Bangladesh Bank has recast how Sukuk are allocated among investors, opening a larger and more structured route for conventional institutions and individuals to participate in the country’s Islamic securities market.
Under the new policy, 50 per cent of each Sukuk issue will be allocated to Shariah-based banks, finance companies and insurance companies, while another 30 per cent will be reserved for Islamic branches and windows of conventional banks.
Individual investors will receive a 10 per cent allocation, with the remaining 10 per cent going to other institutional investors, including conventional banks, finance companies and insurance companies, provident funds, corporate institutions, gratuity funds and mutual funds.
The revised allocation applies to Sukuk issued by the government and other eligible entities and takes effect immediately, according to a Bangladesh Bank circular issued on Monday.
The change replaces a circular issued by the central bank’s concerned department on 4 August 2025.
The revised framework gives each investor group a defined share of an issue, reducing the possibility that demand from one category will crowd out others.
If applications from a particular category exceed its designated quota, the securities will be distributed proportionately among applicants within that category, Bangladesh Bank said.
The policy effectively gives Islamic financial institutions the largest share of the market while setting aside a combined 20 per cent for individuals and a wider pool of institutional investors.
For Bangladesh’s developing Sukuk market, the change could help broaden the investor base while giving issuers a clearer framework for distributing securities across different classes of buyers.
The inclusion of individual investors in a dedicated 10 per cent quota is particularly significant because Sukuk have traditionally been more closely associated with Islamic banks and other institutional investors.
By reserving another 10 per cent for conventional financial institutions, provident and gratuity funds, corporate investors and mutual funds, the central bank is also creating a defined channel for investors that are not part of the Islamic banking system.
The revised structure could therefore help Sukuk evolve from a largely specialised Islamic-finance instrument into a broader capital-market product, while retaining a substantial allocation for Shariah-based institutions.
Bangladesh Bank said the allocation ratios must be followed for each issue, with oversubscription handled proportionately within the relevant category.
The new rules apply immediately.
