subject to the rules and procedures of each applicable clearing system, purchases of Notes held within a
clearing system must be made by or through Direct Participants, which will receive a credit for such Notes
on the clearing system’s records. The ownership interest of each actual purchaser of each such Note (the
‘‘Beneficial Owner’’) will in turn be recorded on the Direct and Indirect Participants’ records. Beneficial
Owners will not receive written confirmation from any clearing system of their purchase, but Beneficial
Owners are expected to receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Direct or Indirect Participant through which such
Beneficial Owner entered into the transaction.
Transfers of ownership interests in Notes held within the clearing system will be affected by entries made
on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in such Notes, unless and until interests in any Global
Note held within a clearing system are exchanged for Definitive Notes.
No clearing system has knowledge of the actual Beneficial Owners of the Notes held within such clearing
system and their records will reflect only the identity of the Direct Participants to whose accounts such
Notes are credited, which may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and
other communications by the clearing systems to Direct Participants, by Direct Participants to Indirect
Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed
by arrangements among them, subject to any statutory or regulatory requirements as may be in effect
from time to time.
The laws of some jurisdictions may require that certain persons take physical delivery in definitive form
of securities. Consequently, the ability to transfer interests in a Global Note to such persons may be
limited. Because DTC can only act on behalf of Direct Participants, who in turn act on behalf of Indirect
Participants, the ability of a person having an interest in a Rule l44A Global Note to pledge such interest
to persons or entities that do not participate in DTC, or otherwise take actions in respect of such interest,
may be affected by a lack of physical certificate in respect of such interest.

Trading between Euroclear and/or Clearstream, Luxembourg Participants
Secondary market sales of book-entry interests in the Notes held through Euroclear or Clearstream,
Luxembourg to purchasers of book-entry interests in the Notes held through Euroclear or Clearstream,
Luxembourg will be conducted in accordance with the normal rules and operating procedures of
Euroclear and Clearstream, Luxembourg and will be settled using the procedures applicable to
conventional Eurobonds.

Trading between DTC Participants
Secondary market sales of book-entry interests in the Notes between DTC participants will occur in the
ordinary way in accordance with DTC rules and will be settled using the procedures applicable to United

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States corporate debt obligations in DTC’s Same-Day Funds Settlement (‘‘SDFS’’) system in same-day
funds, if payment is effected in U.S. dollars, or free of payment, if payment is not effected in U.S. dollars.
Where payment is not effected in U.S. dollars, separate payment arrangements outside DTC are required
to be made between the DTC participants.
Trading between DTC Seller and Euroclear/Clearstream, Luxembourg Purchaser
When book-entry interests in Notes are to be transferred from the account of a DTC participant holding
a beneficial interest in a Rule 144A Global Note to the account of a Euroclear or Clearstream,
Luxembourg accountholder wishing to purchase a beneficial interest in a Regulation S Global Note
(subject to the certification procedures provided in the Agency Agreement), the DTC participant will
deliver instructions for delivery to the relevant Euroclear or Clearstream, Luxembourg accountholder to
DTC by 12 noon, New York time, on the settlement date. Separate payment arrangements are required
to be made between the DTC participant and the relevant Euroclear or Clearstream, Luxembourg
participant. On the settlement date, the custodian of the Rule l44A Global Note will instruct the Registrar
to (i) decrease the amount of Notes registered in the name of Cede & Co. and evidenced by the Rule
144A Global Note of the relevant class and (ii) increase the amount of Notes registered in the name of
the nominee of the common depositary for Euroclear and Clearstream, Luxembourg and evidenced by
the Regulation S Global Note. Book-entry interests will be delivered free of payment to Euroclear or
Clearstream, Luxembourg, as the case may be, for credit to the relevant accountholder on the first
business day following the settlement date.
Trading between Euroclear/Clearstream, Luxembourg Seller and DTC Purchaser
When book-entry interests in the Notes are to be transferred from the account of a Euroclear or
Clearstream, Luxembourg accountholder to the account of a DTC participant wishing to purchase a
beneficial interest in a Rule l44A Global Note (subject to the certification procedures provided in the
Agency Agreement), the Euroclear or Clearstream, Luxembourg participant must send to Euroclear or
Clearstream, Luxembourg delivery free of payment instructions by 7:45 p.m., Brussels or Luxembourg
time, one business day prior to the settlement date. Euroclear or Clearstream, Luxembourg, as the case
may be, will in turn transmit appropriate instructions to the common depositary for Euroclear and
Clearstream, Luxembourg and the Registrar to arrange delivery to the DTC participant on the settlement
date. Separate payment arrangements are required to be made between the DTC participant and the
relevant Euroclear or Clearstream, Luxembourg accountholder, as the case may be. On the settlement
date, the common depositary for Euroclear and Clearstream, Luxembourg will (a) transmit appropriate
instructions to the custodian of the Rule 144A Global Note who will in turn deliver such book-entry
interests in the Notes free of payment to the relevant account of the DTC participant and (b) instruct the
Registrar to (i) decrease the amount of Notes registered in the name of the nominee of the common
depositary for Euroclear and Clearstream, Luxembourg and evidenced by a Regulation S Global Note;
and (ii) increase the amount of Notes registered in the name of Cede & Co. and evidenced by a Rule 144A
Global Note.
Although Euroclear, Clearstream, Luxembourg and DTC have agreed to the foregoing procedures in
order to facilitate transfers of beneficial interest in Global Notes among participants and accountholders
of Euroclear, Clearstream, Luxembourg and DTC, they are under no obligation to perform or continue
to perform such procedure, and such procedures may be discontinued at any time. None of the Issuer, the
Trustee or any Agent will have the responsibility for the performance by Euroclear, Clearstream,
Luxembourg or DTC or their respective Direct or Indirect Participants of their respective obligations
under the rules and procedures governing their operations.
Pre-issue Trades Settlement
It is expected that delivery of Notes will be made against payment thereof on the Closing Date thereof,
which could be more than three business days following the date of pricing. Under Rule 15c6-1 under the
Exchange Act, trades in the United States secondary market generally are required to settle within three
business days (T+3), unless the parties to any such trade expressly agree otherwise. Accordingly,
purchasers who wish to trade Notes in the United States on the date of pricing or the next succeeding
business days until three days prior to the relevant Closing Date will be required, by virtue of the fact the
Notes initially will settle beyond T+3, to specify an alternate settlement cycle at the time of any such trade
to prevent a failed settlement. Settlement procedures in other countries will vary. Purchasers of Notes may
be affected by such local settlement practices, and purchasers of Notes between the relevant date of
pricing and the relevant Closing Date should consult their own advisers.

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                                       SUBSCRIPTION AND SALE

Summary of Dealer Agreement
Subject to the terms and on the conditions contained in a Dealer Agreement dated May 12, 2006 (the
‘‘Dealer Agreement’’) between the Issuer, Sberbank, the Permanent Dealers and the Arrangers, the
Notes will be offered from time to time by the Issuer to the Permanent Dealers or such other Dealers as
may be appointed from time to time in respect of any Series of Notes pursuant to the Dealer Agreement.
Any agreement for the sale of Notes will, inter alia, make provision for the form and terms and conditions
of the relevant Notes, whether the placement of the Notes is underwritten or sold on an agency basis only,
the price at which such Notes will be purchased by the Dealers and the commissions or other agreed
deductibles (if any) which are payable or allowable by the Issuer in respect of such purchase and the form
of any indemnity to the Dealers against certain liabilities in connection with the offer and sale of the
relevant Notes. The Notes may be resold at prevailing market prices, or at prices related thereto, at the
time of such resale, as determined by the relevant Dealer. The Dealer Agreement also provides for Notes
to be issued in syndicated Series that may be jointly and severally underwritten by two or more Dealers.
Each of the Issuer and Sberbank has agreed to indemnify the Dealers against certain losses, as set out in
the Dealer Agreement. The Dealer Agreement entitles the Dealers to terminate any agreement that they
make to subscribe for the Notes in certain circumstances prior to payment for such Notes being made to
the Issuer.

Selling Restrictions

United States
The Notes and the corresponding Loans have not been and will not be registered under the Securities Act,
the securities laws of any State or other jurisdiction of the United States, and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons except in certain transactions
exempt from the registration requirements of the Securities Act.
Each Dealer has agreed that, except as permitted by the Dealer Agreement, it will not offer or sell the
Notes (i) as part of their distribution at any time or (ii) otherwise until after completion of the distribution
compliance period, within the United States or to, or for the account or benefit of, U.S. persons, and it
will have sent to each dealer to which it sells Notes (other than a sale pursuant to Rule 144A) during the
distribution compliance period a confirmation or other notice setting forth the restrictions on offers and
sales of the Notes within the United States or to, or for the account or benefit of, U.S. persons.
In addition, until 40 days after the commencement of the offering of the Notes, an offer or sale of Notes
within the United States by a dealer that is not participating in the offering may violate the registration
requirements of the Securities Act if such offer or sale is made otherwise than in accordance with Rule
144A.
Terms used in this paragraph have the meanings given to them by Regulation S under the Securities Act.
Notes offered and sold outside the United States to non-U.S. persons may be sold in reliance on
Regulation S. The Dealer Agreement provides that the Dealer(s) may directly or through their respective
U.S. broker-dealer affiliates arrange for the offer and resale of Notes within the United States only to
persons whom they reasonably believe are QIBs and QPs who can represent that (a) they are QPs who
are QIBs within the meaning of Rule 144A, (b) they are not broker-dealers who own and invest on a
discretionary basis less than U.S.$25 million in securities of unaffiliated issuers, (c) they are not a
participant-directed employee plan, such as 401(k) plan, (d) they are acting for their own account, or the
account of one or more QIBs each of which is a QP, (e) they are not formed for the purpose of investing
in the Issuer or the Notes, (f) each account for which they are purchasing will hold and transfer at least
U.S.$100,000 in principal amount of Notes at any time, and (g) they will provide notice of the transfer
restrictions set forth in this Base Prospectus to any subsequent transferees.
This Base Prospectus has been prepared by the Issuer and Sberbank for use in connection with the offer
and sale of the Notes outside the United States and the resale of the Notes in the United States and for
the listing of Notes on the London Stock Exchange, or other stock exchange specified in the Final Terms.
The Issuer and the Dealers reserve the right to reject any offer to purchase the Notes, in whole or in part,
for any reason. This Base Prospectus does not constitute an offer to any person in the United States or
to any U.S. person other than any QIB who is also a QP and to whom an offer has been made directly

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by one of the Dealers or its U.S. broker-dealer affiliate. Distribution of this Base Prospectus by any
non-U.S. person outside the United States or by any QIB/QP within the United States to any U.S. person
or to any other person within the United States, other than any QIB/QP and those persons, if any,
retained to advise such non-U.S. person or QIB/QP with respect thereto, is unauthorised and any
disclosure without the prior written consent of the Issuer of any of its contents to any such U.S. person
or other person within the United States, other than any QIB/QP and those persons, if any, retained to
advise such non-U.S. person or QIB/QP, is prohibited.

United Kingdom
Each Dealer has represented and agreed, and each further Dealer appointed under the Programme will
be required to represent and agree, that:
(a) in relation to any Notes which have a maturity of less than one year, (i) it is a person whose ordinary
    activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent)
    for the purposes of its business and (ii) it has not offered or sold and will not offer or sell any Notes
    other than to persons whose ordinary activities involve them in acquiring, holding, managing or
    disposing of investments (as principal or as agent) for the purposes of their businesses or who it is
    reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for
    the purposes of their businesses where the issue of the Notes would otherwise constitute a
    contravention of Section 19 of the FSMA by the Issuer;
(b) it has only communicated or caused to be communicated and will only communicate or cause to be
    communicated an invitation or inducement to engage in investment activity (within the meaning of
    Section 21 of the FSMA) received by it in connection with the issue or sale of any Notes in
    circumstances in which Section 21(1) of the FSMA does not apply to the Issuer; and
(c) it has complied and will comply with all applicable provisions of the FSMA with respect to anything
    done by it in relation to any Notes in, from or otherwise involving the United Kingdom.

Russian Federation
Under Russian law, the Notes are securities of a foreign issuer. The Notes are not eligible for initial
offering and public circulation in the Russian Federation. Neither the issue of the Notes nor a securities
prospectus in respect of the Notes has been, or is intended to be, registered with the Federal Service for
Financial Markets of the Russian Federation. The information provided in this Base Prospectus is not an
offer, or invitation to make offers, to sell, exchange or otherwise transfer the Notes in the Russian
Federation or to or for the benefit of any Russian person or entity.

Republic of Italy
The offering of any Notes has not been registered with the Commissione Nazionale per la Società de la
Borsa (‘‘CONSOB’’) (the Italian securities and exchange commission) pursuant to the Italian securities
legislation and, accordingly no Notes can be offered, sold or distributed nor any copies of this Base
Prospectus or any other document relating to any Notes can be distributed in the Republic of Italy
(‘‘Italy’’) in a solicitation to the public at large (sollecitazione all’investimento) within the meaning of
Article 1, paragraph 1, letter (t) of Legislative Decree no. 58 of 24 February 1998, unless an exemption
applies. Accordingly, any Notes in Italy:
(a) shall only be offered or sold to professional investors (operatori qualificati), as defined in Article 31,
    second paragraph of CONSOB Regulation No 11522 of 1 July 1998 (the ‘‘Regulation No 11522’’), as
    amended, and effected in compliance with the terms and procedures provided therein; or
(b) shall only be offered or sold in circumstances which are exempted from the rules of solicitation of
    investments pursuant to Article 100 of Legislative Decree No 58 of 24 February 1998 (the ‘‘Financial
    Services Act’’) and Article 33, first paragraph, of CONSOB Regulation No 11971 of 14 May 1999;
(c) but, in any case, cannot be offered, sold and/or delivered, either in the primary or in the secondary
    market, to individuals in Italy, and in any event, the offer or sale of any Notes in Italy shall be effected
    in accordance with all relevant Italian securities, tax and exchange control and other applicable laws
    and regulations.
Moreover and subject to the foregoing, no Notes may be offered, sold or delivered and neither this Base
Prospectus nor any other material relating to any Notes may be distributed or made available in Italy

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unless such offer, sale or delivery of any Notes or distribution or availability of copies of this Base
Prospectus or any other material relating to the Notes in Italy is:
(d) made by investment firms, banks or financial intermediaries permitted to conduct such activities in
    Italy in accordance with the Financial Services Act, Legislative Decree No 385 of 1 September 1993
    (the ‘‘Italian Banking Act’’), the Regulation No 11522 and any other applicable laws and regulations;
(e) in compliance with Article 129 of the Italian Banking Act and the implementing instructions of the
    Bank of Italy, pursuant to which the issue, trading or placement of securities (e.g., Notes) in Italy is
    subject to prior and subsequent notification to the Bank of Italy, unless an exemption, depending,
    inter alia, on the amount of the issue and the characteristics of the securities, applies; and
(f) in compliance with any other applicable requirement or limitation which may be imposed from time
    to time by CONSOB or the Bank of Italy.
Insofar as the requirements above are based on laws which are superseded at any time pursuant to the
implementation of the Prospectus Directive, such requirements shall be replaced by the applicable
requirements under the Prospectus Directive.
The Netherlands
Each Dealer has represented to and agreed with the Issuer, Sberbank and each other Dealer that the
Notes may not, directly or indirectly, be offered, sold, pledged, transferred or delivered, whether at their
initial distribution or at any time thereafter, and neither this Base Prospectus nor any other document in
respect of the offering may be distributed or circulated, in the Netherlands other than to professional
market parties within the meaning of the Exemption Regulation pursuant to the Netherlands Banking
Act (Vrijstellingsregeling Wtk 1992) (which includes, inter alia, banks, insurance companies, securities
firms, collective investment undertakings and pension funds supervised in the Netherlands or exempted
from supervision on the basis of Dutch legislation), provided that these parties acquire the Notes for their
own account. Each person or legal entity resident, domiciled or established in the Netherlands, by
purchasing one or more Notes (or any interest therein), will be deemed to have represented and agreed
for the benefit of the Issuer as set forth in the following legend (which shall be placed on each Note,
whether or not offered to Dutch residents):
‘‘ANY PERSON WHO HOLDS (A BENEFICIAL INTEREST IN) THIS OBLIGATION, WHO IS
RESIDENT IN THE NETHERLANDS, SHALL BE DEEMED TO HAVE REPRESENTED AND
AGREED THAT IT IS A PROFESSIONAL MARKET PARTY, AND IS ACQUIRING THIS NOTE
(OR ANY INTEREST THEREIN) FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
PROFESSIONAL MARKET PARTY, AS DEFINED IN SECTION 1 SUB E OF THE EXEMPTION
REGULATION PURSUANT TO THE NETHERLANDS BANKING ACT, AND IS FURTHER
REPRESENTING AND AGREEING THAT (I) IT MAY NOT OFFER, SELL, PLEDGE, TRANSFER
OR DELIVER (A BENEFICIAL INTEREST IN) THIS OBLIGATION TO ANY RESIDENT OF
THE NETHERLANDS WHO IS NOT SUCH A PROFESSIONAL MARKET PARTY AND (II) IT
WILL PROVIDE NOTICE OF THIS RESTRICTION TO ANY SUBSEQUENT TRANSFEREE.’’
General
Each Dealer has agreed that it has, to the best of its knowledge and belief, complied and will comply with
applicable laws and regulations in each jurisdiction in which they offer, sell or deliver Notes or distribute
this Base Prospectus (and any amendments thereof and supplements thereto) or any other offering or
publicity material relating to the Notes, the Issuer or Sberbank.
No action has or will be taken in any jurisdiction by the Issuer, Sberbank or any of the Dealers that would,
or is intended to, permit a public offer of the Notes or possession or distribution of any offering material
in relation thereto, in any country or jurisdiction where action for that purpose is required. Accordingly,
each Dealer has undertaken to the Issuer and Sberbank that it will not, directly or indirectly, offer or sell
any Notes or distribute or publish any prospectus, form of application, advertisement or other document
or information in any country or jurisdiction except under circumstances that will, to the best of its
knowledge and belief, result in compliance with any applicable laws and regulations and all offers and
sales of Notes by it will be made on the same terms.
These selling restrictions may be modified by the agreement of the Issuer, Sberbank and the Dealers
following a change in a relevant law, regulation or directive. Any such modification will be set out in the
Final Terms issued in respect of the issue of Notes to which it relates or in a supplement to this Base
Prospectus.

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The Arrangers, the Dealers and their respective affiliates have engaged in transactions with Sberbank and
its subsidiaries (including, in some cases, credit agreements and credit lines) in the ordinary course of their
banking business and the Arrangers and the Dealers performed various investment banking, financial
advisory, and other services for Sberbank, for which they received customary fees, and the Arrangers, the
Dealers and their respective affiliates may provide such services in the future.




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                                               TAXATION
The following is a general description of certain tax laws relating to the Notes and does not purport to be
a comprehensive discussion of the tax treatment of all tax considerations relating to every Series of Notes.
Prospective purchasers of any Series of Notes are advised to consult their own tax advisors as to the
consequences of the purchase, ownership and disposition of any Series of Notes in light of their particular
circumstances, including, but not limited to, the consequences of the receipt of interest and the sale or
redemption of any Series of Notes.

Russian Federation

General
The following is a summary of certain Russian tax considerations relevant to the purchase, ownership and
disposition of any Series of Notes, as well as taxation of interest payments on any corresponding Loan.
The summary is based on the laws of Russia in effect on the date of this Base Prospectus. The summary
does not seek to address the applicability of, and procedures in relation to, taxes levied by regions,
municipalities or other non-federal level authorities of Russia, nor does the summary seek to address the
availability of double tax treaty relief in respect of any Series of Notes, or practical difficulties involved
in claiming such double tax treaty relief.
Prospective investors should consult their own tax advisors regarding the tax consequences of investing
in the Notes in their own particular circumstances. No representation with respect to the Russian tax
consequences to any particular Noteholder is made hereby.
Many aspects of Russian tax law are subject to significant uncertainty. Furthermore, the substantive
provisions of Russian tax law applicable to financial instruments may be subject to more rapid and
unpredictable change and inconsistency than in jurisdictions with more developed capital markets and tax
systems. For the purposes of this summary, a ‘‘non-resident Noteholder’’ means:
•   an individual Noteholder present in Russia for an aggregate period of less than 183 days (excluding
    days of arrival into Russia but including days of departure from Russia) in a given calendar year; or
•   a legal entity or organisation in each case not organised under Russian law which holds and disposes
    of the Notes otherwise than through a permanent establishment in Russia.
A resident Noteholder means any person (including any individual and any legal entity) not qualifying as
a non-resident Noteholder.
The Russian tax treatment of interest payments made by Sberbank to the Issuer or to the Trustee under
each Loan Agreement may affect the holders of the Notes. See ‘‘—Taxation of Interest on the Loan’’
below.

Taxation of the Notes

Non-Resident Noteholders
A non-resident Noteholder should not be subject to any Russian taxes in respect of payments of interest
and principal on the Notes received from the Issuer.
A non-resident Noteholder also generally should not be subject to any Russian taxes in respect of any gain
or other income realised on redemption, sale or other disposition of the Notes outside Russia, provided
that the proceeds of such disposition are not received from a source within Russia.
In the event that proceeds from a disposition of Notes are received from a source within Russia, a
non-resident Noteholder that is a legal entity or organisation should not be subject to Russian tax on any
gain on sale or other disposition of the Notes, although there is some residual uncertainty regarding the
treatment of the portion of the proceeds, if any, from disposition of the Notes that is attributable to
accrued interest on the Notes. Subject to reduction or elimination under provisions of an applicable
double tax treaty that are related to interest income, proceeds attributable to accrued interest may be
taxed at a rate of 20%, even if the disposal results in a capital loss.
Subject to any available tax treaty relief, the receipt of proceeds by a non-resident individual from a
source within Russia in respect of the gain from a disposition of the Notes is likely to be treated as
Russian-source income for personal income tax purposes and, as such, will be subject to Russian personal


                                                    178
income tax at a rate of 30% on the gross proceeds received less any available cost deduction (including
the original purchase price). In certain circumstances if the disposal proceeds are paid by a Russian legal
entity or organisation, or by an individual entrepreneur located in Russia, the personal income tax at the
rate of 30% may be withheld at source. If this tax is not withheld at source, then the non-resident
individual may be liable to pay the tax. There is some uncertainty regarding the treatment of the portion
of the proceeds, if any, from a disposition of the Notes that is attributable to accrued interest on the Notes.
Subject to reduction or elimination under provisions of an applicable tax treaty that are related to interest
income, proceeds attributable to accrued interest may be taxed at a rate of 30%, even if the disposal
results in a capital loss.
There is also a risk that any gain may be affected by changes in the exchange rate between the currency
of acquisition of the Notes, the currency of disposition and roubles.

Tax Treaty Relief
The Russian Federation has concluded double tax treaties with a number of countries and honours some
double tax treaties concluded by the former Union of Soviet Socialist Republics. These tax treaties may
contain provisions that reduce or eliminate Russian tax due with respect to income received from a source
within Russia by a non-resident Noteholder on a disposition of Notes. To obtain the benefit of such tax
treaty provisions, the Noteholder must comply with the certification, information, and reporting
requirements in force in Russia. Currently, a Noteholder would need to provide the payer of income with
a certificate of tax residence issued by the competent tax authority of the relevant treaty country. In
addition, an individual must provide appropriate documentary proof of income received and the tax
payment made outside Russia on income with respect to which treaty benefits are claimed. Because of
uncertainties regarding the form and procedures for providing such documentary proof, individuals in
practice may not be able to obtain advance treaty relief on receipt of proceeds from a source within
Russia, whilst obtaining a refund of the taxes withheld can be extremely difficult, if not impossible.
Non-resident Noteholders should consult their own tax advisors regarding possible tax treaty relief and
procedures for obtaining such relief with respect to any Russian taxes imposed in respect of proceeds
received on a disposition of Notes.

Resident Noteholders
A resident Noteholder will be subject to all applicable Russian taxes in respect of gains from disposition
of the Notes and interest received on the Notes.

Taxation of Interest on the Loan
In general, payments of interest on borrowed funds by a Russian entity to a non-resident legal entity are
subject to Russian withholding tax at the rate of 20%, absent reduction or elimination pursuant to the
terms of an applicable double tax treaty. Based on professional advice it has received, Sberbank believes
that payments of interest to the Issuer on each Loan should not be subject to withholding tax under the
terms of the double tax treaty between Russia and Luxembourg. However, there can be no assurance that
such relief will be available.
If interest under the Loan becomes payable to the Trustee pursuant to the Trust Deed, any benefit of the
double tax treaty between Russia and Luxembourg will cease and payments of interest may be subject to
Russian withholding tax at the rate of 20%. In such cases, Noteholders may seek reduction of withholding
tax under double taxation treaties entered into between their countries of residence and Russia, where
such treaties exist and to the extent they are applicable.
For treaty relief from Russian withholding tax, preliminary approval from the Russian tax authorities is
neither required nor possible. However, the Russian tax authorities may subsequently scrutinise the
Issuer’s eligibility for treaty relief during tax audits.
If payments under any Loan are subject to any withholding of Russian tax (as a result of which the Issuer
would reduce payments under the corresponding Series of Notes in the amount of such withholding),
Sberbank is obliged (subject to certain conditions) to increase payments as may be necessary so that the
net payments received by the Noteholders will be equal to the amounts they would have received in the
absence of such withholding. It should be noted, however, that the tax gross-up provisions may not be
enforceable under Russian law. In the event that Sberbank fails to make increased payments, such failure
would constitute an Event of Default pursuant to the Loan Agreement. If Sberbank is obliged to increase

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payments, it may (without premium or penalty), subject to certain conditions, prepay such Loan in full.
In such case, all outstanding Notes of the corresponding Series and the corresponding Deposit would each
be redeemable at the principal amount outstanding on the relevant Notes together with accrued and
unpaid interest and additional amounts, if any, to the date of redemption.
No value added tax will be payable in Russia in respect of interest and principal payments under each
Loan.

EU Savings Directive on the Taxation of Savings Income in the Form of Interest Payments (Directive
2003/48/EC)
Under European Council Directive 2003/48/EC on the taxation of savings income (the ‘‘Savings
Directive’’), each member state of the European Union (a ‘‘Member State’’) generally must provide to the
tax authorities of another Member State details of interest payments or similar income paid by a paying
agent within its jurisdiction to an individual resident, or other residual entity (as described in the Savings
Directive) established, in the latter Member State. However, for a transitional period, Austria, Belgium
and Luxembourg are entitled to provide for a withholding tax system. The transitional period will
terminate at the end of the first full fiscal year after the European Union and certain non-European Union
states reach agreement relating to information exchange.
Under certain bilateral agreements, a number of non-European Union countries and dependant and
associated territories have adopted similar measures (some of which involve a withholding system). Under
principles of reciprocity, paying agents within European Union Member States will also apply similar
measures in respect of payments made to residents of the relevant dependant and associated territories.
Noteholders should consult their own tax advisers regarding the implications of the Savings Directive in
their particular circumstances.

Luxembourg
The following general summary is based upon the tax laws of Luxembourg as in effect on the date of this
Base Prospectus and is subject to any change that may come into effect after that date. Under the existing
laws of Luxembourg:

Withholding Tax
Under Luxembourg tax law currently in effect and with the possible exception of interest paid to
individual Noteholders, there is no Luxembourg withholding tax on payments of interest (including
accrued but unpaid interest). There is also no Luxembourg withholding tax, with the possible exception
of payments made to individual Noteholders, upon repayment of principal in case of reimbursement,
redemption, repurchase or exchange of the Notes.

Luxembourg Non-Resident Individuals
Under the Luxembourg laws dated June 21, 2005 implementing the Savings Directive and several
agreements concluded between Luxembourg and certain dependent territories of the European Union, a
Luxembourg based paying agent (within the meaning of the Savings Directive) is required since
July 1, 2005 to withhold tax on interest and other similar income paid by it to (or under certain
circumstances, to the benefit of) an individual resident in another Member State, unless the beneficiary
of the interest payments opts for the procedure of exchange of information or for the tax certificate
procedure. The same regime applies to payments to individuals resident in certain EU dependent
territories.
The withholding tax rate is initially 15%, increasing steadily to 20% and to 35%. The withholding tax
system will only apply during a transitional period, the ending of which depends on the conclusion of
certain agreements relating to information exchange with certain third countries.

Luxembourg Resident Individuals
A 10% withholding tax has been introduced, as from January 1, 2006, on interest payments made by
Luxembourg paying agents (defined in the same way as in the Savings Directive) to Luxembourg
individual residents. Only interest accrued after July 1, 2005 falls within the scope of the withholding tax.
This withholding tax represents the final tax liability for the Luxembourg individual resident taxpayers.


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Taxation of Luxembourg Non-residents
Noteholders who are not residents of Luxembourg and who have neither a permanent establishment nor
a fixed base of business in Luxembourg with which the holding of the Notes is connected are not liable
to any Luxembourg income tax, whether they receive payments of principal, payments of interest
(including accrued but unpaid interest), payments received upon the redemption of the Notes, or realise
capital gains on the sale or the exchange of any Notes.

Taxation of Luxembourg Residents—General

Luxembourg Resident Individuals
The 10% Luxembourg withholding tax (see ‘‘—Withholding Tax—Luxembourg Resident Individuals’’)
represents, however, the final tax liability on interest received for the Luxembourg resident individuals.
Luxembourg resident individual Noteholders are not subject to taxation on capital gains upon the disposal
of the Notes, unless the disposal of the Notes precedes the acquisition of the Notes or the Notes are
disposed of within six months of the date of acquisition of these Notes. Upon redemption or exchange of
the Notes, individual Luxembourg resident Noteholders must however include the portion of the
redemption or exchange price corresponding to accrued but unpaid interest in their taxable income.

Luxembourg Resident Companies
Corporate Noteholders who are residents of Luxembourg, or non-resident Noteholders who have a
permanent establishment in Luxembourg with which the holding of the Notes is connected, must, for
income tax purposes, include any interest received - or accrued - in their taxable income. They will not
be liable to any Luxembourg income tax on repayment of principal.
Luxembourg resident companies (sociétés de capitaux) Noteholders or foreign entities of the same type
which have a permanent establishment in Luxembourg with which the holding of the Notes is connected,
must include in their taxable income the difference between the sale or redemption price (including
accrued but unpaid interest) and the lower of the cost or book value of the Notes sold or redeemed.

Luxembourg Resident Companies Benefiting From a Special Tax Regime
Noteholders who are holding companies subject to the law of July 31, 1929 and which do not fall into the
scope of the law of June 21, 2005 or undertakings for collective investment subject to the law of March
30, 1988 or the law of December 20, 2002 are tax exempt entities in Luxembourg, and are thus not subject
to any Luxembourg tax (i.e. corporate income tax, municipal business tax and net wealth tax) other than
the subscription tax calculated on their share capital or net asset value.

Other Taxes

Luxembourg net wealth tax will not be levied on a Noteholder unless:
•   the Noteholder is, or is deemed to be, a company resident in Luxembourg for the purpose of the
    relevant provisions; or
•   such Note is attributable to an enterprise or part thereof that is carried on through a permanent
    establishment in Luxembourg.
Luxembourg inheritance taxes will only be levied on the transfer of a Note on the death of the
Noteholder if the Noteholder is inhabitant in Luxembourg. Under Article 1 of the Inheritance Tax Law
dated December 27, 1817, an inhabitant of Luxembourg is a person whose domicile or seat of wealth is
located in Luxembourg.
Luxembourg gift tax will be levied on the transfer of a Note by way of gift by the Noteholder if this gift
is registered in Luxembourg.
There is no Luxembourg registration tax, capital tax, stamp duty or any other similar tax or duty (other
than nominal court fees and contributions for the registration with the Chamber of Commerce) payable
in Luxembourg in respect of or in connection with the execution, delivery and enforcement by legal
proceedings (including any foreign judgment in the courts of Luxembourg) of the Notes or the
performance of the Issuer’s obligations under the Notes, except that in the case of court proceedings in


                                                   181
a Luxembourg court or the presentation of the documents relating to the Notes, other than the Notes, to
an ‘‘autorité constituée,’’ such court or ‘‘autorité constituée’’ may require registration thereof, in which case
the documents will be subject to registration duties depending on the nature of the documents and, in
particular, a loan agreement, not represented by the Notes, will be subject to an ad valorem registration
duty of 0.24% calculated on the amounts mentioned therein.
There is no Luxembourg value added tax payable in respect of payments in consideration for the issue of
the Notes or in respect of the payment of interest or principal under the Notes or the transfer of a Note,
provided that Luxembourg value added tax may, however, be payable in respect of fees charged for
certain services rendered to the Issuer, if for Luxembourg value added tax purposes such services are
rendered, or are deemed to be rendered, in Luxembourg and an exemption from value added tax does
not apply with respect to such services.
A Noteholder will not become resident, or deemed to be resident, in Luxembourg by reason only of the
holding of a Note or the execution, performance, delivery and/or enforcement of the Note.




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                                     TRANSFER RESTRICTIONS
Because of the following restrictions, you are advised to consult legal counsel prior to making any offer,
resale or other transfer offered hereby.
Rule 144A Notes
Each purchaser of Rule 144A Notes, by accepting delivery of this Base Prospectus and the Notes, will be
deemed to have represented, agreed and acknowledged that:
(1) If it is a U.S. Person within the meaning of Regulation S, it is (a) a QIB that is also a QP, (b) not a
    broker-dealer which owns and invests on a discretionary basis less than U.S.$25 million in securities
    of unaffiliated issuers, (c) not a participant-directed employee plan, such as a 401(k) plan,
    (d) acquiring such Notes for its own account, or for the account of one or more QIBs each of which
    is also a QP, (e) not formed for the purpose of investing in the Notes or the Issuer, and (f) aware, and
    each beneficial owner of such Notes has been advised, that the seller of such Notes may be relying
    on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A.
(2) It will, (a) along with each account for which it is purchasing, hold and transfer beneficial interests
    in the Rule 144A Notes in a principal amount that is not less than U.S.$100,000 and (b) provide notice
    of these transfer restrictions to any subsequent transferees. In addition, it understands that the Issuer
    may receive a list of participants holding positions in the Issuer’s securities from one or more
    book-entry depositories.
(3) It understands that the Rule 144A Notes have not been and will not be registered under the
    Securities Act and may not be offered, sold, pledged or otherwise transferred except (a) in
    accordance with Rule 144A to a person that it and any person acting on its behalf reasonably believe
    is a QIB that is also a QP purchasing for its own account or for the account of one or more QIBs,
    each of which is also a QP or (b) to a non-U.S. person within the meaning of Regulation S in an
    offshore transaction in accordance with Rule 903 or Rule 904 of Regulation S under the Securities
    Act, in each case in accordance with any applicable securities laws of any State or another jurisdiction
    of the United States.
(4) It understands that the Issuer has the power to compel any beneficial owner of Rule 144A Notes that
    is a U.S. person and is not a QIB and a QP to sell its interest in the Rule l44A Notes, or may sell such
    interest on behalf of such owner. The Issuer has the right to refuse to honour the transfer of an
    interest in the Rule 144A Notes to a U.S. person who is not a QIB and a QP.
(5) It understands and acknowledges that its purchase and holding of such Notes constitutes a
    representation and agreement by it that, at the time of its purchase and throughout the period in
    which it holds such Notes or any interest therein, (a) it is not an employee benefit plan as described
    in Section 3(3) of the United States Employee Retirement Income Security Act of 1974, as amended
    (‘‘ERISA’’), whether or not subject to the provisions of Title I of ERISA, a plan described in Section
    4975(e)(1) of the Code, or an entity whose underlying assets include plan assets by reason of a plan’s
    investment in the entity, and (b) it will not sell or otherwise transfer any such Note or interest to any
    person without first obtaining the same foregoing representations and warranties from that person.
(6) It understands that the Rule 144A Global Note and any Definitive Notes issued in respect thereof,
    unless otherwise agreed between the Issuer and the Trustee in accordance with applicable law, will
    bear a legend to the following effect:
    THIS NOTE AND THE LOAN IN RESPECT THEREOF HAVE NOT BEEN AND WILL NOT
    BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE ‘‘SECURITIES ACT’’)
    OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER
    JURISDICTION OF THE UNITED STATES, AND THIS NOTE MAY NOT BE OFFERED,
    SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) IN ACCORDANCE
    WITH RULE 144A UNDER THE SECURITIES ACT (‘‘RULE 144A’’) TO A PERSON THAT
    THE HOLDER AND ANY PERSON ACTING ON ITS BEHALF REASONABLY BELIEVES
    IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE l44A
    (A ‘‘QIB’’) THAT IS A QUALIFIED PURCHASER (‘‘QP’’) WITHIN THE MEANING OF
    SECTION 2(a)(51) OF THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED
    (THE ‘‘INVESTMENT COMPANY ACT’’), PURCHASING FOR ITS OWN ACCOUNT OR
    FOR THE ACCOUNT OF ONE OR MORE QIBS, EACH OF WHICH IS A QP WHOM THE
    HOLDER HAS INFORMED, IN EACH CASE, THAT SUCH OFFER, SALE, PLEDGE OR

                                                    183
    OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE
    SECURITIES ACT, AND IN AN AMOUNT FOR EACH ACCOUNT OF NOT LESS THAN
    U.S.$100,000 PRINCIPAL AMOUNT OF NOTES OR (2) IN AN OFFSHORE TRANSACTION
    TO A PERSON WHO IS NOT A U.S. PERSON WITHIN THE MEANING OF REGULATION
    S UNDER THE SECURITIES ACT (‘‘REGULATION S’’) IN ACCORDANCE WITH RULE
    903 OR RULE 904 OF REGULATION S, AND, IN EACH CASE IN ACCORDANCE WITH
    ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE
    HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
    PURCHASER FROM IT OF THE NOTES IN RESPECT HEREOF OF THE RESALE
    RESTRICTIONS REFERRED TO ABOVE. TRANSFER IN VIOLATION OF THE
    FOREGOING WILL BE OF NO FORCE OR EFFECT, WILL BE VOID AB INITIO, AND
    WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE,
    NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE ISSUER OF
    THIS NOTE, THE TRUSTEE OR ANY INTERMEDIARY. NO REPRESENTATION CAN BE
    MADE AS TO THE AVAILABILITY OF ANY EXEMPTION UNDER THE SECURITIES
    ACT FOR RESALES OF THIS NOTE.
    IF THE BENEFICIAL OWNER HEREOF IS A U.S. PERSON WITHIN THE MEANING OF
    REGULATION S, SUCH BENEFICIAL OWNER REPRESENTS THAT (1) IT IS A QIB THAT
    IS ALSO A QP; (2) IT IS NOT A BROKER-DEALER WHICH OWNS AND INVESTS ON A
    DISCRETIONARY BASIS LESS THAN U.S.$25,000,000 IN SECURITIES OF UNAFFILIATED
    ISSUERS; (3) IT IS NOT A PARTICIPANT-DIRECTED EMPLOYEE PLAN, SUCH AS A
    401(k) PLAN; (4) IT IS HOLDING THIS NOTE FOR ITS OWN ACCOUNT OR FOR THE
    ACCOUNT OF ONE OR MORE QIBS, EACH OF WHICH IS A QP; (5) IT WAS NOT
    FORMED FOR THE PURPOSE OF INVESTING IN THE ISSUER OR THIS NOTE; (6) IT
    UNDERSTANDS THAT THE ISSUER MAY RECEIVE A LIST OF PARTICIPANTS HOLDING
    POSITIONS IN ITS SECURITIES FROM ONE OR MORE BOOK-ENTRY DEPOSITARIES
    AND (7) IT WILL PROVIDE NOTICE OF THE FOREGOING TRANSFER RESTRICTIONS
    TO ITS SUBSEQUENT TRANSFEREES.
    THE BENEFICIAL OWNER HEREOF HEREBY ACKNOWLEDGES THAT IF AT ANY
    TIME WHILE IT HOLDS AN INTEREST IN THIS NOTE IT IS A U.S. PERSON WITHIN THE
    MEANING OF REGULATION S THAT IS NOT A QIB AND A QP, THE ISSUER MAY
    (A) COMPEL IT TO SELL ITS INTEREST IN THIS NOTE TO A PERSON WHO IS (I) A U.S.
    PERSON WHO IS A QIB AND A QP THAT IS, IN EACH CASE, OTHERWISE QUALIFIED
    TO PURCHASE THIS NOTE IN A TRANSACTION EXEMPT FROM REGISTRATION
    UNDER THE SECURITIES ACT OR (II) NOT A U.S. PERSON WITHIN THE MEANING OF
    REGULATION S OR (B) COMPEL THE BENEFICIAL OWNER TO SELL ITS INTEREST IN
    THIS NOTE TO THE ISSUER OR AN AFFILIATE OF THE ISSUER OR TRANSFER ITS
    INTEREST IN THIS NOTE TO A PERSON DESIGNATED BY OR ACCEPTABLE TO THE
    ISSUER AT A PRICE EQUAL TO THE LESSER OF (X) THE PURCHASE PRICE THEREOF
    PAID BY THE BENEFICIAL OWNER, (Y) 100% OF THE PRINCIPAL AMOUNT THEREOF
    OR (Z) THE FAIR MARKET VALUE THEREOF. THE ISSUER HAS THE RIGHT TO
    REFUSE TO HONOUR A TRANSFER OF AN INTEREST IN THIS NOTE TO A U.S.
    PERSON WHO IS NOT A QIB AND A QP. THE ISSUER HAS NOT BEEN AND WILL NOT
    BE REGISTERED UNDER THE INVESTMENT COMPANY ACT.
    EACH BENEFICIAL OWNER HEREOF REPRESENTS AND WARRANTS THAT FOR SO
    LONG AS IT HOLDS THIS NOTE OR ANY INTEREST HEREIN (1) IT IS NOT AND WILL
    NOT BE A BENEFIT PLAN INVESTOR (AS DEFINED IN 29 CFR SECTION 2510.3-101) AND
    (2) IT WILL NOT SELL OR OTHERWISE TRANSFER ANY NOTE OR INTEREST THEREIN
    TO ANY PERSON WITHOUT FIRST OBTAINING THE SAME FOREGOING
    REPRESENTATIONS, WARRANTIES AND COVENANTS FROM THAT PERSON.
    THE ISSUER MAY COMPEL EACH BENEFICIAL OWNER OF THIS NOTE THAT IS A U.S.
    PERSON WITHIN THE MEANING OF REGULATION S TO CERTIFY PERIODICALLY
    THAT SUCH BENEFICIAL OWNER IS A QIB AND A QP.
(7) It acknowledges that the Issuer, Sberbank, the Registrar, the Dealers and their affiliates, and others
    will rely upon the truth and accuracy of the above acknowledgements, representations and
    agreements and agrees that, if any of the acknowledgements, representations or agreements deemed
    to have been made by it by its purchase of Rule 144A Notes is no longer accurate, it shall promptly

                                                  184
    notify the Issuer, Sberbank and the Dealers. If it is acquiring any Notes as a fiduciary or agent for one
    or more investor accounts, it represents that it has sole investment discretion with respect to each
    such account and that it has full power to make the above acknowledgements, representations and
    agreements on behalf of each account.
(8) It understands that Rule l44A Notes of a Series will be evidenced by a Rule 144A Global Note.
    Before any interest in a Rule l44A Global Note may be offered, sold, pledged or otherwise
    transferred to a person who takes delivery in the form of an interest in a Regulation S Global Note,
    it will be required to provide a Transfer Agent with a written certification (in the form provided in
    the Agency Agreement) as to compliance with applicable securities laws.

Prospective purchasers are hereby notified that sellers of the Notes may be relying on the exemption from
the provisions of Section 5 of the Securities Act provided by Rule 144A.

Regulation S Notes
Each purchaser of Regulation S Notes outside the United States, by accepting delivery of this Base
Prospectus and the Regulation S Notes, will be deemed to have represented, agreed and acknowledged
that:
(1) It is, or at the time Regulation S Notes are purchased will be, the beneficial owner of such Regulation
    S Notes and (a) it is not a U.S. person and it is located outside the United States (within the meaning
    of Regulation S), and (b) it is not an affiliate of the Issuer, Sberbank or a person acting on behalf of
    such an affiliate.
(2) It understands that the Regulation S Notes have not been and will not be registered under the
    Securities Act and, prior to the expiration of the distribution compliance period, it will not offer, sell,
    pledge or otherwise transfer such Notes except (a) in accordance with Rule 144A to a person that it
    and any person acting on its behalf reasonably believes is a QIB that is also a QP purchasing for its
    own account or for the account of a QIB that is also a QP or (b) in an offshore transaction in
    accordance with Rule 903 or Rule 904 of Regulation S, in each case in accordance with any applicable
    securities laws of any State of the United States.
(3) It understands that Regulation S Notes of a Series will be evidenced by a Regulation S Global Note.
    Before any interest in a Regulation S Global Note may be offered, sold, pledged or otherwise
    transferred to a person who takes delivery in the form of an interest in a Rule 144A Global Note, it
    will be required to provide a Transfer Agent with a written certification (in the form provided in the
    Agency Agreement) as to compliance with applicable securities laws.
(4) It understands and acknowledges that its purchase and holding of such Notes constitutes a
    representation and agreement by it that, at the time of its purchase and throughout the period it holds
    such Notes or any interest therein, (a) it is not an employee benefit plan as described in Section 3(3)
    of the United States Employee Retirement Income Security Act of 1974, as amended (‘‘ERISA’’),
    whether or not subject to the provisions of Title I of ERISA, a plan described in Section 4975(e)(1)
    of the Code, or an entity whose underlying assets include plan assets by reason of a plan’s investment
    in the entity, and (b) it will not sell or otherwise transfer any such Note or interest to any person
    without first obtaining these same foregoing representations and warranties from that person.
(5) It acknowledges that the Issuer, Sberbank, the Registrar, the Dealers and their affiliates and others
    will rely upon the truth and accuracy of the above acknowledgements, representations and
    agreements and agree that, if any of the acknowledgements, representations or agreements deemed
    to have been made by it by its purchase of Notes is no longer accurate, it shall promptly notify the
    Issuer, Sberbank, and the Dealers. If it is acquiring any Notes as a fiduciary or agent for one or more
    investor accounts, it represents that it has sole investment discretion with respect to each such
    account and that it has full power to make the above acknowledgements, representations and
    agreements on behalf of each account.




                                                     185
                                      FORM OF FINAL TERMS

The form of Final Terms that will be issued in respect of each Series, subject only to completion and the
deletion of non-applicable provisions, is set out below.

Final Terms dated ●

                                    SB CAPITAL S.A. (the ‘‘Issuer’’)
                                                ´´
                                            societe anonyme
                 registered office: 2, Boulevard Konrad Adenauer, L-1115 Luxembourg
                                       RCS Luxembourg B-115914

           Issue of [Aggregate Principal Amount of Series] [Title of Loan Participation Notes]
    under a U.S.$10,000,000,000 Programme for the Issuance of Loan Participation Notes by the Issuer
                  for the purpose of financing a Loan to SBERBANK (the ‘‘Borrower’’)

                                 PART A—CONTRACTUAL TERMS

Terms used herein shall be deemed to be defined as such for the purposes of the Conditions set forth in
the Base Prospectus dated May 12, 2006 [and the supplemental Base Prospectus dated ●] which
[together] constitute[s] a base prospectus for the purposes of the Prospectus Directive (Directive
2003/71/EC) (the ‘‘Prospectus Directive’’). This document constitutes the Final Terms of the Notes
described herein for the purposes of Article 5.4 of the Prospectus Directive and must be read in
conjunction with such Base Prospectus [as so supplemented]. Full information on the Issuer and the
Borrower and the offer of the Notes is only available on the basis of the combination of these Final Terms
and the Base Prospectus. [The Base Prospectus [and the supplemental Base Prospectus] [is] [are]
available for viewing at [address] [and] [website] and copies may be obtained from [address].]

The following alternative language applies if the first issue of a Series which is being increased was
issued under a Base Prospectus with an earlier date.

Terms used herein shall be deemed to be defined as such for the purposes of the Conditions (the
‘‘Conditions’’) set forth in the Base Prospectus dated [original date] [and the supplemental Base
Prospectus dated ●]. This document constitutes the Final Terms of the Notes described herein for the
purposes of Article 5.4 of the Prospectus Directive (Directive 2003/71/EC) (the ‘‘Prospectus Directive’’)
and must be read in conjunction with the Base Prospectus dated [current date] [and the supplemental
Base Prospectus dated ●], which [together] constitute[s] a base prospectus for the purposes of the
Prospectus Directive, save in respect of the Conditions which are extracted from the Base Prospectus
dated [original date] [and the supplemental Base Prospectus dated ●] and are attached hereto. Full
information on the Issuer and Sberbank and the offer of the Notes is only available on the basis of the
combination of these Final Terms and the Base Prospectuses dated [original date] and [current date] [and
the supplemental Base Prospectuses dated ● and ●]. [The Base Prospectuses [and the supplemental Base
Prospectuses] are available for viewing at [address] [and] [website] and copies may be obtained from
[address].]
1       Issuer:                                          ●
2       Series Number:                                   ●
3       Specified Currency:                               ●
4       Aggregate Nominal Amount of Notes                ●
        admitted to Trading:
5       Issue Price:                                     ●% of the aggregate principal amount of the
                                                         Notes [plus accrued interest from ● (if
                                                         applicable)]
6       Specified Denominations:                          ●
7       (i) Issue Date:                                  ●
        (ii) Interest Commencement Date:                 ●
8       Maturity Date:                                   ●




                                                   186
9    Interest Basis:                                    [●% Fixed Rate] [subject to interest rate step-up
                                                        as specified below (in the case of a Subordinated
                                                        Series)]
                                                        [●+/- ●% Floating Rate] [subject to margin
                                                        step-up as specified below (in the case of a
                                                        Subordinated Series)]
                                                        [(further particulars specified below)]
10   Redemption/Payment Basis:                          Redemption at par
11   Change of Interest or Redemption/Payment           ●
     Basis:
12   (i) Status of the Notes:                           Senior
     (ii) Status of the Loan:                           [Senior/Subordinated]
     [(iii) Date [Board] approval for issuance of       ● [and ● respectively]]
     Notes obtained
13   Method of distribution:                            [Syndicated/Non-syndicated]
14   Financial Centres (Condition 7):                   ●
PROVISIONS RELATING TO INTEREST
PAYABLE UNDER THE NOTES
15  Fixed Rate Note Provisions:                         [Applicable/Not Applicable]
    (i) Rate [(s)] of Interest:                         [●%      per   annum       payable     [annually/
                                                        semi-annually] in arrear (in the case of a Senior
                                                        Series)]
                                                        [DETAILS OF INITIAL INTEREST RATE
                                                        AND INTEREST RATE STEP-UP] (in the case
                                                        of a Subordinated Series)
     (ii)  Interest Payment Date(s):                    ● in each year
     (iii) Fixed Coupon Amount [(s)]:                   ● per ● in principal amount
     (iv)  Broken Amount:                               ●
     (v)   Day Count Fraction (Condition 5):            ●
     (vi)  Determination Date(s) (Condition 5):         ●
     (vii) Other terms relating to the method of        [Not Applicable/●]
           calculating interest for Fixed Rate Notes:
16   Floating Rate Note Provisions:                     [Applicable/Not Applicable]
     (i) Interest Period(s):                            ●
     (ii) Specified Interest Payment Dates:              ●
     (iii) Business Day Convention:                     [Floating Rate Business Day Convention/
                                                        Following Business Day Convention/Modified
                                                        Following Business Day Convention/ Preceding
                                                        Business Day Convention/other
     (iv) Business Centre(s):                           ●
     (v) Manner in which the Rate(s) of Interest        [Screen      Rate       Determination/ISDA
            is/are to be determined:                    Determination/other]
     (vi) Interest Period Date(s):                      [Not Applicable/●]
     (vii) Party responsible for calculating the        ●
            Rate(s) of Interest and Interest
            Amount(s) (if not the Calculation
            Agent):
     (viii) Screen Rate Determination:                  As set out in the attached Loan Supplement
     (ix) ISDA Determination:                           As set out in the attached Loan Supplement
     (x) Margin(s):                                     [[+/-] ●% per annum (in the case of a Senior
                                                        Series)]
                                                        [DETAILS OF INITIAL MARGIN TO BE
                                                        SPECIFIED] (in the case of a Subordinated
                                                        Series)
     (xi) Minimum Rate of Interest:                     ●% per annum
     (xii) Maximum Rate of Interest:                    ●% per annum


                                                 187
      (xiii) Day Count Fraction (Condition 5):         ●
      (xiv) Rate Multiplier:                           ●
      (xv) Fall back provisions, rounding provisions, ●
             denominator and any other terms relating
             to the method of calculating interest on
             Floating Rate Notes and Floating Rate
             Loans, if different from those set out in
             the Conditions:
PROVISIONS RELATING TO REDEMPTION
17  Final Redemption Amount of each Note:                [Principal Amount/other]
18  Early Redemption Amount(s) of each Note              [Principal amount/other]
    payable if the Loan should become repayable
    under the Loan Agreement prior to the
    Maturity Date:
GENERAL PROVISIONS APPLICABLE TO THE NOTES
19  Form of the Notes:                Registered Notes
20  Other final terms:                 [Not Applicable/●]
DISTRIBUTION
21  (i) If syndicated, names of Managers:                [Not   Applicable/●]
    (ii) Stabilising (if any):                           [Not   Applicable/●]
22  If non-syndicated, name of Dealer:                   [Not   Applicable/●]
23  Additional selling restrictions:                     [Not   Applicable/●]
GENERAL
24  Additional steps that may only be taken              [Not Applicable/●]
    following approval by an Extraordinary
    Resolution in accordance with Condition 10:
25  The aggregate principal amount of Notes              [Not Applicable/U.S.$●]
    issued has been translated into U.S. dollars at
    the rate of ●, producing a sum of (for Notes
    not denominated in U.S. dollars):
[LISTING AND ADMISSION TO TRADING APPLICATION
These Final Terms comprise the final terms required to list and have admitted to trading the issue of Notes
described herein pursuant to the U.S.$10,000,000,000 Programme for the Issuance of Loan Participation
Notes of the Issuer for the purpose of financing loans to the Borrower.]
RESPONSIBILITY
The Issuer and the Borrower accept responsibility for the information contained in these Final Terms. [●
has been extracted from ●. Each of the Issuer and the Borrower confirms that such information has been
accurately reproduced and that, so far as it is aware, and is able to ascertain from information published
by ●, no facts have been omitted which would render the reproduced information inaccurate or
misleading.]


Signed on behalf of the Issuer:                          Signed on behalf of the Borrower:



By:                                                      By:
Duly Authorised                                          Duly Authorised



By:                                                      By:
Duly Authorised                                          Duly Authorised



                                                   188
                                  PART B — OTHER INFORMATION

LISTING

    (i)    Listing:                        [London/other/None]

    (ii)   Admission to trading:           [Application has been made for the Notes to be admitted to
                                           trading on ● with effect from ●.] [Not Applicable]

    (iii) Estimate of total expenses
          related to admission to
          trading:                         ●
1   RATINGS

    Ratings:                               The Notes to be issued have been rated:
                                           [S & P: ●]
                                           [Moody’s: ●]
                                           [[Other]: ●]

2   [NOTIFICATION
    The ● [has been requested to provide/has provided] the ● with a certificate of approval attesting
    that the Prospectus has been drawn up in accordance with the Prospectus Directive.]

3   [INTERESTS OF NATURAL AND LEGAL PERSONS INVOLVED IN THE
    [ISSUE/OFFER]
    If applicable, a description of any interest, including conflicting ones, that is material to the
    issue/offer, detailing the persons involved and the nature of the interest is to be included. This may
    be satisfied by the inclusion of the following statement:
    ‘‘Save as discussed in ‘‘Subscription and Sale,’’ so far as the Issuer is aware, no person involved in
    the offer of the Notes has an interest material to the offer.’’]

4   [REASONS FOR THE OFFER, ESTIMATED NET PROCEEDS AND TOTAL EXPENSES

    [(i) Reasons for the offer:            ●

    [(ii)] Estimated net proceeds:         ●

    [(iii)] Estimated total expenses:      ●

5   [Fixed Rate Notes only—YIELD

    Indication of yield:                   [●
                                           The yield is calculated at the Issue Date on the basis of the
                                           Issue Price. It is not an indication of future yield (in the case
                                           of a Senior Series)]
                                           [●
                                           The yield is calculated at the Issue Date on the basis of the
                                           Issue Price and in respect of the Initial Interest Term (as
                                           defined in the Subordinated Loan Agreement). Calculation
                                           of the yield beyond that period is subject to the interest rate
                                           step-up mechanism at the end of such period (in the case of
                                           a Subordinated Series)]




                                                  189
6   OPERATIONAL INFORMATION

    ISIN Code:                           ●

    Common Code:                         ●

    [CUSIP Code                          ●]

    Any clearing system(s) other than
    Euroclear Bank S.A./N.V. [,] [and]
    Clearstream Banking société
    anonyme [and DTC] and the
    relevant identification number(s):    [Not Applicable/●]

    Delivery:                            Delivery [against/free of] payment

    Names and addresses of additional
    Paying Agent(s) (if any):            ●

7   GENERAL

    Tradeable Amount:                    ●
                                         [So long as the Notes are represented by a Global Note, the
                                         Notes will be tradeable only in principal amounts of at least
                                         the Specified Denomination and integral multiples of the
                                         Tradeable Amount in excess thereof]
    [THE FINAL FORM OF EITHER THE LOAN SUPPLEMENT (IN THE CASE OF A SENIOR
    SERIES) OR THE SUBORDINATED LOAN AGREEMENT, INCLUDING THE
    CORRESPONDING SUBORDINATED LOAN SUPPLEMENT (IN THE CASE OF A
    SUBORDINATED SERIES) WILL BE ATTACHED]




                                               190
                                     GENERAL INFORMATION
(1) Sberbank and the Issuer have obtained or will obtain all necessary consents, approvals and
    authorisations in Russia and Luxembourg in connection with any Loan and the issue and
    performance of the corresponding Series of Notes. The establishment of the Programme was
    authorised by the Board of Directors of the Issuer on May 5, 2006. The receipt of Loans from the
    Issuer by Sberbank was authorised by the CIC on April 24, 2006.
(2) The listing of the Notes on the Official List will be expressed as a percentage of their principal
    amount (excluding accrued but unpaid interest). It is expected that the listing of the Programme in
    respect of such Notes on the Official List and the admission of the Notes to trading on the London
    Stock Exchange’s market for listed securities will take place on or about May 16, 2006, subject to the
    issuance of the Global Note in respect of each Series. Prior to such listing and admission, however,
    the London Stock Exchange will permit dealings in each Series of the Notes in accordance with its
    rules. Transactions will normally be effected for delivery on the third business day after the
    transaction. However, Notes may be issued pursuant to the Programme which will not be listed on
    any stock exchange.
(3) No consents, approvals, authorisations or orders of any regulatory authorities are required by the
    Issuer under the laws of Luxembourg for the maintaining of any Loan or for the issue and
    performance of the corresponding Series of Notes.
(4) There has been no significant change in the financial or trading position or prospects of Sberbank
    since December 31, 2005 and no material adverse change in the financial or trading position or
    prospects of Sberbank since December 31, 2005. There has been no significant change and/or
    material adverse change in the financial or trading position or prospects of the Issuer since its
    incorporation on April 21, 2006. The Issuer has no subsidiaries.
(5) Neither Sberbank or any of its subsidiaries is involved in, or has been involved in, any governmental,
    legal or arbitration proceedings that may have had in the twelve months before the date of this Base
    Prospectus, a significant effect on the financial position or profitability of Sberbank, nor, so far as
    Sberbank is aware, are any such proceedings pending or threatened.
(6) The Issuer has not been involved in any governmental, legal or arbitration proceedings that may have
    had, in the twelve months before the date of this Base Prospectus, a significant effect on the Issuer’s
    financial position or profitability, nor, so far as the Issuer is aware, are any such proceedings pending
    or threatened.
(7) For so long as any Series of Notes is outstanding, copies (and English translations where the
    documents in question are not in English) of the following documents may be obtained free of charge
    in physical form at the specified offices of the Trustee and the Paying Agent in London during normal
    business hours on any weekday (Saturdays, Sundays and public holidays excepted):
    •    the audited consolidated financial statements of Sberbank as of and for the years ended
         December 31, 2005 and 2004 and the latest available audited financial statements of Sberbank;
    and copies of the following documents will be available for inspection in physical form at the specified
    offices of the Trustee and the Paying Agent in London during normal business hours on any weekday
    (Saturdays, Sundays and public holidays excepted):
    •    the charter of Sberbank and the Articles of Incorporation of the Issuer;
    •    the Trust Deed in respect of the Notes (including the forms of the Global Notes and definitive
         Notes);
    •    the Agency Agreement;
    •    each Final Terms for Notes (and each Loan Agreement in respect of such Notes) which are listed
         on the London Stock Exchange or any other stock exchange (save that Final Terms relating to
         a Note which is neither admitted to trading on a regulated market within the European
         Economic Area nor offered in the European Economic Area in circumstances where a
         prospectus is required to be published under the Prospectus Directive will only be available for
         inspection by a holder of such Note and such holder must produce evidence satisfactory to the
         Issuer, Sberbank and the Paying Agent as to its holding of Notes and identity); and
    •    a copy of this Base Prospectus together with any supplement to this Base Prospectus or further
         Base Prospectus.

                                                   191
    In addition, this Base Prospectus is also available at the registered office of the Issuer.
(8) Sberbank does not prepare financial statements in accordance with U.S. GAAP.
(9) The Notes have been accepted for clearance through Euroclear and Clearstream, Luxembourg. The
    Common Code and the ISIN and (where applicable) the CUSIP number and the identification
    number for any other relevant clearing system for each Series of Notes will be set out in the relevant
    Final Terms. In addition, application may be made to have Rule 144A Notes designated as eligible
    for trading on PORTAL.
(10) The European Union Transparency Obligations Directive is currently being finalised and may be
     implemented in the United Kingdom in a manner that is unduly burdensome for the Issuer and for
     Sberbank. In such circumstances the Issuer and/or Sberbank may, subject to the provisions of the
     Trust Deed, decide to seek an alternative listing for the Notes outside the European Union.
(11) As of the date of this Base Prospectus, Sberbank is in compliance with applicable Russian law
     corporate governance requirements in all material respects.
(12) Sberbank or the Issuer do not intend to provide any post-issuance transaction information regarding
     any Series of Notes or any Loan.




                                                   192
                                                  INDEX TO FINANCIAL STATEMENTS


IFRS financial statements for Sberbank as of and for the year ended December 31, 2005
Auditors’ report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       F-2
Independent auditors’ report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 F-3
Balance sheets as of December 31, 2005 and December 31, 2004 (restated) . . . . . . . . . . . . . . . .                                                        F-4
Statements of income for the years ended December 31, 2005 and December 31, 2004
  (restated) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   F-5
Statements of changes in equity for the years ended December 31, 2005 and December 31,
  2004 (restated) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        F-6
Statements of cash flows for the years ended December 31, 2005 and December 31, 2004
  (restated) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   F-7
Notes to the financial statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    F-8

Unrestated IFRS financial statements for Sberbank as of and for the year ended December 31, 2004
Independent auditors’ report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     F-64
Balance sheets as of December 31, 2004 and December 31, 2003. . . . . . . . . . . . . . . . . . . . . . . . . .                                    F-65
Statements of income for the years ended December 31, 2004 and December 31, 2003. . . . . . .                                                      F-66
Statements of cash flows for the years ended December 31, 2004 and December 31, 2003 . . . .                                                        F-67
Statements of changes in shareholders’ equity for the years ended December 31, 2004 and
  December 31, 2003. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-68
Notes to the financial statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        F-69




                                                                                   F-1
F-4
F-2
F-5
F-3
F-6
F-4
Sberbank (Savings Bank of the Russian Federation)
Statement of Income

                                                                    Note                  2005           2004
In thousands of Russian Roubles                                                                     (Restated)

Interest income                                                      25            245 521 854    166 734 284
Interest expense                                                     25            (89 148 954)   (84 930 051)


Net interest income                                                                156 372 900     81 804 233
Provision for loan impairment                                        11            (19 601 682)   (15 790 772)


Net interest income after provision for loan impairment                            136 771 218     66 013 461

Gains less losses arising from trading securities and other
 securities at fair value through profit or loss                                    16 144 622     13 862 219
Gains less losses arising from investment securities available
 for sale                                                                                4 709      2 830 446
Gains arising from investment securities held to maturity            14              4 180 969              -
(Losses net of gains)/gains less losses from trading in foreign
 currencies                                                                           (730 563)     5 017 305
Foreign exchange translation gains less losses                                       5 920 153     (1 598 441)
Fee and commission income                                            26             36 929 702    26 198 106
Fee and commission expense                                           26             (1 146 784)      (741 559)
Other operating income                                                               3 920 700      2 093 217


Operating profit                                                                   201 994 726    113 674 754
Administrative and other operating expenses                          27           (114 373 230)   (90 587 654)


Profit before tax                                                                   87 621 496     23 087 100
Income tax expense                                                   28            (21 813 964)    (4 919 463)


Profit for the year                                                                 65 807 532     18 167 637


Earnings per ordinary share, basic and diluted
 (expressed in RR per share)                                         29                   3 454          949




The notes set out on pages 5 to 60 form an integral part of these financial statements.                     2
                                                    F-7
                                                    F-5
Sberbank (Savings Bank of the Russian Federation)
Statement of Changes in Equity

                           Note        Share        Share    Treasury Revaluation        Fair value      Retained          Total
                                      capital    premium       shares reserve for      reserve for       earnings         equity
                                                                        premises       investment
                                                                                         securities
In thousands of                                                                       available for
  Russian Roubles                                                                              sale

Previously reported
 balance at
 31 December 2003                 20 980 583    10 016 190      (312)     474 987                -    103 401 715    134 873 163

Valuation of securities
 at fair value through
 profit or loss                            –            –          –             –               –      2 972 722      2 972 722
Fair value reserve for
 investment
 securities available
 for sale                                  –            –          –             –      2 635 312              –       2 635 312


Adjusted at
  1 January 2004                  20 980 583    10 016 190      (312)     474 987       2 635 312     106 374 437    140 481 197
Securities available
  for sale:
- Fair value losses
  net of gains                             –            –          –             –       (630 942)              –       (630 942)
- Disposals                                –            –          –             –     (2 830 446)              –     (2 830 446)
Premises and
  equipment:
- Depreciation of
  revalued premises                        –            –          –       (28 408)             –          28 408              –
Income tax recorded
  in equity                28              –            –          –         6 818        830 731          (6 818)      830 731
Profit for the year
      (Restated)                           –            –          –             –               –     18 167 637     18 167 637
Dividends declared         30              –            –          –             –               –     (2 699 593)    (2 699 593)



Balance at
 31 December 2004
 (Restated)                       20 980 583    10 016 190      (312)     453 397           4 655     121 864 071    153 318 584


Securities available for
  sale:
- Fair value losses
  net of gains                             –            –          –             –          (1 416)             –         (1 416)
- Disposals                                –            –          –             –          (4 709)             –         (4 709)
Premises and
  equipment:
- Revaluation of
  premises                 15              –            –          –    20 316 636               –              –     20 316 636
- Depreciation of
  revalued premises                        –            –          –       (27 118)              –         27 118              –
Income tax recorded
  in equity                28              –            –          –    (4 869 484)         1 470          (6 508)    (4 874 522)
Profit for the year                        –            –          –             –              –      65 807 532     65 807 532
Disposal of treasury
  shares                   23              –            –         11             –               –              –             11
Dividends declared         30              –            –          –             –               –     (3 493 600)    (3 493 600)


Balance at
 31 December 2005                 20 980 583    10 016 190      (301)   15 873 431               -    184 198 613    231 068 516




The notes set out on pages 5 to 60 form an integral part of these financial statements.                                    3
                                                       F-8
                                                       F-6
Sberbank (Savings Bank of the Russian Federation)
Statement of Cash Flows


                                                                       Note               2005           2004
In thousands of Russian Roubles                                                                     (Restated)

Cash flows from operating activities
Interest received                                                                  240 035 498    173 175 425
Interest paid                                                                      (85 975 914)   (83 684 506)
Income received from trading securities and other securities at fair
 value through profit or loss                                                       13 285 689     23 310 972
(Expenses paid)/Income received from trading in foreign
 currencies                                                                           (694 257)      5 100 101
Fees and commissions received                                                       36 759 581      26 198 106
Fees and commissions paid                                                           (1 146 784)     (1 404 036)
Other operating income received                                                      2 953 776       1 906 116
Administrative and other operating expenses paid                                  (100 207 885)    (80 845 285)
Income tax paid                                                                    (17 275 091)     (8 668 826)

Cash flows from operating activities before changes in
 operating assets and liabilities                                                   87 734 613     55 088 067

Changes in operating assets and liabilities
Net (increase)/decrease in mandatory cash balances with the
 Central Bank of the Russian Federation                                            (11 842 176)     53 927 005
Net (increase)/decrease in trading securities                                      (14 840 273)     11 301 301
Net increase in securities at fair value through profit or loss                    (15 960 399)    (27 339 030)
Net (increase)/decrease in due from other banks                                    (18 142 573)     67 327 122
Net increase in loans and advances to customers                                   (496 906 671)   (521 039 725)
Net increase in repurchase receivable                                               (1 042 751)              -
Net increase in other assets                                                       (10 302 665)     (3 442 271)
Net increase/(decrease) in due to other banks                                       11 975 303     (22 679 333)
Net increase in deposits from individuals                                          316 112 687     228 215 004
Net increase in customer accounts                                                  112 316 026     232 277 968
Net increase/(decrease) in debt securities in issue                                 24 113 692     (10 523 126)
Net increase/(decrease) in other liabilities                                         1 698 952        (796 236)

Net cash (used in)/from operating activities                                       (15 086 235)    62 316 746

Cash flows from investing activities
Proceeds from disposal and redemption of investment securities
 available for sale                                                                    108 834      21 952 314
Acquisition of premises and equipment                                  15          (26 011 675)    (16 290 865)
Proceeds from disposal of premises and equipment                       15            1 131 540         822 237
Dividend income received                                                               203 839          70 661

Net cash (used in)/from investing activities                                       (24 567 462)      6 554 347

Cash flows from financing activities
Proceeds from other borrowed funds                                                  32 229 271         925 168
Repayment of interest on other borrowed funds                                       (1 004 186)       (878 396)
Proceeds from subordinated debt                                                     28 340 000                -
Repayment of interest on subordinated debt                                            (901 556)               -
Disposal of treasury shares                                                                 11               -
Dividends paid                                                          30          (3 476 737)     (2 687 215)

Net cash from/(used in) financing activities                                        55 186 803      (2 640 443)

Effect of exchange rate changes on cash and cash equivalents                        (1 301 426)        (51 906)

Net increase in cash and cash equivalents                                           14 231 680     66 178 744
Cash and cash equivalents at the beginning of the year                             109 136 991     42 958 247

Cash and cash equivalents at the end of the year                        7          123 368 671    109 136 991




The notes set out on pages 5 to 60 form an integral part of these financial statements.                          4
                                                    F-9
                                                    F-7
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

1     Introduction

These financial statements have been prepared in accordance with International Financial Reporting
Standards for the year ended 31 December 2005 for Sberbank (Savings Bank of the Russian Federation)
(the “Bank”).

The Bank is a joint stock commercial bank established in 1841 and operated in various forms since then.
The Bank was incorporated and is domiciled in the Russian Federation. The Bank’s principal shareholder,
the Central Bank of the Russian Federation (the “CBRF”), owns 63.76% of ordinary shares or 60.57% of the
issued and outstanding shares at 31 December 2005.

The Board of Directors of the Bank is headed by the Chairman of the CBRF. The Board of Directors also
includes representatives from the Bank’s other shareholders. Two Deputy Chairmen of the CBRF are
Deputy Chairmen of the Board of Directors.

Principal activity The Bank’s principal business activity is corporate and retail banking operations within
the Russian Federation. The Bank has operated under a full banking license issued by the Central Bank of
the Russian Federation since 1991.

On 21 June 2004 the Bank applied for participation in the State deposit insurance scheme, which was
introduced by the Federal Law #177-FZ “Deposits of individuals insurance in the Russian Federation” dated
23 December 2003. On 29 December 2004 the CBRF, following the inspection of the Bank’s performance
to assess its compliance with the criteria set for the State deposit insurance scheme, officially informed the
Bank about its positive decision, and the Bank was accepted to the State deposit insurance scheme on
11 January 2005. The State deposit insurance scheme dictates that the State Deposit Insurance Agency will
guarantee repayment of individual deposits up to RR 100 thousand (approximately US Dollars 3 thousand)
per individual in case of the withdrawal of a license of a bank or a CBRF imposed moratorium on payments.
Prior to the admission to the State deposit insurance scheme, deposits of individuals placed with the Bank
were fully guaranteed by the State. After the Bank was admitted to the State deposit insurance scheme,
deposits of individuals placed before 1 October 2004 continued to be covered by the State guarantee until
1 January 2007 and deposits placed after 1 October 2004 are covered by the general terms of the State
deposit insurance scheme.

The Bank has 17 (2004:17) regional head offices, 992 (2004: 994) branches and 19 261 (2004:19 211) sub-
branches within the Russian Federation as at 31 December 2005. The average number of the Bank’s
employees during 2005 was 235 116 (2004: 228 531).

Registered address and place of business. The Bank’s registered address is: Vavilova str., 19,
Moscow, Russian Federation.

Presentation currency. These financial statements are presented in thousands of Russian Roubles
("RR thousands").


2     Operating Environment of the Bank

The Russian Federation displays certain characteristics of an emerging market, including the existence of
a currency that is not freely convertible in most countries outside of the Russian Federation, restrictive
currency controls, relatively high inflation and economic growth. The banking sector in the Russian
Federation is sensitive to adverse fluctuations in confidence and economic conditions. The Russian
economy occasionally experiences falls in confidence in the banking sector accompanied by reductions in
liquidity.




                                                                                                            5
                                               F-10
                                               F-8
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

2     Operating Environment of the Bank (Continued)

The tax, currency and customs legislation within the Russian Federation is subject to varying
interpretations, and changes, which can occur frequently. Furthermore, the need for further developments
in the bankruptcy laws, the absence of formalised procedures for the registration and enforcement of
collateral, and other legal and fiscal impediments contribute to the difficulties experienced by banks
currently operating in the Russian Federation. The future economic direction of the Russian Federation is
largely dependent upon the effectiveness of economic, financial and monetary measures undertaken by
the Government, together with tax, legal, regulatory, and political developments.


3     Basis of Preparation and Significant Accounting Policies

Basis of Preparation. These financial statements have been prepared in accordance with International
Financial Reporting Standards (“IFRS”) under the historical cost convention, as modified by the
inflationary adjustments and revaluation of premises, revaluation of available for sale financial assets,
financial assets and financial liabilities held at fair value through profit or loss and all derivative contracts.
The Bank maintains its accounting records in accordance with Russian banking regulations. These
financial statements have been prepared from these accounting records and adjusted as necessary in
order to be in accordance with IFRS.

The principal accounting policies applied in the preparation of these financial statements are set out
below. These policies have been consistently applied to all the periods presented, unless otherwise
stated. Refer to Note 5.

Key measurement terms. Depending on their classification financial instruments are carried at cost, fair
value, or amortised cost as described below.

Cost is the amount of cash or cash equivalents paid or the fair value of the other consideration given to
acquire an asset at the time of its acquisition and includes transaction costs. Transaction costs are
incremental costs that are directly attributable to the acquisition, issue or disposal of a financial
instrument. An incremental cost is one that would not have been incurred if the transaction had not taken
place. Transaction costs include fees and commissions paid to agents (including employees acting as
selling agents), advisors, brokers and dealers, levies by regulatory agencies and securities exchanges,
and transfer taxes and duties. Transaction costs do not include debt premiums or discounts, financing
costs or internal administrative or holding costs. The cost based measurement for financial instruments is
applied only in rare circumstances.

Fair value is the amount for which an asset could be exchanged, or a liability settled, between
knowledgeable, willing parties in an arm’s length transaction. Fair value is the current bid price for
financial assets and current asking price for financial liabilities which are quoted in an active market. A
financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly
available from an exchange or other institution and those prices represent actual and regularly occurring
market transactions on an arm’s length basis.

In other than active markets, the most recent arms length transactions are the basis of current fair values.
Recent transaction prices are appropriately adjusted if they do not reflect current fair values, for example
because the transaction was a distress sale. Fair value is not the amount that an entity would receive or
pay in a forced transaction, involuntary liquidation or distress sale.

Amortised cost is the amount at which the financial instrument was recognised at initial recognition less
any principal repayments, plus accrued interest, and for financial assets less any write-down for incurred
impairment losses. Accrued interest includes amortisation of transaction costs deferred at initial
recognition and of any premium or discount to maturity amount using the effective interest method.
Accrued interest income and accrued interest expense, including both accrued coupon and amortised
discount, are not presented separately and are included in the carrying values of the related balance
sheet items.




                                                                                                                6
                                                 F-11
                                                 F-9
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

The effective interest method is a method of allocating interest income or interest expense over the
relevant period so as to achieve a constant periodic rate of interest (effective interest rate) on the carrying
amount. The effective interest rate is the rate that discounts estimated future cash payments or receipts
(excluding future credit losses) through the expected life of the financial instrument or a shorter period, if
appropriate, to the net carrying amount of the financial instrument. The effective interest rate discounts
cash flows of variable interest instruments to the next interest repricing date except for the premium or
discount which reflects the credit spread over the floating rate specified in the instrument, or other
variables that are not reset to market rates. Such premiums or discounts are amortised over the whole
expected life of the instrument. The present value calculation includes all fees and points paid or received
between parties to the contract that are an integral part of the effective interest rate (refer to income and
expense recognition policy).

Initial recognition of financial assets. Trading securities, other securities at fair value through profit or
loss, derivatives and other financial assets at fair value through profit or loss are initially recorded at fair
value. All other financial assets are initially recorded at fair value plus transaction costs. Fair value at
initial recognition is best evidenced by the transaction price. A gain or loss on initial recognition is only
recorded if there is a difference between fair value and transaction price which can be evidenced by other
observable current market transactions in the same instrument or by a valuation technique whose inputs
include only data from observable markets.

All purchases and sales of financial assets that require delivery within the time frame established by
regulation or market convention (“regular way” purchases and sales) are recorded at trade date, which is
the date that the Bank commits to deliver a financial instrument. All other purchases and sales are
recognised when the entity becomes a party to the contractual provisions of the instrument.

Cash and cash equivalents. Cash and cash equivalents are items which can be converted into cash
within a day. All short term interbank placements, beyond overnight placements, are included in due from
other banks. Amounts, which relate to funds that are of a restricted nature, are excluded from cash and
cash equivalents.

Mandatory cash balances with the CBRF. Mandatory cash balances with the CBRF are carried at
amortised cost and represent non-interest bearing mandatory reserve deposits which are not available to
finance the Bank’s day to day operations and hence are not considered as part of cash and cash
equivalents for the purposes of the statement of cash flows.

Precious metals. Gold and other precious metals are recorded at the balance sheet date at London
fixing rates. Precious metals are included in other assets.

Trading securities. Trading securities are securities, which are either acquired for generating a profit
from short-term fluctuations in price or trader’s margin, or are securities included in a portfolio in which a
pattern of short-term trading exists. The Bank classifies securities into trading securities if it has an
intention to sell them within a short period after purchase, i.e. within six months. Trading securities are not
reclassified out of this category even when the Bank’s intentions subsequently change.

Trading securities are carried at fair value with changes in the fair value and gains or losses on
derecognition recorded in profit or loss as gains less losses from trading securities in the period in which
they arise. Interest earned on trading securities calculated using the effective interest method is
presented in the statement of income as interest income. Dividends are included in other operating
income when the Bank’s right to receive the dividend payment is established.

Other securities at fair value through profit or loss. Other securities at fair value through profit or loss
are securities designated irrevocably, at initial recognition, into this category. Recognition and
measurement of this category of financial assets is consistent with the above policy for trading securities.

Due from other banks. Amounts due from other banks are recorded when the Bank advances money to
counterparty banks with no intention of trading the resulting unquoted non-derivative receivable due on
fixed or determinable dates. Amounts due from other banks are carried at amortised cost.




                                                                                                              7
                                                F-12
                                                F-10
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Loans and advances to customers. Loans and advances to customers are recorded when the Bank
advances money to purchase or originate an unquoted non-derivative receivable from a customer due on
fixed or determinable dates and has no intention of trading the receivable. Loans and advances to
customers are carried at amortised cost.

Impairment of financial assets carried at amortised cost. Impairment losses are recognised in profit
or loss when incurred as a result of one or more events (“loss events”) that occurred after the initial
recognition of the financial asset and which have an impact on the amount or timing of the estimated
future cash flows of the financial asset or group of financial assets that can be reliably estimated. If the
Bank determines that no objective evidence exists that impairment was incurred for an individually
assessed financial asset, whether significant or not, it includes the asset in a group of financial assets
with similar credit risk characteristics and collectively assesses them for impairment.

For the purposes of a collective evaluation of impairment, financial assets are grouped on the basis of
similar credit risk characteristics. Those characteristics are relevant to the estimation of future cash flows
for groups of such assets by being indicative of the debtors’ ability to pay all amounts due according to
the contractual terms of the assets being evaluated.

Future cash flows in a group of financial assets that are collectively evaluated for impairment are
estimated on the basis of the contractual cash flows of the assets and historical loss experience in
respect of the extent to which amounts will become overdue as a result of past loss events and the
success of recovery of overdue amounts. Past experience is adjusted on the basis of current observable
data to reflect the effects of current conditions that did not affect past periods and to remove the effects of
past conditions that do not exist currently.

Impairment losses are recognised through an allowance account to write down the asset’s carrying
amount to the present value of expected cash flows (which exclude future credit losses that have not
been incurred) discounted at the original effective interest rate of the asset. The calculation of the present
value of the estimated future cash flows of a collateralised financial asset reflects the cash flows that may
result from foreclosure less costs for obtaining and selling the collateral, whether or not foreclosure is
probable.

After a loan has been written down as a result of impairment, interest income is then recognised using the
interest rate used to discount the future cash flows for the purpose of measuring the impairment loss.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised (such as an improvement in the
debtor’s credit rating), the previously recognised impairment loss is reversed by adjusting the allowance
account through profit or loss.

Uncollectible assets are written off against the related impairment loss provision after all the necessary
procedures to recover the asset have been completed and the amount of the loss has been determined.

Credit related commitments. In the normal course of business, the Bank enters into credit related
commitments, including letters of credit, guarantees, commitments to extend credit and undrawn credit
lines. Financial guarantees represent irrevocable assurance to make payments in the event that a
customer cannot meet its obligations to third parties and carry the same credit risk as loans. Premiums
received for the financial guarantees are amortised on a straight line basis during the life of the
guarantee. In determining the amount of provision for financial guarantees, Management uses best
estimates of the expenditures required to settle the obligations arising at the reporting date. The
estimates of outcome and financial effect are determined based on experience of similar transactions and
history of past losses, supplemented by the judgement of Management.




                                                                                                             8
                                               F-13
                                               F-11
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Investment securities available for sale. This classification includes investment securities which the
Bank intends to hold for an indefinite period of time and which may be sold in response to needs for
liquidity or changes in interest rates, exchange rates or equity prices. The Bank classifies investments as
available for sale at the time of purchase and reassesses that classification at each subsequent balance
sheet date.

Investment securities available for sale are carried at fair value. Interest income on available for sale debt
securities is calculated using the effective interest method and recognised in profit or loss. Dividends on
available-for-sale equity instruments are recognised in profit or loss when the Bank’s right to receive payment
is established. All other elements of changes in the fair value are deferred in equity until the investment is
derecognised or impaired, at which time the cumulative gain or loss is removed from equity to profit or loss.

Impairment losses are recognised in profit or loss when incurred as a result of one or more events (“loss
events”) that occurred after the initial recognition of investment securities available for sale. A significant
or prolonged decline in the fair value of an equity security below its cost is an indicator that it is impaired.
The cumulative impairment loss – measured as the difference between the acquisition cost and the
current fair value, less any impairment loss on that asset previously recognised in profit or loss – is
removed from equity and recognised in profit or loss. Impairment losses on equity instruments are not
reversed through profit or loss. If, in a subsequent period, the fair value of a debt instrument classified as
available for sale increases and the increase can be objectively related to an event occurring after the
impairment loss was recognised in profit or loss, the impairment loss is reversed through current period’s
profit or loss.

Sale and repurchase agreements. Sale and repurchase agreements (“repo agreements”) are treated as
secured financing transactions. Securities sold under sale and repurchase agreements are not
derecognised. The securities are not reclassified in the balance sheet unless the transferee has the right
by contract or custom to sell or repledge the securities, in which case they are reclassified as repurchase
receivables. The corresponding liability is presented within amounts due to other banks.

Securities purchased under agreements to resell (“reverse repo agreements”) are recorded as due from
other banks or loans and advances to customers, as appropriate. The difference between the sale and
repurchase price is treated as interest income and accrued over the life of repo agreements using the
effective interest method.

Investment securities held to maturity. This classification includes quoted non-derivative financial
assets with fixed or determinable payments and fixed maturities that the Bank has both the intention and
ability to hold to maturity. Management determines the classification of investment securities held to
maturity at their initial recognition and reassesses the appropriateness of that classification at each
balance sheet date. Investment securities held to maturity are carried at amortised cost.

Derecognition of financial assets. The Bank derecognises financial assets when (i) the assets are
redeemed or the rights to cash flows from the assets otherwise expired or (ii) the Bank has transferred
substantially all the risks and rewards of ownership of the assets or (iii) the Bank has neither transferred
nor retained substantially all risks and rewards of ownership but has not retained control. Control is
retained if the counterparty does not have the practical ability to sell the asset in its entirety to an
unrelated third party without needing to impose additional restrictions on the sale.

Premises and equipment. Premises are stated at fair value, as described below. Equipment is stated at
cost, restated to the equivalent purchasing power of the Russian Rouble at 31 December 2002 for assets
acquired prior to 1 January 2003, less accumulated depreciation and provision for impairment, where
required.

Premises of the Bank are subject to revaluation on a regular basis. The frequency of revaluation depends
upon the movements in the fair values of the premises and equipment being revalued. The revaluation
reserve for premises included in equity is transferred directly to retained earnings when the surplus is
realised, i.e. either on the retirement or disposal of the asset, or as the asset is used by the Bank; in the
latter case, the amount of the surplus realised is the difference between depreciation based on the revalued
carrying amount of the asset and depreciation based on the asset’s original cost.




                                                                                                              9
                                                F-14
                                                F-12
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Premises have been revalued to market value at 31 December 2005. The revaluation was performed
based on the reports of independent appraisers, who hold a recognised and relevant professional
qualification and who have recent experience in valuation of assets of similar location and category. The
basis used for the appraisal was fair value.

Construction in progress is carried at cost, less provision for impairment where required. Upon
completion, assets are transferred to premises and equipment at their carrying amount. Construction in
progress is not depreciated until the asset is available for use.

All other items of premises and equipment are stated at cost less accumulated depreciation and
impairment losses, if any.

Costs of minor repairs and maintenance are expensed when incurred. Cost of replacing major parts or
components of premises and equipment items are capitalised and the replaced part is retired.

If impaired, premises and equipment are written down to the higher of their value in use and fair value
less costs to sell. The decrease in carrying amount is charged to profit or loss to the extent it exceeds the
previous revaluation surplus in equity. An impairment loss recognised for an asset in prior years is
reversed if there has been a change in the estimates used to determine the asset’s value in use or fair
value less costs to sell.

Gains and losses on disposals determined by comparing proceeds with carrying amount are recognised
in profit or loss.

Depreciation. Land is not depreciated. Depreciation on other items of premises and equipment is
calculated using the straight-line method to allocate cost or revalued amounts of premises and equipment
to their residual values over the estimated remaining useful lives. The following annual rates are applied
for the main categories of premises and equipment:

Premises                               2.5-4.5%;

Office and computer equipment          25%; and

Vehicles and other equipment           18%.

The residual value of an asset is the estimated amount that the Bank would currently obtain from disposal
of the asset less the estimated costs of disposal, if the asset were already of the age and in the condition
expected at the end of its useful life. The residual value of an asset is nil if the Bank expects to use the
asset until the end of its physical life. The assets’ residual values and useful lives are reviewed, and
adjusted if appropriate, at each balance sheet date.

Operating leases. Where the Bank is a lessee in a lease which does not transfer substantially all the
risks and rewards incidental to ownership from the lessor to the Bank, the total lease payments, including
those on expected termination, are charged to profit or loss on a straight-line basis over the period of the
lease.

Due to other banks. Amounts due to other banks are recorded when money or other assets are
advanced to the Bank by counterparty banks. The non-derivative liability is carried at amortised cost.

Deposits from individuals and customer accounts. Deposits from individuals and customer accounts
are non-derivative liabilities to individuals, state or corporate customers and are carried at amortised cost.

Debt securities in issue. Debt securities in issue include promissory notes, certificates of deposit and
savings certificates issued by the Bank. Debt securities are stated at amortised cost.

Other borrowed funds. Other borrowed funds represent medium and long-term funds attracted by the
Bank on the international financial markets. Other borrowed funds are carried at amortised cost. If the
Bank repurchases its borrowed funds, they are removed from the balance sheet and the difference
between the carrying amount of the liability and the consideration paid is included in gains/(losses) arising
from retirement of debt.



                                                                                                           10
                                               F-15
                                               F-13
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Derivative financial instruments. Derivative financial instruments, including forward and futures foreign
exchange contracts and forwards with precious metals, are carried at their fair value. All derivative
instruments are carried as assets when fair value is positive and as liabilities when fair value is negative.
Changes in the fair value of derivative instruments are included in profit or loss as gains less losses
arising from trading in foreign currencies and other operating income. The Bank does not apply hedge
accounting.

Income taxes. Income taxes have been provided for in the financial statements in accordance with
Russian legislation enacted or substantively enacted by the balance sheet date. The income tax charge
comprises current tax and deferred tax and is recognised in the statement of income except if it is
recognised directly in equity because it relates to transactions that are also recognised, in the same or a
different period, directly in equity.

Current tax is the amount expected to be paid to or recovered from the taxation authorities in respect of
taxable profits or losses for the current and prior periods. Taxable profits or losses are based on
estimates if financial statements are authorised prior to filing relevant tax returns. Taxes, other than on
income, are recorded within administrative and other operating expenses.

Deferred income tax is provided using the balance sheet liability method for tax loss carry forwards and
temporary differences arising between the tax bases of assets and liabilities and their carrying amounts
for financial reporting purposes. In accordance with the initial recognition exemption, deferred taxes are
not recorded for temporary differences on initial recognition of an asset or a liability in a transaction other
than a business combination if the transaction, when initially recorded, affects neither accounting nor
taxable profit. Deferred tax balances are measured at tax rates enacted or substantively enacted at the
balance sheet date which are expected to apply to the period when the temporary differences will reverse
or the tax loss carry forwards will be utilised. Deferred tax assets for deductible temporary differences and
tax loss carry forwards are recorded in the balance sheet only to the extent that it is probable that future
taxable profit will be available against which the deductions can be utilised.

Provision for liabilities and charges. Provisions for liabilities and charges are non-financial liabilities of
uncertain timing or amount. They are accrued when the Bank has a present legal or constructive
obligation as a result of past events, it is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can
be made.

Trade and other payables. Trade payables are accrued when the counterparty performed its obligations
under the contract and are carried at amortised cost.

Share premium. Share premium represents the excess of contributions over the nominal value of the
shares issued.

Preference shares. Preference shares are not redeemable. Dividend payments are at the discretion of
the Bank. When a dividend is paid, the preference shares attract a minimum payment of annual dividends
of 15% of their nominal value, subject to confirmation of the shareholders’ meeting. Dividend payments in
excess of that minimum level are determined at the Bank’s annual shareholders’ meeting. Preference
shares are classified as a part of equity.

Treasury shares. Where the Bank purchases the Bank’s equity instruments, the consideration paid
including any attributable incremental external costs net of income taxes is deducted from equity
attributable to the equity holders of the Bank until they are cancelled or disposed of. Where such shares
are subsequently disposed or reissued, any consideration received is included in equity.

Dividends. Dividends are recorded in equity in the period in which they are declared. Dividends declared
after the balance sheet date and before the financial statements are authorised for issue are disclosed in
the subsequent events note. The statutory accounting reports of the Bank are the basis for profit
distribution and other appropriations. Russian legislation identifies the basis of distribution as the current
year net profit.




                                                                                                            11
                                               F-16
                                               F-14
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Income and expense recognition. Interest income and expense are recorded in the statement of income for
interest-bearing instruments on an accrual basis using the effective interest method. This method defers, as
part of interest income or expense, all fees paid or received between the parties to the contract that are an
integral part of the effective interest rate, transaction costs and all other premiums or discounts.

Fees integral to the effective interest rate include origination fees received or paid by the entity relating to
the creation or acquisition of a financial asset or issuance of a financial liability, for example fees for
evaluating creditworthiness, evaluating and recording guarantees or collateral, negotiating the terms of
the instrument and for processing transaction documents. Commitment fees received by the Bank to
originate loans at market interest rates are integral to the effective interest rate if it is probable that the
Bank will enter into a specific lending arrangement and does not expect to sell the resulting loan shortly
after origination. The Bank does not designate loan commitments as financial liabilities at fair value
through profit or loss.

When loans and other debt instruments become doubtful of collection, they are written down to present value
of expected cash inflows and interest income is thereafter recorded for the unwinding of the present value
discount based on the asset’s original effective interest rate which was used to measure the impairment loss.

All other fees, commissions and other income and expense items are generally recorded on an accrual
basis by reference to completion of the specific transaction assessed on the basis of the actual service
provided as a proportion of the total services to be provided.

Commissions and fees arising from negotiating, or participating in the negotiation of a transaction for a
third party, such as the acquisition of loans, shares or other securities or the purchase or sale of
businesses, which are earned on execution of the underlying transaction are recorded on its completion.
Portfolio and other management advisory and service fees are recognised based on the applicable
service contracts, usually on a time-proportion basis. Trust and custody services fees related to
investment funds are recorded rateably over the period the service is provided.

Foreign currency translation. Functional currency of the Bank is the currency of the primary economic
environment in which the Bank operates. The Bank’s functional currency and presentation currency is the
national currency of the Russian Federation, Russian Roubles (“RR”).

Monetary assets and liabilities are translated into the Bank’s functional currency at the official exchange
rate of the CBRF at the respective balance sheet dates. Foreign exchange gains and losses resulting
from the settlement of the transactions and from the translation of monetary assets and liabilities into the
Bank’s functional currency at year-end official exchange rates of the CBRF are recognised in profit or
loss. Translation at year-end rates does not apply to non-monetary items.

At 31 December 2005 the principal rate of exchange used for translating foreign currency balances was
USD 1 = RR 28.7825 (2004: USD 1 = RR 27.7487). Exchange restrictions and controls exist relating to
converting Russian Roubles into other currencies. At present, the Russian Rouble is not a freely
convertible currency in most countries outside of the Russian Federation.

Fiduciary assets. Assets and liabilities held by the Bank in its own name, but on the account of third
parties, are not reported on the balance sheet. The extent of such balances and transactions is indicated
in Note 33. For the purposes of disclosure, fiduciary activities do not encompass safe custody functions.
Commissions received from fiduciary activities are shown in fee and commission income.

Contingent assets. Contingent assets are possible assets that arise from past events and whose
existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future
events not wholly within the control of the Bank. Contingent assets are not recognised by the Bank in its
balance sheet, but disclosed in the notes to the financial statements.

Offsetting. Financial assets and liabilities are offset and the net amount reported in the balance sheet
only when there is a legally enforceable right to offset the recognised amounts, and there is an intention
to either settle on a net basis, or to realise the asset and settle the liability simultaneously.




                                                                                                             12
                                                F-17
                                                F-15
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

3     Basis of Preparation and Significant Accounting Policies (Continued)

Accounting for the effects of hyperinflation. The Russian Federation has previously experienced
relatively high levels of inflation and was considered to be hyperinflationary as defined by
IAS 29 “Financial Reporting in Hyperinflationary Economies” (“IAS 29”). IAS 29 requires that the financial
statements prepared in the currency of a hyperinflationary economy be stated in terms of the measuring
unit current at the balance sheet date. It states that reporting operating results and financial position in the
local currency without restatement is not useful because money loses purchasing power at such a rate
that the comparison of amounts from transactions and other events that have occurred at different times,
even within the same accounting period, is misleading.

The characteristics of the economic environment of the Russian Federation indicate that hyperinflation
has ceased effective from 1 January 2003. Restatement procedures of IAS 29 are therefore only applied
to assets acquired or revalued and liabilities incurred or assumed prior to that date. For these balances,
the amounts expressed in the measuring unit current at as 31 December 2002 are the basis for the
carrying amounts in these financial statements. The restatement was calculated using the conversion
factors derived from the Russian Federation Consumer Price Index (“CPI”), published by the Russian
Statistics Agency, and from indices obtained from other sources for years prior to 1992.

Staff costs and related contributions. Wages, salaries, contributions to the Russian Federation state
pension and social insurance funds, paid annual leave and sick leave, bonuses, and non-monetary
benefits are accrued in the year in which the associated services are rendered by the employees of the
Bank.

Segment reporting. A segment is a distinguishable component of the Bank that is engaged either in
providing products or services (business segment) or in providing products or services within a particular
economic environment (geographical segment), which is subject to risks and rewards that are different
from those of other segments. Segments with a majority of revenue earned from sales to external
customers and whose revenue, result or assets are ten percent or more of all the segments are reported
separately.

Changes in presentation. Where necessary, corresponding figures have been adjusted to conform with
changes in the presentation of the current year. The following significant reclassifications have been
made to 2004 balances to conform to the 2005 presentation:

As previously             Reclassified                        Amount                                Comment
reported                                                (In thousands
                                                            of Russian
                                                              Roubles)

                                                                         Precious metals balances and restricted
Cash and cash                                                            cash have been recognised as part of
 equivalents              Other assets                     4 481 389     other assets.

                                                                         Balances on the accounts of individual
                                                                         entrepreneurs have been recognised as
Deposits from individuals Customer accounts                9 438 660     part of customer accounts.

                                                                         Long-term loan received by the Bank
                                                                         have been recognised as part of other
Debt securities issued    Other borrowed funds            27 781 693     borrowed funds.


These financial statements were approved for issue by the Board on 20 April 2006 and further changes
require approval of the body that gave that authorisation.




                                                                                                                 13
                                                 F-18
                                                 F-16
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

4     Critical Accounting Estimates, and Judgements in Applying Accounting Policies

The Bank makes estimates and assumptions that affect the reported amounts of assets and liabilities
within the next financial year. Estimates and judgements are continually evaluated and are based on
Management’s experience and other factors, including expectations of future events that are believed to
be reasonable under the circumstances. Management also makes certain judgements, apart from those
involving estimations, in the process of applying the accounting policies. Judgements that have the most
significant effect on the amounts recognised in the financial statements and estimates that can cause a
significant adjustment to the carrying amount of assets and liabilities within the next financial year include:

Held-to-maturity financial assets. Management applies judgement in assessing whether financial
assets can be categorised as held-to-maturity, in particular its intention and ability to hold the assets to
maturity. If the Bank fails to keep these investments to maturity other than for certain specific
circumstances – for example, selling an insignificant amount close to maturity, or sale or reclassification is
attributable to an isolated event that is beyond the Bank’s control, is non-recurring and could not have
been reasonably anticipated by the Bank – it will be required to reclassify the entire class as available-for-
sale. The investments would therefore be measured at fair value rather than amortised cost. If the entire
class of held-to-maturity investments was tainted, the carrying amount would increase by
RR 25 102 431 thousand, with a corresponding entry to the fair value reserve in equity net of deferred tax
of RR 6 024 583 thousand.

Impairment of equity investment securities available for sale. The Bank determines that available-for-
sale equity investment securities available for sale are impaired when there has been a significant or
prolonged decline in the fair value below its cost. This determination of what is significant or prolonged
requires judgement. In making this judgement, the Bank evaluates among other factors, the volatility in
share price. In addition, impairment may be appropriate when there is evidence of a deterioration in the
financial health of the investee, industry and sector performance, changes in technology, and operational
or financing cash flows.

Impairment losses on loans and advances. The Bank regularly reviews its loan portfolios to assess
impairment. In determining whether an impairment loss should be recorded in the statement of income,
the Bank makes judgements as to whether there is any observable data indicating that there is a
measurable decrease in the estimated future cash flows from a portfolio of loans before the decrease can
be identified with an individual loan in that portfolio. This evidence may include observable data indicating
that there has been an adverse change in the payment status of borrowers in a group, or national or local
economic conditions that correlate with defaults on assets in the group. Management uses estimates
based on historical loss experience for assets with credit risk characteristics and objective evidence of
impairment similar to those in the portfolio when scheduling its future cash flows. For new types of loans,
where the Bank has not collected statistics of historical losses, market information on historical losses of
similar groups of loans is used to assess incurred but not yet reported losses on such groups of loans.
Also, the Bank’s management accounting system in some cases does not allow to collect all necessary
information on incurred losses for certain groups of loans. Management uses estimates and incurred loss
models for groups of loans with similar credit risk profile. Management is also in process of upgrading
Bank’s accounting systems to produce fully the information required for proper application of loan portfolio
impairment assessment. The methodology and assumptions used for estimating both the amount and
timing of future cash flows are reviewed regularly to reduce any differences between loss estimates and
actual loss experience.

Tax legislation. Russian tax, currency and customs legislation is subject to varying interpretations. Refer
to Note 33.




                                                                                                            14
                                               F-19
                                               F-17
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

4     Critical Accounting Estimates, and Judgments in Applying Accounting Policies (Continued)

Fair Value of Financial Instruments. Fair value is the amount at which a financial instrument could be
exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and
is best evidenced by an active quoted market price. The estimated fair values of financial instruments
have been determined by the Bank using available market information, where it exists, and appropriate
valuation methodologies. However, judgement is necessarily required to interpret market data to
determine the estimated fair value. The fair values of financial derivatives that are not quoted in active
markets are determined by using valuation techniques. To the extent practical, models use only
observable data, however certain areas require Management to make estimates. Changes in
assumptions about these factors could affect reported fair values. The Russian Federation continues to
display some characteristics of an emerging market and economic conditions continue to limit the volume
of activity in the financial markets. Market quotations may be outdated or reflect distress sale transactions
and therefore not represent fair values of financial instruments. Management has used all available
market information in estimating the fair value of financial instruments.

Capital Adequacy Ratio. Capital Adequacy Ratio is calculated in accordance with the International
Convergence of Capital Measurement and Capital Standards (July 1988, updated to April 1998) (or Basel
Capital Accord) requirements. Such requirements are subject to interpretation and accordingly the
appropriateness of the inclusion, exclusion, and/or classification of amounts included in the calculation of
the Capital Adequacy Ratio requires Management judgement.

Related party transactions. The Bank’s principal shareholder is the Central Bank of the Russian
Federation (refer to Note 1). As the Bank adopted IAS 24 “Related Party Disclosures” (revised),
disclosures are made in these financial statements for transactions with state-controlled entities and
government bodies. Currently the Government of the Russian Federation does not provide to the general
public or entities under its ownership/control a complete list of the entities which are owned or controlled
directly or indirectly by the State. Judgement is applied by the Management in determining the scope of
operations with related parties to be disclosed in the financial statements. Refer to Notes 36 and 37.


5     Adoption of New or Revised Standards and Interpretations

Certain new IFRSs became effective for the Bank from 1 January 2005. Listed below are those new or
amended standards or interpretations, which are or in the future could be relevant to the Bank’s
operations and the nature of their impact on the Bank’s accounting policies. All changes in accounting
policies were applied retrospectively with adjustments made to the retained earnings at 1 January 2004,
unless otherwise described below.

IAS 1 (revised 2003), Presentation of Financial Statements. Certain new disclosures and changes in
presentation required by the revised standard were made in these financial statements.

IAS 8 (revised 2003) Accounting Policies, Changes in Accounting Estimates and Errors. The Bank
now applies all voluntary changes in accounting policies retrospectively. Comparatives are amended in
accordance with the new policies. All material errors are now corrected retrospectively in the first set of
financial statements after their discovery.

IAS 16 (revised 2003) Property, Plant and Equipment. The residual value is now defined as the
amount that the Bank estimates it would receive currently for the asset if the asset were already of the
age and in the condition expected at the end of its useful life. The Bank’s policy is now not to cease
depreciating assets during temporary periods when the assets are idle. All changes to accounting policies
as a result of the revised IAS 16 were accounted retrospectively and did not result in a significant effect
on the carrying amount of the Bank’s assets.

IAS 24 (revised 2003) Related Party Disclosures. The definition of related parties was extended and
additional disclosures required by the revised standard were made in these financial statements.

IAS 33 (revised 2003) Earnings per Share. IAS 33 was revised to provide additional guidance and
illustrative examples on selected complex matters. The Bank did not have to change its accounting
policies as a result of the new guidance.




                                                                                                          15
                                               F-20
                                               F-18
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

5     Adoption of New or Revised Standards and Interpretations (Continued)

IAS 39 (revised 2003) Financial Instruments: Recognition and Measurement. The definition of
‘originated loans and receivables’ was amended to become ‘loans and receivables’. This category now
comprises originated or purchased loans and receivables that are not quoted in an active market. The
Bank amended its policies and may designate any financial instrument on initial recognition as one to be
measured at fair value, with changes in fair value recognised in profit or loss. Subsequent
reclassifications into or out of the ‘at fair value through profit or loss’ category are prohibited. The Bank no
longer recognises gains and losses on available-for-sale financial assets in profit or loss but in equity.

As allowed by the standard, the Bank has redesignated such financial instruments as federal loan bonds
(OFZ bonds), corporate bonds and the Russian Federation Eurobonds into ‘at fair value through profit or
loss’ or ‘available for sale or ‘held to maturity’ categories at the date of initial application of the revised IAS
39. Part of these securities previously recorded as originated loans and receivables have been classified
at fair value through profit or loss category because they are designated as such based on the
unrestricted version of the fair value option in IAS 39 (revised).

The Bank amended its policies for derecognition of financial assets. Under the original IAS 39, several
concepts governed derecognition. The revised IAS 39 retains the two main concepts of risks and rewards
and control, but clarifies that the evaluation of the transfer of risks and rewards precedes the evaluation of
the transfer of control. Also, under the revised IAS 39 it was clarified that the impairment calculation is
based on an incurred loss model. In accordance with the standard’s transitional provisions the revised
accounting policies are applied retrospectively.

Opening equity at 1 January 2004 was increased by RR 5 608 034 thousand as a result of adoption of the
above new or revised standards and interpretations. The impact of adoption of new or revised standards
on the 2004 movements in equity is as follows:

In thousands of Russian Roubles                                                                     Total equity

Balance at 1 January 2004 (as previously reported)                                                  134 873 163
Valuation of securities at fair value through profit or loss                                          2 972 722
Fair value reserve for investment securities available for sale                                       2 635 312


Balance at 1 January 2004 (restated)                                                                140 481 197
Movements in fair value reserve for investment securities available for sale (restated)              (3 461 388)
Income tax recorded directly to equity (restated)                                                       830 731
Profit for the year (restated)                                                                       18 167 637
Dividends declared                                                                                   (2 699 593)


Balance at 31 December 2004 (restated)                                                              153 318 584




                                                                                                                16
                                                   F-21
                                                   F-19
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

5     Adoption of New or Revised Standards and Interpretations (Continued)

Included in the above adjustments are effects of the reclassification of quoted securities included in
originated loans and receivables with a prior amortised cost carrying amount of RR 21 541 768 thousand
at 31 December 2004 (RR 16 119 124 thousand at 1 January 2004) into the fair value through profit or
loss category at a fair value of RR 23 971 970 thousand at the same date (RR 20 030 600 thousand at
1 January 2004) and effect of the reclassification of quoted securities included in originated loans and
receivables with a prior amortised cost carrying amount of RR 106 171 thousand at 31 December 2004
(RR 19 827 200 thousand at 1 January 2004) into the available for sale category at a fair value of
RR 112 296 thousand at the same date (RR 23 294 715 thousand at 1 January 2004). Effect of this
restatement on statement of income for the year ended 31 December 2004 is presented in the table
below. Part of these originated loans and receivables have been classified at fair value through profit or
loss category because they are designated as such based on the unrestricted version of the fair value
option in IAS 39 (revised).

The impact of adoption of new or revised standards on the 2004 statement of income is as follows:

                                                    2004        Adjustment as a                     2004
                                          (As previously    result of adoption of              (Restated)
                                               reported)          new or revised
In thousands of Russian Roubles                                        standards

Interest income                             166 734 284                         -            166 734 284
Interest expense                            (84 930 051)                        -            (84 930 051)


Net interest income                           81 804 233                        -             81 804 233
Provision for loan impairment                (15 790 772)                       -            (15 790 772)


Net interest income after
 provision for loan impairment               66 013 461                        -              66 013 461

Gains less losses arising from
 trading securities and other
 securities at fair value through
 profit or loss                              15 343 493               (1 481 274)             13 862 219
Gains less losses arising from
 investment securities available for
 sale                                          2 830 446                        -              2 830 446
Gains less losses from trading in
 foreign currencies                            5 017 305                        -              5 017 305
Foreign exchange translation
 losses net of gains                         (1 598 441)                        -             (1 598 441)
Fee and commission income                    26 198 106                         -             26 198 106
Fee and commission expense                     (741 559)                        -               (741 559)
Other operating income                        2 093 217                         -              2 093 217


Operating profit                            115 156 028               (1 481 274)            113 674 754
Administrative and other operating
 expenses                                    (90 587 654)                       -            (90 587 654)


Profit before tax                            24 568 374               (1 481 274)             23 087 100
Income tax expense                           (5 281 787)                 362 324              (4 919 463)


Profit for the year                          19 286 587               (1 118 950)             18 167 637




                                                                                                       17
                                             F-22
                                             F-20
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

5     Adoption of New or Revised Standards and Interpretations (Continued)

The impact of adoption of new or revised standards on the 2004 balance sheet is as follows:

                                                   2004    Adjustment as a result                     2004
                                         (As previously     of adoption of new or                (Restated)
In thousands of Russian Roubles               reported)         revised standards

ASSETS
Cash and cash equivalents                   109 136 991                         -              109 136 991
Mandatory cash balances with the
 Central Bank of the Russian
 Federation                                  44 966 603                         -               44 966 603
Trading securities                          117 036 694                         -              117 036 694
Other securities at fair value
 through profit or loss                                -              215 569 169               215 569 169
Due from other banks                          10 576 697                        -                10 576 697
Loans and advances to customers            1 298 006 237                        -             1 298 006 237
Investment securities available for
 sale                                       191 597 199              (191 484 903)                 112 296
Investment securities held to
 maturity                                              -               35 650 135               35 650 135
Securities acquired at original
 issuance                                    57 298 074               (57 298 074)                       -
Deferred income tax asset                     6 685 802                  (584 718)               6 101 084
Premises and equipment                       72 381 032                         -               72 381 032
Other assets                                 12 683 018                         -               12 683 018


TOTAL ASSETS                               1 920 368 347                1 851 609             1 922 219 956


LIABILITIES
Due to other banks                            12 949 575                        -                12 949 575
Deposits from individuals                  1 199 916 878                        -             1 199 916 878
Customer accounts                            454 384 812                        -               454 384 812
Debt securities in issue                      63 313 212                        -                63 313 212
Other borrowed funds                          29 763 322                        -                29 763 322
Other liabilities                              8 573 573                        -                 8 573 573


TOTAL LIABILITIES                          1 768 901 372                        -             1 768 901 372


EQUITY
Share capital                                20 980 583                         -               20 980 583
Share premium                                10 016 190                         -               10 016 190
Treasury shares                                    (312)                        -                     (312)
Revaluation reserve for premises                453 397                         -                  453 397
Fair value reserve for investment
 securities available for sale                        -                     4 655                    4 655
Retained earnings                           120 017 117                 1 846 954              121 864 071


TOTAL EQUITY                                151 466 975                 1 851 609              153 318 584


TOTAL LIABILITIES AND EQUITY               1 920 368 347                1 851 609             1 922 219 956




                                                                                                        18
                                             F-23
                                             F-21
Sberbank (Savings Bank of the Russian Federation)
Notes to the Financial Statements - 31 December 2005

6     New Accounting Pronouncements

Certain new standards and interpretations have been published that are mandatory for the Bank’s
accounting periods beginning on or after 1 January 2006 or later periods and which the Bank has not
early adopted:

IAS 39 (Amendment) – The Fair Value Option. IAS 39 (as revised in 2003) permitted entities to
designate irrevocably on initial recognition practically any financial instrument as one to be measured at
fair value with gains and losses recognised in profit or loss (‘fair value through profit or loss’). The
amendment restricts the ability to designate financial instruments as part of this category.

IAS 39 (Amendment) – Financial Guarantee Contracts. Issued financial guarantees, other than those
previously asserted by the entity to be insurance contracts, will have to be initially recognised at their fair
value, and subsequently measured at the higher of (i) the unamortised balance of the related fees
received and deferred and (ii) the amount recognised under IAS 37 “Provisions, Contingent Liabilities and
Contingent Assets”.

IFRS 7 Financial Instruments: Disclosures and a complementary Amendment to
IAS 1 Presentation of Financial Statements - Capital Disclosures. IFRS 7 introduces new disclosures
to improve the information about financial instruments. It replaces IAS 30, Disclosures in the Financial
Statements of Banks and Similar Financial Institutions, and some of the requirements in IAS 32, Financial
Instruments: Disclosure and Presentation. The Amendment to IAS 1 introduces disclosures about level of
an entity’s capital and how it manages capital. The Bank is currently assessing what impact IFRS 7 and
the amendment to IAS 1 will have on disclosures in its financial statements.


7     Cash and Cash Equivalents

In thousands of Russian Roubles                                                     2005                2004

Cash on hand                                                                  58 281 759          45 271 165
Cash balances with the CBRF (other than mandatory reserve deposits)           26 946 095          41 667 705
Correspondent accounts and overnight placements with other banks
- Russian Federation                                                          14 551 561           1 932 558
- Other countries                                                             23 589 256          20 265 563


Total cash and cash equivalents                                             123 368 671          109 136 991


Geographical, currency and interest rate analyses of cash and cash equivalents are disclosed in
Note 32. The information on related party balances is disclosed in Notes 36 and 37.


8     Trading securities

In thousands of Russian Roubles                                                     2005                2004

Federal loan bonds (OFZ bonds)                                                52 661 881          32 582 435
Russian Federation Eurobonds                                                  35 956 096          48 569 256
Bonds of the CBRF                                                             24 461 159             904 534
Municipal and subfederal bonds                                                 7 423 572          27 286 179
Corporate bonds                                                                5 619 056           2 008 527
VneshEconomBank 3% coupon bonds (VEB bonds)                                    5 194 514           1 482 740
Corporate shares                                                                 499 149           4 203 023


Total trading securities                                                     131 815 427         117 036 694