Russia’s largest bank Sberbank has launched a subsidiary in the Middle East and gained in-principle approval to open an office in the United Arab Emirates.

Before the end of the year, Sberinvest Middle East Limited expects to obtain its final authorisation from regulator Abu Dhabi Global Market (ADGM) that will allow it to open an office in Abu Dhabi.

Sberinvest Middle East is a subsidiary of Sberbank Investments LLC, part of Sberbank’s corporate and investment business unit.

Andrei Ugarov has been appointed as the CEO of Sberinvest Middle East. Before joining Sberbank in April, Ugarov was a partner at PwC for seven years, focused on mergers and acquisitions and corporate finance in West Africa.

Chief Islamic finance officer of the new unit is Behnam Gurbanzada. Gurbanzada joined Sberbank in 2016, establishing its Islamic finance business in Russia, which he currently heads up. He previously also held Islamic banking roles at the International Bank of Azerbaijan.

The new entity will help the bank continue its strategy of strengthening ties between Russia and the Middle East, with the primary objective of Sberinvest Middle East to become a key partner in investment deals between Russia and the Middle East, reveals a statement by Sberbank.

Sberinvest Middle East is set to have an Islamic banking license, which will allow the structuring of investment products in accordance with shariah principles.

The unit also plans to engage in the trade finance of Russian exports to Middle Eastern countries, as well as promote the services of Sberbank companies in these countries, says the bank.

Oleg Ganeev, deputy chairman of the executive board of Sberbank and chairman of the board of Sberinvest Middle East, says: “A physical presence in the region will position us to directly promote partnerships with Middle Eastern investors for their projects in Russia, as well as the export of Russian products to the Middle Eastern countries. We also have big plans to export Russian food products to the Gulf states and to develop traditional Islamic finance products through the expertise of the Sberinvest Middle East team.”