Sukuk, also known as Islamic securities or Islamic bonds, represent one of the most significant instruments of the Islamic capital markets. Sukuk have been extensively used for raising government funds via sovereign sukuk issuances as well as obtaining funds for companies through corporate sukuk offerings. Sukuk were initially introduced as an alternative instrument which serves the same purpose of providing long-term financing as conventional bonds, however, without compromising the requirements of Shariah (Islamic law). The features of the early sukuk issuances thus mimicked those of fixed-income instruments. Nonetheless, over time the features of sukuk have evolved to include their own distinctiveness while at the same time maintaining some characteristics similar to bonds.
