Expansion of Customer Mortgage Agreement

THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS RESTRICTED AND

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR

INDIRECTLY IN THE UNITED STATES OF AMERICA

PIK GROUP ("The Group" or "PIK")

EXPANSION OF AGREEMENT WITH GAZPROMBANK

FOR CUSTOMER MORTGAGES

(LONDON, July 21 2010) - PIK Group (LSE: PIK), one of Russia's leading residential real estate developers, is pleased to announce that it has reached agreement with Gazprombank for the expansion of its programme, first announced on 02 June 2010, to issue mortgages to PIK customers for properties under construction.

Under the initial agreement, two mass market projects in Moscow region were selected for the program, which offered base contract terms to customers including loan-to-value ('LTV') of up to 80%, a RUB interest rate at 13% (fixed), and maturity of up to 25 years.

The mortgage program will now be being expanded and an additional Moscow-based project added into the program. Accordingly, PIK will have three mass market projects where property under construction can be bought through mortgages provided by the Gazprombank. At present, the mortgage program is applicable to the following apartment buildings, with new buildings added to the scheme as construction is launched.

The buildings where the project is currently applicable are as follows:

·; Mass market project "Yaroslavsky" in the city of Mytischi (located in the Moscow region), Building 9. Upon completion, it will comprise approx. 250 flats and will accommodate 700 people. Upon completion, the full Yaroslavsky residential project will consist of two micro districts including 41 buildings and comprising approximately 18,000 flats and 50,000 citizens;

·; Mass market project "Krasnaya Gorka" in the city of Lubercy (located in the Moscow region), buildings 16, 19, 31, 32. Upon completion, they will comprise approximately 1,700 flats and will accommodate 4,700 people. Upon full completion, Krasnaya Gorka will consist of 34 buildings, holding approximately 10,000 flats and will accommodate 30,000 citizens;

·; Mass market project "Bicevsky" (located in Moscow), Building 4. Upon completion, it will comprise approximately 180 flats and will accommodate 500 people. Upon full completion, the residential project will consist of four buildings, comprising approximately 700 flats and accommodating 2,000 people.

Pavel Poselenov, CEO of PIK Group comments:

"We are working hard for our customers and we are pleased to have secured the expansion of our mortgage programs with Gazprombank. We see room for further improvements in mortgage accessibility as the economy recovers and commercial banks' perceptions of property developers improve. Looking ahead we see the possibility of further increased cooperation with lenders."

Enquiries:

Investors

PIK Group Tel: +7 495 505 97 33 ext. 1315/1358

Viktor Szalkay

Head of Investor Relations

International media

Citigate Dewe Rogerson Tel: +44 20 7638 9571

Tom Baldock

Lindsay Noton

Russian media

Dmitry Ivliev Tel: +7 495 505 97 33 ext. 1010/1028