Why Do Companies Issue Sukuk?

Paul-Olivier Klein and Laurent Weill
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Paul-Olivier Klein: LaRGE Research Center, Université de Strasbourg

Working Papers of LaRGE Research Center from Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg

Abstract: This paper investigates the determinants for firms to choose sukuk over conventional bond. We investigate the potential impact of information asymmetries and adverse selection to explain why firms prefer using sukuk. We perform logit regressions of the choice of debt type to determine which characteristics lead a firm to issue a sukuk rather than a bond. We use a dataset of sukuk and conventional bond issuances in Malaysia from 2004 to 2013. We find evidence of the influence of information asymmetries and adverse selection on the choice of the sukuk market.

JEL-codes: G14 P51 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-bec, nep-dcm and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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Related works:
Journal Article: Why do companies issue sukuk? (2016)
Journal Article: Why do companies issue sukuk? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:lar:wpaper:2016-04

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