Abutorabi

Tehran, Dec.07 (SENA) - Iran's ministry of economy has plans in hand to raise funds to cover public projects' costs via issuance of Sukuk financial instruments.

In an interview with the Securities and Exchange News Agency, Gholamreza Abutorabi the managing director of Iran’s Capital Central Asset Management Company asserted:the  Sukuk financial instrument will worth 40,000 billion Rials in sum and the proceeds will be expensed in public projects .

He continued: This is the third round of issuing Sukuks .that being said, the interest rate is 17.9 percent and they will mature in 3 years .

It is worth noting, sukuk is an Islamic financial certificate, similar to a bond in Western finance, that complies with Islamic religious law commonly known as Sharia . Since the traditional Western interest-paying bond structure is not permissible, the issuer of a sukuk sells an investor group a certificate, and then uses the proceeds to purchase an asset, of which the investor group has partial ownership. The issuer must also make a contractual promise to buy back the bond at a future date at par value.

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