Skip to Main Content
Fundamentals of Islamic Money and Capital Markets
book

Fundamentals of Islamic Money and Capital Markets

by Azmi Omar, Muhamad Abduh, Raditya Sukmana
April 2013
Beginner content levelBeginner
256 pages
7h 6m
English
Wiley
Content preview from Fundamentals of Islamic Money and Capital Markets

Chapter 5

An Overview of Sukuk

Learning outcomes

At the end of this chapter, you should be able to:

1 Differentiate between sukuk, bonds, and shares.

2 Identify basic contracts in sukuk structures.

3 Distinguish between the various sukuk structures.

4 Differentiate between asset-based and asset-backed sukuk.

Introduction

Nowadays, the term sukuk is more widely known than it was a decade ago. Sukuk is a claim or claims that are similar to notes or certificates, such as a trust certificate.1 The Accounting and Auditing Organization for Islamic Finance (AAOIFI) defines investment sukuk as certificates of equal value representing undivided shares in ownership of tangible assets, usufruct, and services, or in the ownership of the assets of particular projects or special investment activities; however, this is true after the receipt of the value of the sukuk, the closing of the subscription, and employment of the funds received for the purpose for which the sukuk were issued. Meanwhile, the Securities Commission (SC) of Malaysia defines sukuk as certificates of equal value that represent undivided ownership or investment in the assets using Shariah principles and concepts approved by the SAC. However, unlike the conventional claim, sukuk is an ownership claim and therefore not a debt of the issuer, but rather an undivided ownership share in specific assets/projects/services.

“Sukuk” is derived from the word sakk, or which can mean legal instrument, deed, and cheque. In lisan al-Arab ...

Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Start your free trial

You might also like

Islamic Capital Markets and Products

Islamic Capital Markets and Products

Simon Archer, Rifaat Ahmed Abdel Karim
Sukuk Securities: New Ways of Debt Contracting

Sukuk Securities: New Ways of Debt Contracting

Meysam Safari, Mohamed Ariff, Shamsher Mohamad

Publisher Resources

ISBN: 9781118504024Purchase bookDownloads