Exigency for Sukuk Bonds Financing: Issues and Discussions

24 Pages Posted: 28 Aug 2010

See all articles by Shamsher Mohamad

Shamsher Mohamad

University Putra Malaysia - Graduate School of Management

Taufiq Hassan Shah

University Putra Malaysia - Faculty of Economics and Management

Dr. Adesina-Uthman

National Open University of Nigeria; University Putra Malaysia

Date Written: August 26, 2010

Abstract

This paper is an attempt to examine a growing interest in Islamic financial instruments with a special focus on Sukuk- the Islamic bond financing. It traces the history of Islamic Financial system, the emergence and global explosion in Islamic banking and finance and the exigency for Sukuk by different countries as an alternative to conventional bonds in diversifying risk especially countries from the Middle East who are usually over-exposed to dollar assets. Employing secondary data, this paper enunciate current and future challenges to Sukuk issuers most importantly in the West. After the introduction, section one is dedicated to a brief discussion on the history of Islamic Banking and Finance in the world in general and Malaysia in particular. Section two x-tray the global explosion for Islamic financial instrument as well as exigencies for Sukuk Bonds by different countries as an alternative to conventional bonds in diversifying risk, further issues and discussion on the subject across the globe were deeply delve into in section three. The article closes by enunciate current and future challenges facing the issuers and holders of Sukuk bonds most importantly in the West; especially in attaining the Maqasid Al-Shari’ah (the objectives of Shari’ah) followed by conclusion and recommendations in section four.

Keywords: Sovereign Sukuk, Bonds, Shari’ah, Islamic Financial System, ethical financing

JEL Classification: G12, G32

Suggested Citation

Mohamad, Shamsher and Shah, Taufiq Hassan and Adesina-Uthman, Dr. Ganiyat Adejoke, Exigency for Sukuk Bonds Financing: Issues and Discussions (August 26, 2010). Available at SSRN: https://ssrn.com/abstract=1666103 or http://dx.doi.org/10.2139/ssrn.1666103

Shamsher Mohamad

University Putra Malaysia - Graduate School of Management ( email )

Selangor Darul Ehsan
Serdang, Selangor 43400
Malaysia

Taufiq Hassan Shah

University Putra Malaysia - Faculty of Economics and Management ( email )

Serdang, Selangor 43400
Malaysia

Dr. Ganiyat Adejoke Adesina-Uthman (Contact Author)

National Open University of Nigeria ( email )

14/16 Ahmadu Bello Way
Victoria Island Lagos
Lagos Island, LA
Nigeria

University Putra Malaysia ( email )

Serdang, Selangor 43400
Malaysia

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