Credit Europe Bank gave individual clients access to operations with dirham

Another Russian bank, Credit Europe Bank, announced the start of providing individual clients with access to transactions with the dirham. Unlike the Chinese yuan, the UAE currency is not yet particularly popular: only a few banks offer retail products in it selectively. Experts are sure that the reason is the lack of profitable assets to place dirhams attracted from citizens.

Credit Europe Bank announced the launch of operations in UAE dirhams for individual clients. They have access to opening a current account, placing a deposit, currency exchange operations and interbank transfers in UAE dirhams. The maximum rate on deposits is 3%.

At the moment, only two players offer dirham deposits – Sberbank and MTS-Bank. Sberbank has a maximum yield on deposits in the UAE currency of 3% (excluding capitalization). The bank launched dirham deposits at the end of May (see “Kommersant” dated May 25). “Clients have the opportunity to open time deposits in UAE dirhams, savings accounts, as well as buying and selling cash currency,” the press service of Sberbank explained. “At the same time, term deposits are of the greatest interest to customers.” MTS-Bank was the first to launch deposits in dirhams, in December 2022 (maximum yield of 2% per annum). The bank did not respond to Kommersant’s request.

Other major banks either do not plan to launch deposits in UAE dirhams yet, or prefer to refrain from commenting. “Now the main demand, in addition to rubles, is presented by customers for yuan. Interest in other soft currencies is spotty, – the VTB press service explained. – The expansion of the offer on the market with products in dirhams is more of a marketing nature. Accumulating unused liabilities is a direct loss.” “The number of banks offering deposits in UAE dirhams is very small,” concludes Natalia Bogomolova, NRA bank ratings analyst. “Most likely, these are banks that work directly with importers and exporters from the UAE and are settled in the national currency.”

Transfers in dirhams, unlike conversion operations, are still exotic, according to Kommersant’s interlocutors from among bankers, this option is offered mainly by small players who have established correspondent relations with partners from the UAE. An example is the small bank “Slavia”, it was not possible to get comments from Kommersant there.

According to independent expert Andrei Barkhota, the unpopularity of the retail dirham is due to the difficulty of converting it into loans and the rather high costs of generating non-credit assets in the UAE currency.

There are no classical currency trading in dirhams on the domestic market of the Russian Federation. In April, Moscow Exchange launched trading in settled (that is, non-deliverable) futures contracts for the dirham/ruble pair. But this tool is for hedging the corresponding currency risks, and not the profitable placement of dirhams, says Yury Belikov, managing director for validation of the Expert RA rating agency. Full-fledged auctions are still only planned.

But the dirham has prospects. Thus, according to the Central Bank, the total volume of transactions with the dirham in May of this year amounted to a maximum of $3.3 billion. Due to the obvious narrowing of the range of available currencies, the dirham remains one of the options for utilizing limits on foreign exchange assets, Andrei Barkhota notes. For banks, this is an opportunity to diversify the funding structure, one of the reasons for the emergence of new proposals in soft currencies is the closure of a currency position due to a significant amount of assets in dollars and euros, agrees Yegor Lopatin, deputy director of the financial institutions rating group of the NKR agency. And for financial transactions of Russian citizens who relocated to the UAE, banks can organize a special conversion channel, Andrey Barkhota suggests.

Ksenia Dementieva, Yulia Poslavskaya