Russian bank awarded Islamic funding

Russian bank awarded Islamic funding

Russia’s Ak Bars Bank has brought in commercial and multilateral lenders to close a US$60mn syndicated Islamic financing.

Citi and the Islamic Corporation for the Development of the Private Sector both acted as lead arrangers and bookrunners on the deal, while the Eurasian Development Bank joined as a mandated lead arranger.

The one-year murabaha facility will be used for Ak Bars’ shariah-compliant financing activities mainly in Tatarstan, East Russia.

“The transaction has attracted substantial interest among investors in the Middle East and raised awareness of the Islamic investment community of Russia and specifically Tatarstan,” says Ak Bars in a statement.

The bank’s chief executive officer Robert Minnegaliev adds: “We are very thankful to all the participants of the murabaha project that is truly important for Ak Bars Bank, the republic of Tatarstan and the Russian banking sector.

“We highly appreciate the trust which has been shown to the bank from the international financial institutions and we are confident that this transaction will be a key milestone in strengthening of the cooperation between Russian banks and banks in the Middle East and Asia.

“This agreement is one of the steps in the development of Islamic finance in Russia and we plan to allocate raised funds to develop shariah-compliant financial services.”