Peter Kunzel

Islamic bond issuance: what sovereign debt managers need to know

Recent years have witnessed a surge in the issuance of Islamic capital market securities (sukuk) by corporates and public sector entities amid growing demand for alternative investments. As the sukuk market continues to develop, new challenges and opportunities for sovereign debt managers and capital market development arise. This paper reviews the key developments in the sukuk market and informs the debate about challenges and opportunities going forward.

Investment Objectives of Sovereign Wealth Funds : A Shifting Paradigm

While SWF investment objectives to some extent reflect inherent characteristics, notable differences in strategic asset allocation (SAA) exist even amongst SWFs of similar types. Even so, this paper shows that the global crisis may have changed SWF’s asset allocations in ways that may not be ideal or justified in all cases and that a review of investment objectives may be warranted. It also argues for regular macro-risk assessments for the sovereign, the continued importance of SWFs as a stabilizer in international capital markets, as well as the active role they could play in international regulatory reform.

Measuring Sovereign Risk in Turkey; An Application of the Contingent Claims Approach

Improved macroeconomic conditions and changes to the asset-liability structure on Turkish balance sheets since the 2001 crisis have improved Turkeys overall sovereign risk profile. Nonetheless, the country remains subject to bouts of volatility, as evidenced most recently in the May/June 2006 market turbulence. This paper examines these changes in Turkeys risk profile using the Contingent Claims Approach (CCA), to quantify the evolution of Turkeys sovereign risk, relate risk indicators to market prices of risk, and conduct scenario analyses to assess the effects of potential market volatility and policy adjustments on key risk indicators.

Sovereign Wealth Funds: Current Institutional and Operational Practices

While SWFs as a group share broad common institutional and operational practices, these practices also differ considerably reflecting the diversity of these institutions. These differences derive from the nature of the SWF (i.e., their original intent) as well as its legal personality. Thus, while SWF practices will continue to evolve, the fundamental objectives of different types of SWFs will continue to shape their practices going forward.