Dec 14 Russia and Iran are exploring the
establishment of an Islamic bank as the two countries expand
their economic cooperation, the TASS news agency cited Russian
Energy Minister Alexander Novak as saying.
The entire banking system in Iran must abide by Islamic
principles such as a ban on interest and gambling, which foreign
firms would need to follow if they are to grab business ranging
from long-term financing to insurance.
"The creation of a Russian-Iranian Islamic bank was
discussed. Our banks are exploring the mechanism, the related
decision has not been made yet," Novak said at a bilateral
meeting held in Tehran.
No timeframe or potential size was given for the proposed
bank, which would be the first such institution operating in the
State-linked Russian lenders Vnesheconombank,
Sberbank and Tatfondbank have been
developing Islamic financial products of their own over the past
Iran is keen to diversify funding options for its companies.
At present, most financing in Iran is sourced from domestic
lenders with only a small portion sourced from foreign sources
and the debt capital markets.
(Reporting by Bernardo Vizcaino; Editing by Eric Meijer)