IdealRatings, Inc. a leading Islamic finance service provider globally is privileged to announce the launch of the first ever Sukuk Shariah Screening Solution. The research-based online screening service is designed to serve Islamic investors and treasuries aiming to balance their portfolios with low risk fixed income instruments yet conform to the mandates defined by their Shariah boards. Despite its infancy, Sukuk has succeeded to attract a broad range of Islamic and non-Islamic investors worldwide; however one of the challenges facing Sukuk is their compliance risk due to the disparity in Shariah opinions and acceptance of Sukuk structures and terms. Investor’s drift away from investing in Sukuk primary due to lack of transparency of the acceptability or not of the structure deployed by the issuer.
IdealRatings Sukuk Screening Solution has been designed principally to help overcome the compliance risk with an intuitive design and significant functionalities; the recently launched solution enables investors to screen Sukuk against different Shariah guidelines in the market such as AAOIFI, OIC, Malaysia Securities Commission (SC) as well as defining their own custom composite Shariah guidelines. The solution screens hundreds of Shariah standards pertaining to the different investment modes and varying Shariah views. Through the new solution, investors have the capacity to screen global Sukuk universe and construct a portfolio of Sukuk that conforms to both their Shariah mandate as well as their Investment financial standards.
IdealRatings has also designed and launched a series of Sukuk indexes, to empower the Sukuk service clients with benchmarks essential for Islamic fixed income portfolio management. With the launch of the Sukuk indexes, IdealRatings aims to provide an optimally comprehensive Sukuk Offering to Islamic treasuries and institutional investors worldwide. The Index Family constitutes Five US Dollar indices with different segmentation.
Alinma Bank, a fully Shariah-compliant bank in Saudi Arabia and the most recent bank to launch in that country, assisted in the development of the new service. Speaking on behalf of Alinma, Yasser Al-Marshde, the general manager of Alinma’s Shariah group, praised the service. “IdealRatings’Sukuk product is a true innovation that opens a new chapter in the evolution of the Sukuk industry,” said Al-Marshde. “Compiling, analyzing and screening Sukuk documentation is indeed an enormous effort; and this intuitive, intelligent service, with its impressive technical solutions and features, helps Sukuk investors screen global Sukuk against the requirements set by their Shariah Boards.”
Bader Al-Omar, Shariah Group Head at Jadwa Investment, a leading Saudi investment firm and one of the principal inspectors to the new service, said: “Over the past two years, we have worked closely with IdealRatings to ensure the successful launch of this revolutionary Sukuk Screening Solution. This is part of our overall strategy that focuses on supporting the advancement of Shariah-compliant financial and investment tools available in the industry. We are confident that this platform will contribute to a better understanding of Sukuk compliance for all.”
Anas Al Eissa, Head of Shariah Department at Al Rajhi Capital commenting on the new service, “Another breakthrough from IdealRatings after the equity screening service which will reduce the turnaround time of screening and approving a new Sukuk issuance that in return will expedite the investment decision. In addition; the research effort conducted by the team to analyze the full prospects and extract the hard-to-get information is a commending fact” Mohamed Donia, IdealRatings CEO commenting on the recent addition to IdealRatings family, “We are proud to be the pioneer of Islamic financial data. Few years ago we developed the first ever equity screening platform that was an industry breakthrough and enabled investors to screen global equities. Today we are adding another milestone; the IdealRatings Sukuk screening solution presents another stride to the Islamic finance industry. A contribution we aim to be as significant in easing illiquidity and Shariah challenges facing Sukuk” It has been a pleasure to work with the teams at Alinma, Alrajhi, Jadwa, and ADIB to come –up with such a solution, which will contribute to advance the industry.