Structural development of Ijarah Sukuk: an appraisal

Sukuk structures rely on the performance of an underlying asset or on a contractual arrangement pertaining to that specific asset. This makes sukuk an important facility in Islamic finance since it can be used to provide regular payments throughout the life of the financing plan. This study highligh...

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Main Author:	Adam Sa'ad, Auwal
Format:	Article
Language:	English
Published:	IIUM Press 2019
Subjects:	HG3368 Islamic Banking and Finance
Online Access:	http://irep.iium.edu.my/73821/ http://irep.iium.edu.my/73821/ http://irep.iium.edu.my/73821/1/73821-Structural%20Development%20of%20Ijarah%20Sukuk.pdf

id	iium-73821
recordtype	eprints
spelling	iium-738212020-02-21T07:36:22Z http://irep.iium.edu.my/73821/ Structural development of Ijarah Sukuk: an appraisal Adam Sa'ad, Auwal HG3368 Islamic Banking and Finance Sukuk structures rely on the performance of an underlying asset or on a contractual arrangement pertaining to that specific asset. This makes sukuk an important facility in Islamic finance since it can be used to provide regular payments throughout the life of the financing plan. This study highlights some important sukuk structures, such as ijarah for asset acquisition and sukuk with a sale and lease-backed structure. Additionally, this study suggests some important proposals to help overcome the Shari’ah issues in sukuk structures. This study suggests that sukuk structures involving the combination of sale and lease-backed contracts should involve a third party who enters into the Ijarah transaction with the investors rather than the originator himself. A benefit of this change will help avoid Inah Ijariyyah (Inah trick for) in the structure. The sukuk structure for asset securitization on the other hand, should not be traded in the secondary market because it involves a sale of debt for debt which is prohibited according to the Shari’ah principles. As for the forward lease sukuk, sukuk holders should wait for the commencement of the project before trading their sukuk in the secondary markets. This is to ensure that the Ijarah property exists before the sale process began. IIUM Press 2019-06-19 Article PeerReviewed application/pdf en http://irep.iium.edu.my/73821/1/73821-Structural%20Development%20of%20Ijarah%20Sukuk.pdf Adam Sa'ad, Auwal (2019) Structural development of Ijarah Sukuk: an appraisal. Journal of Islamic Finance, 8 (Special Issue). pp. 107-116. ISSN 2289-2109 E-ISSN 2289-2117 https://journals.iium.edu.my/iiibf-journal/index.php/jif
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG3368 Islamic Banking and Finance
spellingShingle	HG3368 Islamic Banking and Finance Adam Sa'ad, Auwal Structural development of Ijarah Sukuk: an appraisal
description	Sukuk structures rely on the performance of an underlying asset or on a contractual arrangement pertaining to that specific asset. This makes sukuk an important facility in Islamic finance since it can be used to provide regular payments throughout the life of the financing plan. This study highlights some important sukuk structures, such as ijarah for asset acquisition and sukuk with a sale and lease-backed structure. Additionally, this study suggests some important proposals to help overcome the Shari’ah issues in sukuk structures. This study suggests that sukuk structures involving the combination of sale and lease-backed contracts should involve a third party who enters into the Ijarah transaction with the investors rather than the originator himself. A benefit of this change will help avoid Inah Ijariyyah (Inah trick for) in the structure. The sukuk structure for asset securitization on the other hand, should not be traded in the secondary market because it involves a sale of debt for debt which is prohibited according to the Shari’ah principles. As for the forward lease sukuk, sukuk holders should wait for the commencement of the project before trading their sukuk in the secondary markets. This is to ensure that the Ijarah property exists before the sale process began.
format	Article
author	Adam Sa'ad, Auwal
author_facet	Adam Sa'ad, Auwal
author_sort	Adam Sa'ad, Auwal
title	Structural development of Ijarah Sukuk: an appraisal
title_short	Structural development of Ijarah Sukuk: an appraisal
title_full	Structural development of Ijarah Sukuk: an appraisal
title_fullStr	Structural development of Ijarah Sukuk: an appraisal
title_full_unstemmed	Structural development of Ijarah Sukuk: an appraisal
title_sort	structural development of ijarah sukuk: an appraisal
publisher	IIUM Press
publishDate	2019
url	http://irep.iium.edu.my/73821/ http://irep.iium.edu.my/73821/ http://irep.iium.edu.my/73821/1/73821-Structural%20Development%20of%20Ijarah%20Sukuk.pdf
first_indexed	2023-09-18T21:44:41Z
last_indexed	2023-09-18T21:44:41Z
_version_	1777413370687782912

Structural development of Ijarah Sukuk: an appraisal

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