File Photo: Farmers harvest wheat on Qalyub farm in the El-Kalubia governorate, northeast of Cairo, Egypt May 1, 2016 (Photo: Reuters)
Russia’s Sberbank has structured its first trade finance deal with an Islamic bank to supply Russian wheat to Egypt, the largest Russian bank said in a statement on Wednesday.
The deal with Saudi Arabia’s International Islamic Trade Finance Corporation (ITFC) was implemented through Sberbank’s subsidiary in Switzerland, the statement added.
"Under the deal, we have structured an export letter of credit to supply Russian wheat to Egypt,” said Oleg Ganeev, Sberbank’s deputy chairman of executive board.
Egypt is the world’s largest wheat importer and the top buyer of Russian wheat.
Egypt’s state-run General Authority for Supply Commodities (GASC), a long-term customer of the bank and a major trader of agricultural products, acted as the buyer in the deal.
“Islamic finance is a relatively new business area for Sberbank,” Ganeev said, adding that he expects the deal “will unlock new opportunities to develop this business area for our customers”.
The Russian bank said ITFC will enable it to significantly increase its share in Russian wheat exports to Egypt.