Islamic finance securitization structures Sharia-compliant transactions as tradeable instruments. MTCM can place the underlying asset in a ring-fenced compartment of a Luxembourg SPV it operates, with the instrument built on ownership of tangible assets rather than on interest. Sharia certification is issued by an independent board, not by MTCM.
Sharia-compliant finance rests on ownership of real assets and on sharing risk, which is close to how a securitization compartment already works. The asset can be placed in one ring-fenced compartment of MTCM’s six Luxembourg SPVs, and the instrument is built around that ownership rather than around interest. MTCM structures the transaction; the Sharia certification is issued by an independent board appointed for that purpose. The compartment is bankruptcy remote in both directions, and the asset is off-balance sheet for the originator. GSK Stockmann acts as the platform’s legal counsel, with PwC and Atwell as auditors.
Held in custody, transferred or listed like any other security.
Segregated by law from every other transaction on the platform.
Protection runs in both directions.
The exposure leaves the originator’s balance sheet.
Certificates representing ownership in tangible assets or services rather than debt.
Structures built on the lease of an identified asset and the rent it produces.
Cost-plus sale structures with a disclosed margin agreed at the outset.
Partnership structures where the parties share the outcome of a venture.
Structures where one party provides capital and another provides expertise.
Manufacturing and construction structures funding an asset yet to be built.
Structures based on advance payment for goods to be delivered later.
Agency structures where an appointed agent acts within a defined mandate.
Structures combining more than one of the above within a single transaction.
Property structures adapted to Sharia requirements on ownership and use.
It structures Sharia-compliant transactions as tradeable instruments. The underlying asset is held inside one ring-fenced compartment, and the instrument is built on ownership of it rather than on interest, in line with the certified structure.
A sukuk is a certificate representing ownership in tangible assets or in the outcome of an identified venture, rather than a debt paying interest. The holder’s entitlement derives from the asset itself, which is why the structure begins with what the compartment owns.
No. MTCM structures and administers the compartment. Sharia certification is issued by an independent board appointed for the transaction. The board’s scope is agreed before the compartment is structured, and its requirements shape the structure.
Because the Luxembourg Securitization Law provides a flexible framework for holding a tangible asset in a ring-fenced compartment and issuing against it, and because the framework is familiar to European investors, custodians and counterparties.
Ijara, murabaha, istisna, salam, musharaka, mudaraba and wakala structures, alone or combined, depending on the asset and on what the appointed Sharia board requires.
Institutions and family offices with a Sharia-compliant mandate, sponsors raising capital from investors with that requirement, and intermediaries needing a European-domiciled structure their counterparties recognise.
| Structure | Built on | Typical use |
|---|---|---|
| Ijara | Lease of an identified asset | Real estate and equipment |
| Murabaha | Sale at a disclosed margin | Trade and working capital |
| Istisna | Manufacture or construction of an asset | Projects under construction |
| Salam | Advance payment for future delivery | Agricultural and commodity output |
| Musharaka | Shared participation in a venture | Joint ventures and development |
| Mudaraba | Capital from one party, expertise from another | Managed ventures |
| Wakala | An agent acting under a defined mandate | Portfolios and multi-asset structures |
80+ active compartments · €2.5 bn+ assets structured. Indicative platform figures.