| Industry Polls Reveal... |
| Poor corporate credit the major cause of recent sukuk defaults and near defaults |
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| Delegates blame poor corporate credit for the spate of recent sukuk defaults and near defaults, a driver which reflects little on the credibility or acceptability of sukuk structures themselves. Despite this, over a third of delegates do blame the industry and cite a lack of Islamic regulatory oversight. |
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| A long road to truly asset backed sukuk |
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| An overwhelming majority of delegates believe it will take more than three years for sukuk to become truly asset backed, that is if it is ever even a possibility. Practitioners generally support the view that sukuk structures will not evolve from the existing asset based structures any time soon, with only a small minority believing that asset backed sukuk will emerge more regularly during the coming 12 months. |
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| Majority of innovation in Islamic structures to come from outside the GCC |
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| Kuala Lumpur and London expected to be the biggest drivers of innovation in Islamic product structures in the years to come. Only a minority of delegates believe that Saudi Arabia or Dubai will be the main drivers of innovation. |
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| Opinions divided on the use of derivatives in Islamic Finance |
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| Industry opinions were split down the middle on whether the use of derivatives is acceptable in Islamic Finance. While 55% of voters believe the derivatives are vital to the growth of the shariah compliant finance sector or could help the sector to grow, 45% of voters believe that the industry would be much stronger without derivatives, including 11% of voters who felt strongly that the use of derivatives is damaging to the industry. |
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| A majority of voters advocate a level regulatory playing field is the most important step for Islamic Finance to gain traction in emerging Islamic Finance markets |
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| Over 50% of voters claim that establishing a level playing field with conventional financing is the best way to facilitate the growth of Islamic Finance in new markets, while over a quarter feel that a key barrier to growth is a lack of knowledge of shariah compliant financing within the existing banks in new jurisdictions. |
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| Practitioners advocate further debate in the workings of the Shariah Supervisory Board |
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| Delegates advocate further debate in an attempt to identify an appropriate model for a new kind of Shariah Supervisory Board that caters for all schools of thought. While less than a quarter of delegates believe that it is difficult to achieve a unified approach to Islamic Finance given the different schools of thought, the majority of delegates believe standardization is important for the growth of Islamic Finance and welcome further debate. |
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| Industry seeks alternatives to commodity murabaha for Islamic liquidity management |
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| A majority of delegates believe that the use of commodity murabaha as an Islamic liquidity management tool will be phased out as the industry develops and introduces satisfactory alternatives. However, a quarter of delegates insist that there is no viable alternative to commodity murabaha and it is here to stay. |