listing and trading of Sukuk in the secondary market: A case study of the Kingdom of Saudi Arabia

Sukuk play an important role within its use as one of the liquidity management tools in Islamic banks, and with the increasing value of Sukuk issuances in the Kingdom of Saudi Arabia, raises questions about what is the activity in the secondary market for sukuk in the Saudi Kingdom? and what extent can market activity be judged or not? What are the challenges facing its development and the proposed treatments in this regard? the research used the descriptive and analytical method to suit its nature and objectives of the study. The research has found that this market is not active, whether for sukuk listed in the local market, “Tadawul”, or even what is listed on the international markets such as the London Stock Exchange. By reviewing the most important challenges facing the revitalization of the secondary market for sukuk issued in the Kingdom, three main challenges have been discussed, namely: (1) Challenging Shari’a controls governing the trading of sukuk in the secondary market, the conclusion has been reached that Shari’a structures used are among the types in which they are authorized to trade. (2) Most investors prefer to hold the sukuk until the date of amortization (redemption), which is in line with the financial institution’s strategies like bonds, and then apply the same investment strategy with sukuk, (3) The lack of trading availability for retail investors in the Kingdom.

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