Global sukuk issuance hits record $80bn in 3Q25

October 9, 2025 (MLN): Global sukuk issuance surged to around $80billion in 3Q25, marking the most active third quarter on record, according to a new dashboard from Fitch Ratings.

The strong performance came despite multiple headwinds including new sharia requirements, geopolitical tensions in the Middle East, summer holidays, trade war uncertainties, fluctuating interest and foreign exchange rates, and commodity price volatility.

In contrast, bond issuance in core markets including multilaterals and all currencies declined by 17.6% from 2Q25. Nevertheless, global sukuk activity has remained robust in early 4Q25, supported by a healthy issuance pipeline.

“Global sukuk issuance is likely to surpass 2024 this year due to lower rates, steady Islamic investor demand, and issuers’ funding and diversification needs, with 2026 prospects being promising,” said Bashar Al Natoor, Global Head of Islamic Finance at Fitch Ratings.

“Risks persist from new sharia requirements, geopolitics, and market volatility, but fundamentals are solid. About 80% of Fitch-rated sukuk are investment grade, with no defaults or fallen angels in 3Q25.”

The significance of sukuk in emerging markets continues to rise, with an increasing share of total outstanding debt capital markets in both the GCC (40%) and ASEAN (16%) regions.

Globally, outstanding sukuk have now surpassed USD1 trillion, while the sukuk share of total debt capital market issuances in core markets GCC, Malaysia, Indonesia, Turkiye, and Pakistan climbed to over 35% in 3Q25, up from 27.5% in 2024.

In regulatory developments, the UAE Central Bank’s Higher Sharia Authority issued a resolution on the sale of rights in 1H25, prompting many GCC sukuk issuers to include new provisions in their documentation. These terms authorize trustees, upon an obligor default, to register asset titles in the trustee’s name.

However, Fitch noted that this does not make an unsecured sukuk a secured instrument nor elevate its ranking above an obligor’s existing debt. The agency cited a lack of legal precedents, ongoing regulatory complexities, and the uncertain ability or willingness of obligors to register assets as key reasons.

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