 In this module, we shall try to study some basic features of a particular sucuk which is called sucuk al estethmar or simply sucuk estethmar. Sucuk estethmar is one of the three sucuk structures that do not require prior existence of an eligible asset. In fact, to be more precise sucuk estethmar is one of the three and a half sucuk structures which do not require pre existence of an asset. In case of sucuk estethmar, we have studied the asset may not exist or asset may exist in a bit of quantity. In case of sucuk mudaraba, at the time of sucuk issuance, the pre existence of sucuk assets may not be compulsory and in case of sucuk musharka that is another case as well. So these are just a few sucuk structures where the pre existence of an asset is not required. In this case, the example we are going to use, the sucuk assets actually pre existed but they were not used at the time of the issuance of sucuk. Hence, the statement holds that sucuk estethmar is one of the sucuk structures which would not require pre existence of the sucuk assets. The structure which we are going to discuss, it is usually used by Islamic banks to raise more funds for their general banking activity. So it could be sucuk estethmar could be deemed as a banking sucuk because it is in most cases issued by Islamic banks to raise more money. Let us look at this structure which seems quite complicated like sucuk estethmar and we would go in the detail of the structure with the help of steps 1, 2, 3, 4, 5 and so on. Step number 1 which is identified here, sorry this is 11, this one so let me this one. So step number 1, it is actually issuance and sale of sucuk. The issuer which is this SPV, SPV issues and sells sucuk to investors. So when it sells sucuk to investors, of course it receives sucuk proceeds. The price of sucuk is then received by the issuer. This money is then used to buy a portfolio and investment portfolio from the obligor. So this is the step number 3. So step number 3 is sale of investment portfolio which would be called sucuk assets by the obligor to the issuer. Why this investment portfolio is sold? Because the obligor is looking for more money, right? So price of when the sale of investment takes place, price of sucuk asset goes from the issuer to the obligor. And that is the main objective of structuring and issuing this sucuk. Once this has happened, the issuer would actually like to appoint the obligor as its investment manager. These investment portfolios, if this was an Islamic bank, this investment portfolio could comprise Islamic moggages, i.e. Islamic home finance products, Islamic car finance products and other assets of this type. And because the bank is expert in managing these assets, so the issuer would appoint the bank as its investment manager to continue to manage these assets. So when these assets are being managed and if they are managed successfully, they would generate income. So income generation from this investment portfolio would take place. Now if that income is greater than the benchmark return which the investors were looking for, then the benchmark returns, they would be given to the investors and any excess that would actually go into a reserve account. This is a feature similar to what we have studied in the context of profit sharing investment account. If you remember, in that context we had two reserves, a profit equalization reserve and an investment risk reserve. So this excess reserve or reserve account is similar to that one. Now at the end, when this would happen for one year, two years, three years, whatever be the financing period, at the end, if there is excess money available in this reserve account, the issuer on behalf of the investors would give that money to the obligor, to the investment manager, which serves as a bonus for excellence in management. At the end, the investment portfolio would be sold back to the obligor. The issuer would receive the price of the investment portfolio. That price would be used to pay back the investments done by the investors. So this is the basic structure of a Sukuk ististmar. It looks complicated, but in practice those who are well versed in Sukuk, they find it a standard kind of practice, which is being adopted by Islamic banks around the world. The likes of Sukuk ististmar and other Sukuk, Sukuk, Musharaka and Mudarba, they are being used by Islamic banks to fulfill their regulatory requirements for capital.