Sukuk bond issuances in the Iranian capital market has surpassed USD 3.6 bn.

Central Securities Depository of Iran has says Sukuk bond issuances in the Iranian capital market has surpassed USD 3.6 bn.

President and CEO of Central Securities Depository of Iran, Dr. MohammadReza Mohseni, made the remarks in an exclusive interview with national Securities and Exchange News Agency or SENA.

The CSDI CEO noted that among the primary roles of the capital market is to raise funds for major economic enterprises, adding special working groups have been created to iron out obstacles along the way to more Sukuk being issued. That is why the figure for 2016 came in at close to USD 25.5 bn, more than 14 times the level recorded the year before.

The CSDI Chief went on to say that since March, 2017, SAIPA auto-making company and SAIPA auto spare parts manufacturer and after sales services each issued more than 1 billion and 260 million US dollars Ijara Sukuk into the market which made a huge contribution to the record.

The emergence of Sukuk has been one of the most significant developments in Islamic capital markets in recent years.

It refers to the Islamic equivalent of bonds. However, as opposed to conventional bonds, which merely confer ownership of a debt, Sukuk grants the investor a share of an asset, along with the commensurate cash flows and risk. As such, Sukuk securities adhere to Islamic laws and principles, which prohibit the charging or payment of interest.

Among the companies issuing these bonds during past year were mobile phone network operator RighTel, Mahan Airlines, Isfahan Mobarakeh Steel Company, Bank Maskan, SAIPA auto-manufacturing company, the Planning and Budget Organization of Iran as well as ministries of economy, cooperatives, labour, welfare and science.

Release Date: 8/16/2017

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