The Endowment of Sukūk and the Sukūk of al-Waqf

Abstract

The modern financial engineering produced a mutual relationship between al-waqf institution, which is led by altruism motivations, and the Investing Sukuk, which is motivated by private profit goals. This research has studied the aspects of this relationship, and demonstrated that there is no legitimate deterrent of using the investing ṣukūk as a waqf keeping in mind the nature of the real assets which they represent. The paper has also demonstrated that the process of Taṣkīk (secutrization) would activate the money supply mechanisms in favor of al-waqf institution. Moreover, the paper has discussed the most important scientific and practical issues beyond the trend of financing through either waqf assets securitization, or mortgages. However, in both methods ṣukūk's holders cannot reach the real assets neither as an owner nor as a mortgagee. The research has concluded with a set of recommendations considering the financing contracts and some important notes about the future of such activities in the financial markets.