Background This essay seeks to compare and contrast Islamic Sukuk with Bank issued Bonds, especially in terms of their respective risks, volatility and yield factors. The fact that Shariah does not believe in trading in money, and prohibits interest transactions are one of the distinctive features of Islamic bonds vis-à-vis other kinds of bonds. So what essentially happens in a Sukuk investment is that the investor returns the sukuk instrument to the issuing bank and in turn receives a commitment for rent disbursements to him on underlying assets, and also a pledge to honor the sukuk upon its maturity. Besides, another factor is that through investments in such bonds, the investor gains certain amount of ownership in the assets of the company in the extent of his investments, which unfortunately is not possible in the case of bank Bonds, especially the World Bank bond which would be our subject matter of study. What are Mudaraba sukuks That being said, it is now necessary to consider the bonds issued by Saudi Hollandi Bank (SHB). It is observed that the sukuk offered by them are Mudaraba Bonds. Some of the characteristics of these kinds of bonds are that they are a contract between owners of capital and managers. Typically, in a Mudaraba contract, the financiers, viz. the venture capitalists assign the help of a manger to take care of the funds against a share of profits. There may be essentially one or more owners of capital and the appointed managers. The risk of capital under Mudaraba is entirely borne by the owners of capital, while the manager would receive share of profits or compensation only if he produces desired quantum of profits as per agreement. The details of this Saudi Hollandi bank Mudaraba Sukuk are as follows:  1. The minimum value of sukuk is SR500,000  2. It is in denomination of SR100,000  3. The mandatory minimum agency fee of SR 100,000 has to be paid  4. The shareholders of the Mudaraba sukuk would be getting “90 per cent.of the Net profit” and balance 10% would go to the issuer” (Legal Advisers to Joint Bookrunners & Joint Lead Managers 28).  5. The proceeds would be used in the Islamic Business Portfolio and the Capital, as utilized in this Portfolio, will make up the assets of the Mudaraba  6. The sales and delivery of these Mudaraba Sukuk would be made only to natural citizens of the Kingdom of Saudi Arabia (KSA) or to persons having a permanent base in this country.  7. There is no coupon attachment and thus the question of any payments except the Periodic Distribution Amounts. (PDA). Around the last day in June and December each year, commencing June 2010, the PDP would be regularly paid off. The Periodic distribution period amounts would be according to this formulae : P x (S +M) x D /360, where:   * P= Face value of the Mudaraba sukuk   * S = Six months SIBOR for periodic period   * M = Margin or step up margin, as need be   * D = Actual number of days.  1. The Expiry period would be on December 31, 2019  2. Investors could call back investments at the end of fifth year- 2014  3. The sukuk are sold through private placements. Details of 3.5% green bonds issued by World Bank It is now proposed to take up a comparative study of Mudaraba sukuk issued by 3.5% Green Bonds issued by the World Bank. The details of this WB Bond issue are:   * “Issuer: Internati