Bloomberg Launches Shariah Sukuk Indices as Global Islamic Bond Market Surpasses $1 Trillion

The new benchmarks track performance across currencies, credit tiers and regions — filling an institutional gap in a market that has tripled in a decade and is now too large for mainstream finance to ignore.

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Bloomberg has launched the Bloomberg Shariah Sukuk Indices, a new family of fixed income benchmarks designed to track the global Sukuk market, which surpassed $1 trillion in outstanding debt at the end of 2025. The indices cover multiple currencies and segments including US dollar-denominated, investment grade, high yield, emerging markets and the Gulf Cooperation Council (GCC). Shariah compliance is assessed by IdealRatings using standards set by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). The launch reflects growing institutional demand for transparent, rules-based tools in a market that has outgrown its niche origins.

Why has Bloomberg launched Sukuk indices now?

The timing is driven by scale. The global Sukuk market hit $1 trillion in outstanding debt by the end of 2025, according to Bloomberg data — a milestone that transforms Islamic bonds from a specialist asset class into one that demands the same institutional infrastructure as conventional fixed income. A decade ago, Sukuk outstanding stood at roughly $340 billion. The market has effectively tripled.

That growth has been concentrated in the Gulf Cooperation Council states — Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain and Oman — where sovereign and corporate issuance has surged on the back of economic diversification programmes such as Saudi Vision 2030. But it extends well beyond the GCC. Malaysia remains the world’s largest Sukuk issuer by volume, while issuance from Turkey, Indonesia and Pakistan has expanded steadily. European institutions, including the UK Treasury (which issued a sovereign Sukuk in 2014 and 2021) and Luxembourg’s listings exchange, have positioned themselves as Western gateways for Islamic capital markets.

Until now, institutional investors lacked a comprehensive, rules-based benchmark suite for Sukuk comparable to what Bloomberg’s US Aggregate or Global Aggregate indices provide for conventional bonds. The new indices fill that gap with coverage spanning multi-currency, USD-denominated, investment grade, high yield, emerging markets and GCC-specific segments.

As we explored in our analysis of why investors are pouring record sums into European stocks, capital allocation is being reshaped by structural shifts — and the institutionalisation of Islamic finance is one of the most significant.

What do the new indices cover?

The Bloomberg Shariah Sukuk Indices use the firm’s standard rules-based fixed income index framework, adapted with Shariah compliance screening from IdealRatings. The screening follows standards set by AAOIFI, the Bahrain-headquartered body that sets global Shariah accounting and auditing standards for Islamic financial institutions.

The index family includes segmentation by currency (multi-currency and USD-denominated), credit quality (investment grade and high yield), and geography (emerging markets and GCC). This granularity allows portfolio managers to benchmark Shariah-compliant fixed income strategies with the same precision available in conventional bond markets. Bloomberg already has more than 500 ETFs with over $1 trillion in assets tracking its fixed income indices — bringing Sukuk into that ecosystem gives the asset class immediate visibility among the world’s largest allocators.

Nick Gendron, Global Head of Fixed Income Index Product Management at Bloomberg, said the indices were designed to help investors “construct, benchmark, and develop Shariah-compliant fixed income portfolios with confidence.” The indices are accessible via the Bloomberg Terminal.

Why should European business leaders pay attention?

The intersection of Islamic finance and European capital markets is deepening. London remains one of the world’s top centres for Sukuk listings and advisory work. Luxembourg’s stock exchange lists more international Sukuk than any European peer. Frankfurt and Dublin are positioning for Islamic finance flows as GCC sovereign wealth funds — which collectively manage over $4 trillion — diversify their allocations.

For European corporates and financial institutions, the $1 trillion Sukuk market represents both a funding opportunity and a competitive landscape. As Gulf states accelerate infrastructure spending and green transition projects, Sukuk issuance is increasingly used to fund initiatives that overlap with ESG mandates — creating a natural bridge between Islamic finance principles and European sustainable finance regulation. As we reported in our coverage of the EU’s evolving financial rules, regulatory convergence between ethical finance frameworks is accelerating.

The benchmark launch also has implications for the growing competition between financial centres. As we examined in our analysis of Europe’s top corporate gateways, cities like Frankfurt, Paris and Amsterdam are competing for global capital flows — and credible Islamic finance infrastructure is becoming part of that contest.

Meanwhile, the rise of institutional Sukuk benchmarks arrives as strategic partnerships reshape the payments and financial services industry and as the broader 2026 outlook for AI, cyber and financial infrastructure points to technology-enabled compliance and screening becoming standard across all asset classes — including Shariah-compliant ones.

A $1 trillion market now has the institutional plumbing to match its scale. For European finance, the question is no longer whether Islamic bonds matter — it is whether the continent is building fast enough to capture its share of the flow.

Frequently Asked Questions

How large is the global Sukuk market?

The global Sukuk market surpassed $1 trillion in outstanding debt at the end of 2025, according to Bloomberg data. The market has roughly tripled over the past decade, driven primarily by sovereign and corporate issuance from GCC states, Malaysia, Turkey and Indonesia.

What are the Bloomberg Shariah Sukuk Indices?

They are a new family of rules-based fixed income benchmarks launched by Bloomberg on 25 February 2026. The indices track Sukuk performance across multiple currencies, credit tiers (investment grade and high yield) and regions (emerging markets and GCC), with Shariah compliance screening by IdealRatings using AAOIFI standards.

Why does this matter for European investors?

London, Luxembourg, Frankfurt and Dublin are all positioning as Western gateways for Islamic capital markets. With GCC sovereign wealth funds managing over $4 trillion and Sukuk increasingly used for ESG-aligned infrastructure funding, institutional benchmarks give European allocators the tools to participate in a market they can no longer afford to overlook.

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