Sheikh Zayed Grand Mosque, Abu Dhabi, UAE (early morning)
Thoughts from Iraj Toutounchian’s Islamic Money & Banking, Integrating Money in Capital Theory
The Institute of Islamic Banking and Insurance (IIBI) defines Sukuk contracts as having ‘similar characteristics to that of a conventional bond with the key difference being that they are asset backed; Sukuk represent proportionate beneficial ownership in the underlying asset. The asset will be leased to the client to yield the return on the Sukuk.
The Sukuk has attracted considerable attention in recent years from Muslims and non-Muslims alike. It is categorized as the ‘Islamic equivalent of a bond’ in Wikipedia (as up-to-date and reliable a source as any in the fast-growing area), which also provides the following information on the workings of Sukuk:
The essence of Sukuk, in the modern Islamic perspective, lies in the concept of asset monetization – the so-called securitization – that is…
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