Sukuk Structures 26 January 2017
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The Development of the Global Sukuk Market from an Indexing Perspective
Index Education The Development of the Global Sukuk Market from an Indexing Perspective The global sukuk market has enjoyed tremendous growth since 2013. As Contributor measured by the Dow Jones Sukuk Total Return Index and the S&P Global Jason Giordano High Yield Sukuk Index, the U.S. dollar-denominated sukuk market Director experienced a compound annualized growth rate of nearly 18%, driven by Fixed Income Product increased issuance from sovereigns and supranationals, as well as strong Management investor demand for Shariah-compliant securities. Historically, the majority [email protected] of issuance has come from Saudi Arabia and Malaysia; however, the past three years have witnessed an increasing number of issuers from new markets, as well as a deeper and broader investor base. Exhibit 1: Growth of the Global Sukuk Market 100 90 80 70 60 USD Billions USD 50 40 30 20 October 2013 October 2014 October 2015 October 2016 October 2017 October 2018 October 2019 October Dow Jones Sukuk Index (Investment Grade) S&P Global High Yield Sukuk Index Source: S&P Dow Jones Indices LLC. Data as of October 2019. Past performance is no guarantee of future results. Chart is provided for illustrative purposes and reflects hypothetical historical performance. Please see the Performance Disclosure at the end of this document for more information regarding the inherent limitations associated with back-tested performance. This article was first published in Islamic Finance news Investors Report 2020. Register to receive our latest research, education, and commentary at on.spdji.com/SignUp. The Development of the Global Sukuk Market from an Indexing Perspective February 2020 The recent growth of the global sukuk market is likely to accelerate, as GCC issuers are poised to refinance in order to fund increasing deficits and The global sukuk as new entrants continue to come to market. -
(Ḥiyal) and Usury in Islamic Commercial Law
LEGAL STRATAGEMS (ḤIYAL) AND USURY IN ISLAMIC COMMERCIAL LAW by MUHAMMED IMRAN ISMAIL A thesis submitted to The University of Birmingham for the degree of DOCTOR OF PHILOSOPHY Department of Theology and Religion College of Arts and Law The University of Birmingham May 2010 ABSTRACT This thesis investigates the subject of legal stratagems (ḥiyal) in Islamic jurisprudence, in general and more particularly the ḥiyal used to evade the usury (ribā) prohibition. The context of this thesis is the nascent Islamic finance industry in which these ḥiyal play a leading role. The ḥiyal have been appropriated from the classical Islamic legal corpus without appreciating their historical contextual framework. This thesis seeks to explicate that framework and clarify the purpose and role of those ḥiyal as envisaged in the discourse of the classical Islamic jurists. The ḥiyal are shown to be premised upon a teleology which demarcates them as normative exits, makhārij. The makhārij are conditioned by the systematic reasoning of the Ḥanafī jurists, which both justifies their utility and provides their juridical remit. The ḥiyal of ribā are demonstrated to have been utilised primarily as substitutes for philanthropy, and not in the commercial sector. The commercial sector relied on the Islamic prescriptions for equity investment partnerships which precluded the need for interest based loans. Although the jurists sanctioned the ḥiyal of ribā for the poor, they did so at the expense of systematic consistency. This meant that these ḥiyal, as opposed to the makhārij, are not regarded as normative exits, but rather, as transitory concessions. The use of these ḥiyal as financial norms is therefore unwarranted. -
New Model of Salam Sale for Agricultural Development Finance
Research Article New Model of Salam sale for Agricultural Archives of Development Finance Al Siddig Talha M Rahma* Agriculture Imam Mohammed Ibn Saud Islamic University, College of Economics &Business administration, Kingdom of Saudi Arabia Research and Abstract Technology (AART) The new financial economic model derived from the traditional Salam situation. This scenario is based on the idea behind the treatment of risks facing traditional Salam applications, which includes high rates of inflation and the exit of financing from its approved aspects, which cannot enable the farmer or producer to disburse this monetary benefit in the Volume 1 Issue 3, 2020 fields of agriculture. Then Banks and financial institutions lose huge amounts of money that are wasted. In addition, lack of understanding of the process of obtaining loans between farmers and producers, this new model can solve many problems Article Information and risks in the classic sales of Salam, which rely mainly on granting cash loans. Received date: May 28, 2020 Published date: July 07, 2020 The paper works to monitor and limit the risks posed by the traditional Salam and pushes that agricultural financing loses. It is most important input to financing and then corrects the paper and it relies on this innovative model, which aims to provide the necessary inputs to farmers and producers. This paper attempts to solve this problem by providing inputs directly *Corresponding author by updating production through regular and timely operation of modern scientific inputs. Al Siddig Talha M Rahma, Imam Mohammed Ibn Saud Islamic University, The study identified the structural equation model to analyze the results of the analysis of descriptive statistical data, College of Economics & Business which resulted in the preferred cash financing for farmers as a desirable situation. -
Abdul Azim Islahi Islamic Economics Research Center King Abdulaziz University, Jeddah, Saudi Arabia
J.KAU: Islamic Econ., Vol. 23 No. 2, pp: 237-246 (2010 A.D./1431 A.H.) Muhammad Nejatullah Siddiqi Maqasid-e Shari`at (Objectives of the Shariah) Markazi Maktabah-e-Islami, New Delhi. 2009, 322 pp. Review by: Abdul Azim Islahi Islamic Economics Research Center King Abdulaziz University, Jeddah, Saudi Arabia “Maqasid-e-Shariat” (Objectives of the Shariah) is the latest work by Prof. M.N. Siddiqi, first published by the Islamic Research Academy, Islamabad, and republished by the Markazi Maktabah-e-Islami, New Delhi. We have before us the one published from New Delhi. The subject of Objectives of Shariah has assumed utmost importance these days in the wake of numerous new issues faced by the Ummah in recent years. The Urdu language is spoken by a very large number of Muslim population and scholars in the world. But writings on this topic are very few in this Islamically rich language. Prof. Siddiqi seeks to fill this gap and wants to address those who master only this language. Since long time Dr. Siddiqi held that “envisioning Islamic economy in twenty-first century is better done with reference to goals of Islamic law. This will enable us to handle issues like poverty and inequality (observed in his Keynote Address on Islamic Economics: Current State of Knowledge and Development of the Discipline" delivered at the Round Table Discussion – Organized by IRTI during 26-27 May, 2004, Jeddah). He is of the view that there is need to differentiate between objectives of Islam as a way of life and objectives of Islamic jurisprudence. -
Fiqh Muamalat Part I
Faculty of Syariah and Law University Sains Islam Malaysia 1 Content (Part I) n The Basis of Fiqh Muamalat n Blameworthy: n Riba n Gharar n Maisir n Praiseworthy n Risk n Ethics n Umar b. al-Khattab said, "There are three things. If Allah's Messenger had explained them clearly, it would have been dearer to me than the world and what it contains: (These are) kalala, riba, and khilafa. [Sunan Ibn Majah] The Fall of the Ottoman Empire n Ottoman Empire : 1299-1922 n High Interest Loan with British and France 1854: £3M interest 6%, n 1855, £5M interest 4%, n 1858, £5M interest 6% and £8M interest 6%. Riba n First: In Mecca Quran Al Rum 30: 39 Riba deprived wealth of Allah’s blessing, charity raised it manifoldly n Second: In Medina 1st H Quran Al Nisa: 161:Severely disapproved or riba n Third: 2nd H. Al Imran: 130-131. Enjoining muslim to keep away from riba. n Final: 9 days before the demise of the prophet. 2: 275-281. n The Noble Qur'an - Al-Baqarah 275-281 n 275. Those who eat Ribâ (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitân (Satan) leading him to insanity. That is because they say: "Trading is only like Ribâ (usury)," whereas Allâh has permitted trading and forbidden Ribâ (usury). So whosoever receives an admonition from his Lord and stops eating Ribâ (usury) shall not be punished for the past; his case is for Allâh (to judge); but whoever returns [to Ribâ (usury)], such are the dwellers of the Fire - they will abide therein. -
Qardhul Hasan Principles Applied to Micro Finance Facilities Paper to Be
Research Center for Islamic Economics and Finance Universiti Kebangsaan Malaysia Bangi 43600, Selangor, Malaysia Fax: +603-89215789 http://www.ekonis-ukm.my E-mail: [email protected] Working Paper in Islamic Economics and Finance No. 1021 Qardhul Hasan Principles Applied to Micro Finance Facilities Abdul Ghafar Ismail1 Bayu Taufiq Possumah2 Research Center for Islamic Economics and Finance School of Economics Universiti Kebangsaan Malaysia Bangi, 43600 Selangor D.E., Malaysia Fax: +603-8921 5789 e-mail: [email protected] Paper to be presented at The 2nd International Workshop in Islamic Economics Theory: Islamic Micro-finance Towards Global Poverty Alleviation and Sustainable Development, 8-9 December 2010, Bangi Abstract During the last ten years, several developing Muslim countries experienced an interesting phenomenon. Where they are able to build his country's economy through the economic empowerment of small communities. The role of microfinance institutions cannot be denied. Through microfinance programs, the country can further improve the welfare of the poor and reducing poverty. Accordingly, Muslim countries have to combat it by using religious institution and culture. In this case, the role of Qardh al Hasan, as traditional Islamic financing in tackling of poverty is very relevant and important. Qardh al Hasan is supposed to be an important to investigate and provide much needed social service to the poor effectively. The Qardh al-hasan is one of financing-product provided by microfinance institutions. Unlike other financing products, the qardhul-hasan has some unique characteristics, including to entertaint a very specific customers who might be categorized as the dhuafa’ group. The purpose of this paper is to show how microfinance programmes based on Qardh al Hasan financing principles can be established. -
The Law of Islamic Finance in the United Kingdom: Legal Pluralism and Financial Competition
Ercanbrack, Jonathan G (2011) The Law of Islamic Finance in the United Kingdom: Legal Pluralism and Financial Competition . PhD Thesis, SOAS (School of Oriental and African Studies) http://eprints.soas.ac.uk/13598 Copyright © and Moral Rights for this thesis are retained by the author and/or other copyright owners. A copy can be downloaded for personal non-commercial research or study, without prior permission or charge. This thesis cannot be reproduced or quoted extensively from without first obtaining permission in writing from the copyright holder/s. The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the copyright holders. When referring to this thesis, full bibliographic details including the author, title, awarding institution and date of the thesis must be given e.g. AUTHOR (year of submission) "Full thesis title", name of the School or Department, PhD Thesis, pagination. THE LAW OF ISLAMIC FINANCE IN THE UNITED KINGDOM: LEGAL PLURALISM AND FINANCIAL COMPETITION BY JONATHAN G. ERCANBRACK SCHOOL OF LAW SCHOOL OF ORIENTAL AND AFRICAN STUDIES (SOAS) UNIVERSITY OF LONDON THESIS SUBMITTED FOR THE PHD IN LAW 15 SEPTEMBER 2011 1 DECLARATION FOR PHD THESIS I have read and understood regulation 17.9 of the Regulations for students of the School of Oriental and African Studies concerning plagiarism. I undertake that all the material presented for examination is my own work and has not been written for me, in whole or in part by any other person. I also undertake that any quotation or paraphrase from the published or unpublished work of another person has been duly acknowledged in the work which I present for examination. -
Tabarru' and Takaful
CHAPTER 18 Tabarru’ and takaful 18.1 Introduction Takaful is structured around the concept of donation – an exchange contract, aims at making profit out of the the cornerstone of charity and philanthropy. However, it insurance operations. In such a contract, gharar is pro- is a special kind of charity that makes the donor a poten- hibited because it may give rise to a potential dispute. A tial beneficiary of the donation itself, as is the case with person who pays the premium (insurance price) pursu- takaful. Therefore, it is interesting to study this phenom- ant to an insurance policy actually does so in exchange enon in order to determine consequences and implica- for ‘peace of mind.’ In return for the premium, the in- tions for using it as a tool for organized charity and its surer indemnifies the insured should any mishap occur management for the benefit of targeted social groups. during the insurance period. As uncertainty is an integral part of the incidence of claim against a definite payment Takaful is based on the principles of mutual coopera- of premium, the conventional insurance contract is tion and donation (tabarru`). These principles can be deemed unacceptable from a Shari’a viewpoint. used to develop Islamic banking and finance as a socially responsible model and a tool for community develop- On the other hand, takaful, represents a reciprocal rela- ment. The actual practice of takaful, however, aligns tionship and agreement of mutual help between partici- itself more with the profit-motive than social respon- pating members who undertake to mutually guarantee sibility and community development. -
Emerging Trends in Sukuk Offerings
Chicago Journal of International Law Volume 7 Number 2 Article 5 1-1-2007 New Horizons for Islamic Securities: Emerging Trends in Sukuk Offerings Ayman H. Abdel-Khaleq Christopher F. Richardson Follow this and additional works at: https://chicagounbound.uchicago.edu/cjil Recommended Citation Abdel-Khaleq, Ayman H. and Richardson, Christopher F. (2007) "New Horizons for Islamic Securities: Emerging Trends in Sukuk Offerings," Chicago Journal of International Law: Vol. 7: No. 2, Article 5. Available at: https://chicagounbound.uchicago.edu/cjil/vol7/iss2/5 This Article is brought to you for free and open access by Chicago Unbound. It has been accepted for inclusion in Chicago Journal of International Law by an authorized editor of Chicago Unbound. For more information, please contact [email protected]. New Horizons for Islamic Securities: Emerging Trends in Sukuk Offerings Ayman H. Abdel-Khaleq* and Christopher F. Richardson** I. INTRODUCTION Shari'ah-compliant finance and investment products are fast becoming part of the mainstream of the world economy as Muslim money is increasingly integrated into global capital markets and, generally, the commercial finance system. Once largely restricted to the Middle East and Southeast Asia, Islamic finance and investment now permeate markets throughout Europe, Asia, and even the US. As a number of countries in the Islamic world, emboldened by sustained increases in commodity prices and higher levels of foreign direct investment, look beyond traditional borders for investment opportunities, new forms of Islamic finance and investment have emerged. Perhaps the most significant recent development has been the emergence of sukuk (which roughly translates to "certificates")-in essence an asset-backed security structured in compliance with the precepts of Shari'ah, somewhat similar to a trust certificate or bond. -
The Uses and Misuses of Commodity Murabaha: Islamic Economic Perspective
MPRA Munich Personal RePEc Archive The Uses and Misuses of Commodity Murabaha: Islamic Economic Perspective Nidal Alsayyed The Global University In Islamic Finance (INCEIF)- Malaysia 10. January 2010 Online at http://mpra.ub.uni-muenchen.de/20262/ MPRA Paper No. 20262, posted 27. January 2010 07:11 UTC THE GLOBAL UNIVERSITY IN ISLAMIC FINANCE (INCEIF) The Uses and Misuses of Commodity Murabaha: Islamic Economic Perspective NIDAL A ALSAYYED PhD Researcher Islamic Economics, Banking, and Finance http://groups.google.com/group/nidal_islamic-finance January, 2010 Commodity Murabaha: Uses and Misuses 2009 The Uses and Misuses of Commodity Murabaha: Islamic Economic Perspective INCEIF: The Global University in Islamic Finance, Kuala Lumpur E-mail: [email protected] Telephone: + 6017 2559 700 (HP) Profile: NIDAL ALSAYYED (http://ideas.repec.org/f/pal399.html) --------------------------------------------------------------------------------------------------------------------- ABSTRACT Some exciting Economical developments have taken place in the area of Islamic finance during the preceding two years. There has been a fast expansion in its market share, diversification of products picked up pace and the rapid globalization of the services ensures their future expansion. Commodity murabahah is one of the most commonly used financing contracts in Islamic banking. But of no less consequence may prove, the lurch one finds commodity murabahah in at the close of 2008 (Hasan 2009)1. Commodity Murabaha is clearly the Islamic treasurer’s funding product of choice, as it is flexible enough to facilitate many structures for financing, hedging, and currency exchanging. It is time to apply the shari'ah objective of “sa’dd-aldharai” that closes the potential avenues for outwitting the shari’ah objectives and spirit . -
The Nature of Riba in Islam
THE NATURE OF RIBA IN ISLAM By: M. Umer Chapra1 Abstrak Perdebatan masalah riba seperti tidak pernah selesai di diskusikan oleh banyak kalangan, baik akademis, organisasi keagamaan, bahkan sampai pada forum-forum intenasional. Beberapa terminologi dibahas dengan baik dalam tulisan ini yang dimulai dengan pelarangan riba itu sendiri kemudian pembagian-pembagian riba, diantaranya riba al-Nasi’ah dan riba al-Fadl, serta implikasi dari dua bentuk riba tersebut. Pembahasan didukung dengan pendapat-pendapat para ulama dan ekonom yang merujuk langsung dari ayat-ayat al-Qur’an, sampai pada perdebatan hukum. Demikian juga al-Qur’an sangat jelas membedakan antara riba dan perdagangan, namun pelarangan riba sangat jelas bahkan diperkuat dengan hadits-hadits yang dengan eksplisit melarang riba. Dijelaskan pula tentang perbedaan antara riba dan bunga bank. Islam sangat menentang bunga bank karena Islam berharap terjadinya sistem ekonomi yang mengeliminasi seluruh bentuk ketidakadilan dengan memperkenalkan keadilan antara pengusaha dan pemilik modal, yaitu berbagi resiko dan berbagi hasil. ŭ ΊņĨŧ Ώ 1 ΎỲŏΉė ΞΊẂ ĤΣΔĜŧ ΔΩė ĥ ĜẃΐĨľė Έ΅ Ή ģŊΜūΕ╬ė ĥ ĜΡĜỳΉė ΎΙā ŋķā ĤΡŊĜųĨ⅝Ϋė – ĤΣẂĜΐĨį Ϋė ĤΉėŋẃΉė ŋẃħ ĥ ĜẃΐĨĴ ΐΊΉ ĤĢŧ ΕΉĜġΛ .ĤΡĜỳΉė ΖōΙ ⅜Σ⅞ĸĨΉ ĤẃĢĨ╬ė ĥ ĜΣĴ ΣħėŏĨŦΫė ∟ ĥ ĜẃΐĨľė Ίħ ╚ġ ‛ άĨŅė ŊΜį Λ ΒΏ ĤΣĴ ΣħėŏĨŦΫė Ίħ ŏŲĜΕẂ ŋķā ΞΊẂ ⅜₤ėΜħ Ĥ╤ ªΌάŦΩėΛ ĤΣΔėŏųΕΉėΛ ĤΡŊΜΚΣΉėΛ ĤΣŦΛŋΕ▀ė ŭ ŅΧė ΞΊẂΛ ªĤΣΕΡŋΉė Η╠ė ŋ⅝ ⌠ΛΧė ĤīάĬΉė ĥ ĜΔĜΡŋΉė ẀĜĢħā ΒΏ ♥ė╙Ģ΄ ♥ĜĢΔĜį ΑĜ΄ ėŌċΛ .ŊΜ⅞ΕΉė Ŵėŏ⅝ċ ΒẂ ĤΊųĸĨ╬ė ģŋĕĜ℮Ήė ┐ŏ╡ ΜΙΛ ĜΏ ΑĈġ ĤΉŊĜľė ΑΜΉΛĜ► ΝŏŅΧė ĥ ĜΔĜΡŋΉė ẀĜĢħĈġ ΠŦĈĨΉė ∟ ╚ĢỲėŏΉė ╚ΐΊŧ ╬ė -
Sukuk in Focus the Necessity for Global Common Practices Deloitte Islamic Finance Insights Series Leading by Engaging
Sukuk in focus The necessity for global common practices Deloitte Islamic Finance Insights Series Leading by engaging Sukuk in focus | The necessity for global common practices Contents 04 05 06 07 Foreword from Deloitte Foreword from ISRA Acknowledgments Executive summary 09 10 12 17 Introduction: Strategic Shariah governance and Practice and market Regulatory capabilities and practice approach sustainability institutions market development 40 41 Sustainability in focus Thinking further ahead: Practice and policy considerations 03 Sukuk in focus | The necessity for global common practices Foreword from Deloitte Dear Islamic finance practitioners, For Islamic finance practitioners, this will require re-thinking and re-modelling of For nearly two decades, many financial their governance frameworks and regulators and investment institutions business operating channels. Most around the world have been committed importantly, practitioners need to harness to strengthening practices in Islamic their Islamic finance corporate culture capital markets, and leverage standards and embrace a ‘back to basics’ approach for Sukuk as a key investment asset class. and adhere to designing products and Embedded within this has been an services in line with the ‘equity-base’ equally strong commitment from industry differentiator to fund real economy standards setters and other business projects. supporting institutions (BSIs) to address practice differences and inconsistency. Clearly, this can be streamlined in the first place, with Maqasid Al Shariah, which It is with great pleasure that we produce reflects values and practices of social and Dr. Hatim El Tahir, FCISI this report, and put forward our thoughts economic inclusion and sustainable Director, Islamic Finance Group on a number of business practices community development.