Article Published in Islamic Finance in Practice, Winter 2009

Introduction: Global financial institutions are experiencing the aftershocks of the financial crisis and the severe liquidity squeeze. The Islamic finance industry, although initially seen as relatively insulated, is not immune from the crises and is also feeling the threats. As such, players in this industry are searching for new products to cater for changing investor attitudes; in times of crisis, Islamic financial institutions and investors seem to have one of the following attitudes:

1. Reluctantly going back to basics, avoiding complex structures and focusing on traditional straightforward investments
2. Creating a new generation of Islamic financial products and structures which can provide investors with safer and more conservative investments
3. Comparing the costs of structuring Islamic financial products against those of conventional products and squeezing any premium placed on top

From our perspective, we strongly believe that the Shari’a-compliant concepts have great flexibility and greater potential for developing new products which are yet to be uncovered. One example of these concepts is the Wa’ad and its variations.

Click here for a full text version (PDF file 161ko).

Article Published in Islamic Finance in Practice, Winter 2009

Introduction: Global financial institutions are experiencing the aftershocks of the financial crisis and the severe liquidity squeeze. The Islamic finance industry, although initially seen as relatively insulated, is not immune from the crises and is also feeling the threats. As such, players in this industry are searching for new products to cater for changing investor attitudes; in times of crisis, Islamic financial institutions and investors seem to have one of the following attitudes:

1. Reluctantly going back to basics, avoiding complex structures and focusing on traditional straightforward investments
2. Creating a new generation of Islamic financial products and structures which can provide investors with safer and more conservative investments
3. Comparing the costs of structuring Islamic financial products against those of conventional products and squeezing any premium placed on top

From our perspective, we strongly believe that the Shari’a-compliant concepts have great flexibility and greater potential for developing new products which are yet to be uncovered. One example of these concepts is the Wa’ad and its variations.

Click here for a full text version (PDF file 161ko).