BAKU, Azerbaijan, Aug. 23
By Elnur Baghishov – Trend:
The Central Bank of Iran (CBI) will auction “sukuk” worth about 141 trillion rials (about $3.35 billion) tomorrow on August 24, 2021, Trend reports citing the CBI’s website.
According to the report, the annual percentage of each sukuk to be sold at this auction is about 17 percent.
The Central Bank of Iran sold 87.6 trillion rials (about $2.08 billion) worth of sukuk yesterday on August 22.
“So, Iran’s four banks and financial institutions took part in the auction,” the report said.
The Central Bank of Iran may sell sukuk on the secondary markets according to Iran’s budget for the current Iranian year (from March 21, 2021, through March 20, 2022).
As well as, the CBI has no obligations regarding the value and quantity of sukuk sold and will not purchase sukuk in the primary market to finance the government.
Sukuk is an Islamic financial certificate, similar to a bond in Western finance that complies with Islamic religious law commonly known as Sharia.
Generally known by their Arabic name, sukuk, and often incorrectly referred to as ‘Islamic bonds’, Sharia-compliant, fixed-income capital markets instruments have steadily increased their share of global markets over the past decade.
Sukuk are financial products whose terms and structures comply with Sharia, with the intention of creating returns similar to those of conventional fixed-income instruments like bonds.
Unlike a conventional bond (secured or unsecured), which represents the debt obligation of the issuer, a sukuk technically represents an interest in an underlying funding arrangement structured according to Sharia, entitling the holder to a proportionate share of the returns generated by such arrangement and, at a defined future date, the return of the capital.
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