Willing Banks Find Profits in Legal Trade With Iran
Updated April 8, 2012 1:42 p.m. ET
As Western sanctions on Iran have grown tighter, some small banks have found a lucrative niche financing what remains of the legal trade with the Islamic Republic.
Top-tier financial institutions including Socit Gnrale SA and Rabobank Group have stepped back from business with Iran in recent months, citing increased political risk and logistical hassles that attend even legal trade with the country.
As a result, the remaining players are commanding higher fees and offering increasingly complicated services. Like
Russia's First Czech-Russian Bank LLC and China's Bank of Kunlun Co. Ltd, they are typically small, obscure financial institutions often based in countries historically friendly to Iran.
While relatively small, the markets are large enough to attract smaller institutions. In February, some traders started flocking to First Czech-Russian Bank after word spread that it had started servicing Iran trade facilities, according to Iran trade professionals. In March,
Roman Popov, the chairman and majority owner of the bank,
was elected to lead the Russian-Iranian Business Council, promising to increase bilateral trade.
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