Sukuk as a Financial Asset: A Review

Sukuk, an Islamic replication of bond, is a structured financial instrument innovated about two decades ago in line with the historical development of Islamic finance. Despite the phenomenal growth of global sukuk market, the academic research on sukuk is yet at infancy stage, particularly because scholars did not deeply look at this remarkable financial innovation. As of now, there is a growing body of sukuk literature that mostly based on qualitative analysis addressing shari’ah guidelines, ethical matters, distinguishing features, contractual mechanisms and structures of sukuk; a few of them provide some empirical analyses. Given this background, we make fundamental efforts to conduct a systematic review on sukuk studies to identify the unexplored research issues on sukuk. Hence the findings of the meta-analysis identify several thematic areas on sukuk, such as: (i) Sukuk characteristics, (ii) sukuk and convention bonds, (iii) sukuk valuations, (iv) sukuk roles in corporate capital structure and (v) key challenges in sukuk market. All in all, this academic effort significantly contributes to enhance our knowledge in Islamic finance and outlines the specific future research agenda.