Sberbank of Russia is exploring the possibility of executing Islamic banking projects in a number of Russian regions, and also in Kazakhstan and Turkey, a deputy management board chairman Oleg Ganeev told RIA Novosti.
Islamic banking, or partner banking, is an alternative type of financial services that meets funding principles which are widely applied in Southeast Asia and the Middle East. The main peculiarity of financial services in partner banking is the refusal of loan interest, high-risk operations and uncertain transactions.
The largest Russian bank sees demand for Islamic banking products on the part of retail and corporate customers, he said.
"Deposit products, settlement and check accounts are now in demand. Corporate customers are interested in products designed to fund working capital, trade finance, and also project finance for SMEs," the Sberbank executive said.
In January, Sberbank executed a pilot Islamic finance deal with a leasing firm from Tatarstan, Ganeev noted. According to him, the bank intends to expand this practice in a number of regions and countries in which the biggest Russian bank operates.
"In the first place, we mull executing projects of this kind in the Republic of Bashkortostan and the Republic of Chechnya. Furthermore, the bank holds a stake in Denizbank (in Turkey – editorial note) and in a subsidiary bank in Kazakhstan," Ganeev said.
