Throughout the financial crisis, promoters of Shariah-Compliant Finance insisted that their products were superior because they did not allow the securitization of debt, such as happened with subprime mortgages.
What a difference a few months makes.
Now that Shariah finance has been shown to be vulnerable to the economic downturn just like everyone else and some of its key products–particularly sukuk (Islamic bonds)–are suffering from a lack of liquidity, the Shariah scholars are figuring out new ways for Shariah-Compliant Financial products to be securitized after all…
