By Andrei Skvarsky.
Russian companies seeking to do business in Middle Eastern countries and Egyptian firms wishing to work in Russia will receive “extremely extensive” financial support from Banque Misr, a top Egyptian lender that has just opened a representative office in Moscow, the bank’s chairman has said.
Russian law prohibits foreign banks from having branches in Russia. All that foreign lenders are allowed to do is to open representative offices, which are chiefly missions handling formalities, to set up subsidiaries that have to be Russian legal entities, or to own shares in Russia-based companies.
“So far we just have a representative office, and its tasks differ from those of a full-scale bank branch,” Mohamed Mahmoud Ahmed Eletreby, chairman of Banque Misr, which is Egypt’s second-largest state bank, told EmergingMarkets.me.
But the office will still help to boost business ties between Russia and the Middle East, according to Eletreby.
“Our bank is widely represented [abroad], primarily in Middle Eastern countries, and so Russian businesspeople and companies that are interested in doing business in that region will receive extremely extensive financial and banking support from us,” Eletreby said, speaking in Arabic through an interpreter, who was translating his words into Russian.
The Moscow office will help Russian companies that are “interested in investing abroad, primarily in Middle Eastern countries, and specifically in Egypt”, he said.
“We have several branches in Middle Eastern countries, the majority of them in Gulf countries, primarily in the United Arab Emirates, and via them we would be able to provide Russian enterprises with an extremely wide range of banking services,” Eletreby said.
The Moscow office, situated on the 25th floor of a tower block on a prestigious business compound called Moscow City, would also help Egyptian companies wishing to work in Russia to receive “the full range of banking and financial services,” Eletreby said.
The office would, in addition, provide “coordination between legal entities in Russia and Egypt,” he said.
Whether Banque Misr, which has become the first Egyptian bank with direct presence in Russia, will open representative offices in other Russian cities depends on the performance of the Moscow office, Eletreby said.
Asked about the stance of Banque Misr, which is 100-per-cent state-owned and, in Eletreby’s words, is “in a sense the right hand of the Egyptian Finance Ministry”, on cryptocurrencies, today’s in-thing, Eletreby denied that the bank uses any virtual money in its operations.
“At the moment we don’t use any cryptocurrencies. In any case, if any such need arises, it is primarily the Egyptian central bank that would have to deal with the matter. At the moment, no such possibility is under consideration,” he said.