Adoption of AAOIFI Shariah Standards by UAE Central Bank Spawns Change in Sukuk Documentation and Demand: Fitch Ratings
September 09, 2022
The adoption of the Accounting and Auditing Organization for Islamic Financial Institutions’ (AAOIFI) Shariah standards by the Central Bank of the United Arab Emirates (UAE) has led to changes in international Sukuk documentation linked to the Bank. The changes have witnessed some standardisation, yet the likelihood of more modifications in the near future remains uncertain and varied degrees of adaptability have been shown by investors, while the utility of the new documentation is yet to be put to test, according to Fitch Ratings.
Why it Matters?
The standards’ implementation took place in 2018 and its impacts started to be seen in 2021, when new clauses and revised terms started to surface in Sukuk documentation and a slowdown was felt...