Title: Sukuk bonds as an alternative to conventional bonds
Abstract: In the conventional financial system, one of the most important financial instruments are bonds. Issuance and sale of bonds are one of the most effective ways of financing modern corporations and financial institutions. On the other hand, the use of bonds in their traditional form is not possible in the Islamic financial system. Bonds are based on interest, which is strictly prohibited by the principles of Islamic banking. Therefore, the Islamic financial experts have developed sukuk bonds as an alternative to conventional bonds. The subject of this paper is the analysis of sukuk bonds as potential alternatives to conventional bonds. The main goal of this research is the examination of the viability of applying sukuk bonds in the contemporary economic and social environment by analyzing the theoretical concepts of these instruments, existing experience with their use in practice, and comparing them with similar conventional financial instruments. In the paper, the following research methods are applied: analysis method, comparative method, historical method, description method, statistical method and empirical method. The research results show that certain types of sukuk certificates have more in common with equity financial instruments than with bonds, as well as that the difference between other types of sukuk and conventional bonds is more often theoretical than practical.