WASHINGTON, D.C., June 25, 2004 — The
International Finance Corporation, the private sector arm of the World
Bank Group, today signed an agreement to invest the Mexican peso equivalent
of $100 million in Hipotecaria Nacional, the country’s largest specialized
mortgage finance institution (Sofol).
Mexico has strong pent-up demand for housing, with an estimated deficit
of some 4 million units, reflecting the difficult access to housing finance
for most individuals – and especially the poor. Given this acute shortage
of housing, IFC’s investment, a revolving warehousing line of credit in
pesos, will help Hipotecaria Nacional underpin the origination of mortgage
loans to low-income Mexicans.
IFC’s investment will also help support Hipotecaria Nacional’s strategy
of identifying alternative funding sources while it moves from public to
private sector-based funding over the next few years.
At the signing in Washington, Peter Woicke, Executive Vice President of
IFC, said, “IFC is proud to partner with Hipotecaria Nacional in our first
mortgage warehousing transaction in Mexico, a project with a large demonstrative
effect as it facilitates the creation of mortgage financing for low-income
families.” He added, “IFC’s loan will, concurrently, help deepen local
capital markets and foster the development of a new asset class.”
Mr. Marcos Katz Halpern, Chairman of the Board of Hipotecaria Nacional
and one of three major shareholders, said at the signing, “We are pleased
to work with IFC on this landmark project, one that will facilitate the
creation of many more mortgages for low-income housing in Mexico. Hipotecaria
Nacional has developed an effective business model in originating and servicing
mortgages in the low-income housing segment. IFC’s warehousing line will
help Hipotecaria Nacional stay competitive, and foster the creation of
a secondary mortgage market”.
Victor Requejo Hernández, Chief Executive Officer of Hipotecaria Nacional,
said, “We welcome IFC’s partnership in enabling Hipotecaria Nacional
to expand mortgage operations to a segment of the Mexican population that
has limited access to mortgage finance. It also helps us transition
proactively from public to private sources of funding.”
Bernard Pasquier, IFC’s Director of the Latin America and Caribbean Department,
also noted: “IFC’s warehousing line addresses Mexico’s dearth of low-income
housing - an important step in improving
living standards. It is also is a first step toward development of a viable
secondary mortgage market, a key ingredient in IFC’s housing finance strategy
Hipotecaria Nacional is a nondeposit-taking specialized mortgage finance
company and is Mexico’s largest in that field. It extends residential
mortgages financed by monies primarily from the Sociedad Hipotecaria Federal,
a government mortgage lending instituion, mainly to low-income segments
of the population.
Hipotecaria Nacional was established in 1994 and is owned by a group of
Mexican entrepreneurs. Total assets of Hipotecaria Nacional as of March
2004 stood at $2.5 billion and capital at $156 million. Hipotecaria Nacional’s
high credit ratings reflect its solid profitability, highly experienced
management, and efficient cost-income structure.
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY03, IFC has committed more than $37
billion of its own funds and arranged $22 billion in syndications for 2,990
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY03 was $16.8 billion for its own account and $6.6 billion held
for participants in loan syndications.