Mohamad Naghi Nazarpoor; Mohamadreza Yousefi; Meysam Haghighi
Volume 17, Issue 53 , February 2013, , Pages 159-185
Abstract
Considering the prohibition of riba (Usury), and consequently the impossibility of using interest based bonds, they can not utilized as policy tool in the Usury-Free Banking System. As a result the Open Market Operations as specified by buying and selling interest-based bonds is not applicable ...
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Considering the prohibition of riba (Usury), and consequently the impossibility of using interest based bonds, they can not utilized as policy tool in the Usury-Free Banking System. As a result the Open Market Operations as specified by buying and selling interest-based bonds is not applicable in this system. Thereby virtually the oldest and best-known, and yet the most important tool of monetary policy for controling liquidity in the economy is excluded from the set of policy tools of the central bank.. Instead there are certain replacement securities such as “Participatory Bonds”, “Istisna securities” etc. devised by Moslem economists to be utilized as a substitute for the Open Market Operations in a non-usury banking system .The current paper using a descriptive methodology attempts to analyz the hypothesis that: “utilization of “Negotiable Certificates of Deposit”, as a compliment for bonds, Sukuk and other securities Provides Central Bank with alternative basis for policy tools in liquidity control and monetary management, within the framework of the Usury-Free Banking System, and therefore to some extent compensate for the absence of traditional bonds in monetary policy tools." Finally it is concluded that “Negotiable Certificates of Deposit” as a means of supplementing other securities, can be used in open market operations in a non-usury banking, enabling central bank to buy and sell securities through open market operations in the secondary market, This can effectively enable the monetary authority to manage the liquidity and enforce the monetary policy.
Mohamad Naghi Nazarpoor; Ayoub Khazaei
Volume 17, Issue 52 , October 2012, , Pages 183-209
Abstract
Along with other transitional developments Iranian capital market is also expected to expand and diversify in the course of country’s 20 year perspective development plan. Securities and exchange council has recently authorized several financial instruments in order to meet the needs of the market ...
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Along with other transitional developments Iranian capital market is also expected to expand and diversify in the course of country’s 20 year perspective development plan. Securities and exchange council has recently authorized several financial instruments in order to meet the needs of the market for financing various economic projects. One of these instruments is the “ISTISNA' Sukuk”. This paper introduces this new financial instruments and gives a clear description of it, and its various forms such as “debt purchase Sukuk”, “lease to own Sukuk”, and “mortgage based Sukuk”. Finally various features of the proposed sukuk are compared and analysed.