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Bonds (Sukuk)

Bond is a debt instrument, you can use Bonds to lower your risk or to diversify your portfolio. The following bonds are due to be listed on the Somali Stock Exchange:

  • Government Bonds
  • Corporate Bonds

Corporate Bonds (Sukuk)

These debt instruments provide a way for the corporate entities concerned to raise money for large capital projects. Investors lend their money in return for regular profit payments. After a predetermined period, the loans are paid back to the investors. Listing the bond on the SSE Debt Board improves the issuers’ ability to raise finance because it allows investors to sell the loan to other investors should they wish to.

Each loan has specific characteristics that appeal to different investors at different times, so there is a secondary market in Corporate Bonds. Corporate Bonds carry no claim to ownership, Bondholders’ repayments take priority over payments to shareholders. Corporate Bonds usually pay higher interest rates than Government Bonds, however they are considered to be a less risky way to invest in a company than buying Shares.

Liquidity remains relatively low compared with government debt, but issuance keeps growing.

Government Bonds

Government entities issue Bonds and list them on the debt market in order to raise funds for large capital projects such as roads, power stations and hospitals.

Who is this for?

The market is used by Issuers to raise debt. It is also used by investors and banks to buy the paper to enhance returns on portfolios.

The listed debt market is predominately a wholesale market with large investors taking positions in bonds to satisfy portfolio needs. However, it also caters for the smaller investor. Anyone can buy these instruments.

How to get Corporate Bonds (Sukuk)

To have access to this product, please with register SSE.