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Sukuk bonds

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Sukuk bonds

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • February 5, 2018 at 3:29 pm #435307
    herocomesalong
    Member
    • Topics: 66
    • Replies: 36
    • ☆☆

    Good day tutor,

    I am still trying to understand the difference between asset backed and asset based Sukuk. I referred to this page (https://www.investment-and-finance.net/islamic-finance/questions/what-is-the-difference-between-asset-backed-sukuk-and-asset-based-sukuk.html) and it said that under asset backed sukuk, Sukuk holders cannot recourse to the originator (recourse only to underlying assets).

    On the other hand, it said that under asset based Sukuk, Sukuk holders can recourse to obligor (originator) if there is a shortfall in payments.

    What is the difference between recourse to Obligor and recourse to underlying assets?

    I also do not understand how an asset based Sukuk is riskier than a typical A-tranche of a securitisation if the Sukuk holders are guaranteed rental payments. (Maybe understanding the first part of my question will help me in this though..)

    February 6, 2018 at 6:04 am #435421
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54721
    • ☆☆☆☆☆

    The article on the ACCA website covers everything that can possibly be asked about Sukuk bonds.

    https://www.accaglobal.com/middle-east/en/student/exam-support-resources/professional-exams-study-resources/p4/technical-articles/islamic-finance—theory-and-practical-use-of-sukuk-bonds.html

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Viewing 2 posts - 1 through 2 (of 2 total)
  • The topic ‘Sukuk bonds’ is closed to new replies.

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