Case Study On Sukuk

Secondary sources were also used when the research embarkedc by using previously published articles from 1963-2013.

A rule making body issues authorative shari’a auditing standards for all Islamic banks and other Islamic businesses and it will be the most effective way to eliminate problems within the Islamic economy. The most effort to develop a body of consistent standards for shari’a audits has been undertaken by

Serba Dinamik Sdn. Bhd. is an engineering service provider to the oil and gas and power generation sectors, with operation in domestic and overseas markets. The company has been in a business market for 24 years since 1993, and the company has its own strategic approaches to strengthen the company’s market position and competitiveness. The strategic approaches used by the company is merger and acquisition (M&A). Merger is a process of combining two or more different companies into a single corporation, while acquisition is happened when one company purchase or obtain the other company. Recently, the company is very committed in implementing this approach and plan to raise a capital within a year to facilitate M&A strategies.

company experienced sharp increases in both sales and earnings. Because of this recent growth, Kaka, the company`s treasurer, wants to make sure that available funds are being

v) SEBI may consider removal of prohibition on investment in mortgage backed securities by Mutual Fund Schemes. vi) Tax neutrality of Special Purpose Vehicle. Recommendations for tax reforms also include the spread of upfront income received by Originator over the tenure of the loan securitised, extension of benefits under Section 88 of Income Tax Act for repayment of housing loans after the loans have been securitised etc. 10. Other recommendations are summarised below: i) The most significant impact of securitisation arises from the placement of different risks and rights of an asset with the most efficient owner. The training institutes of the financial institutions should attempt to spread awareness of the benefits and scope of securitisation increasingly among financial community. ii) Spell out the risk weights and NPA norms on securitised paper. Insurance Companies and Provident Funds need to be encouraged to invest in the securitised paper. Besides, suitable regulatory framework may have to be evolved to encourage Foreign Institutional Investors. iii) Listing requirements for various securities to be issued may be stipulated which may include minimum issue size, eligible stock exchanges etc. iv) Include the securitised paper in demat trading. v) While identifying the key characteristics of special Purpose Vehicle (SPV) to keep the structure “remote” from the bankruptcy of the Originator, the Group recommends flexibility in the

Granting this loan will raise the company’s debt to equity level from the current 54% to 79%. Besides, the note will also reduce the company’s interest coverage ratios especially at this time of relatively high interest rate. However, the company has adequate

And due to that, Ingress Sukuk Berhad (ISB) was act as a Special Purpose Vehicle (SPV) to govern the whole operation related to the ijarah sukuk. The ijarah sukuk issued by ICB commencing in July 2004 and expected to be mature at July 2011, a 7 years of ijarah sukuk maturity. But unfortunately, Ingress Sukuk Berhad (ISB) ijarah sukuk defaulted on 13th July 2009 due to few reasons. There were 9 well-known companies at that time were listed as the sukuk holders for this sukuk issuance of ISB which are CIMB Berhad, Maybank Berhad, Petronas Berhad, RHB Berhad, ING Berhad, MAA Berhad, KWAP, AFFIN Bank Berhad and HSBC Berhad. Figure 2 explained the ijarah sukuk structure applied by

This article is secondary source of information. Because the experiment or research is not conducted by the author of this article. The specific studies described in this article are primary sources which are used by the author to describe different facts. These articles are describing the primary source of information because most of the researches are conducted by the authors of those articles.

As mentioned before, since the underlying asset has not been the interest of the Sukuk holders therefore they do not hold the right to sell the asset as they are not provided with the legal ownership authority. Therefore in the case of default, the transaction will be with gharar and the fairness of shariah principle will not prevail. This is because Sukuk represents the undivided ownership in the asset which is not in actually embedded the asset cannot be recourse. So in such kind of Sukuk arrangements will not be the investor’s interest. (Hidayat, 2013)

In most Islamic countries, they tend to practice two types of financing in banking industry which are conventional and Islamic banking. The country like in Malaysia has successfully developed an Islamic banking system that operates in parallel with the conventional banking system. There is similarity between conventional banking and Islamic banking which helps to promote economic growth provided financing services such as credit facilities for business activity, mortgage, securities, etc. in order to achieve their same ultimate profit objectives. However, there are also having differences in practicing financial services due to most investors having their own preferences on their investments and

The notes payable balances in case Exhibits 7 and 10 reveal that either financing alternative will satisfy the firm’s funds requirements through 2002. The instructor can question the students as to the following circumstances that might cause an adverse change in the fundamental assumptions:

Further, they consider that private equity faced the challenge of deal-making in post-crisis period. Due to large increase of distressed portfolios and numbers of bankruptcies together with continuing poor macroeconomic situation (slow job creation and GDP growth) it is difficult for private equity to find a “good deal”. Moreover, they cannot exit from choosing portfolio without losses or return which less than participating work. Finally, it is hard to attract new limited partners and grow as private equity fund. Well known private equity firm sounds better than new established fund in order to participate from sovereign wealth fund and hedge fund.

Role of SEBI – Pre-issue and Post-issue requirements & Conditions to be fulfilled by the Issuer Company:

With respect to risk management in Islamic banks, Islamic Financial Services Board (IFSB, 2005), [26], issued guiding principles for risk management in Islamic financial institutions, the board pointed out that these guiding complement the general guiding principles issued by the Basel Committee. to cover specific aspects of the institutions of the Islamic financial services. As follows:

The Sukuk market has been one of the most popular sectors in Islamic finance over the past few years. According to Zawya, 2011 was a record year for these relatively young assets which reached $84.4 billion. In 2012 Sukuk issuance is already shaping up to be a record year with $68 billion issued in the first half, an increase of 55% over the same period of 2011.