Washington, D.C., June 6, 2005 – The
International Finance Corporation, the private sector arm of the World
Bank Group, signed an agreement to provide a $115 million financing package
to GMAC Financiera, a housing finance and securitization entity in Mexico.
IFC’s financing consists of a $65 million revolving loan that will help
fund or acquire low- to middle-income mortgage loans, and a $50 million
credit enhancement facility that will support the company’s mortgage-backed
securities program in Mexico.
GMAC Financiera, a non-depository entity established in 2000 by Residential
Funding Corporation (GMAC-RFC), provides mortgage and construction warehouse
lines of credit to sofoles—specialized financial intermediaries
in Mexico—and is building its presence in the secondary housing finance
market through its securitization program. GMAC Financiera is currently
the only securitization conduit in Mexico, having launched three issuances
of mortgage backed securities in the local capital markets.
IFC’s investment, signed by Assaad Jabre, IFC’s Acting Executive Vice
President, and Jose Landa, Managing Director of GMAC-RFC’s Latin American
operations and Chairman of the Board of GMAC Financiera, underlines IFC’s
strategy to develop the housing sector in Mexico by providing funding to
key players, as well as to contribute to the development of the country’s
Mr. Jabre said, “IFC’s support to GMAC Financiera is a key step in our
housing strategy for Mexico. This financing will enable the company to
continue extending mortgage finance to sofoles as they seek to diversity
their funding base. It will thus ensure that these intermediaries
can keep providing housing finance to a large section of previously underserved
groups in the country.” Mr. Jabre added, “IFC’s financing also fosters
the development of the local capital markets by introducing a new risk-asset
class that fits well with the investment needs and objectives of institutional
investors in Mexico.”
Mr. Landa said, “GMAC Financiera is pleased to have built a strong partnership
with IFC by working together to develop the housing sector in Mexico. IFC’s
financing is a vote of confidence in our Mexican operations, and we look
forward to broadening our relationship with the IFC in other countries,
in Latin America and beyond.”
GMAC Financiera is recognized as an important alternative source of funding
for sofoles and a key player in Mexico’s secondary housing finance
market. GMAC Financiera has experienced high growth over the last
four years and has developed strong relationships with the mortgage sofoles
and other relevant industry players in Mexico.
IFC’s strategy in the housing sector in Mexico has adopted a phased approach.
The first phase has focused on helping develop a vibrant primary mortgage
market by providing local currency debt facilities to major originators
in the sector such as Hipotecaria Su Casita, Hipotecaria Nacional and Hipotecaria
Credito y Casa. The second phase is more directly focused on ensuring
the development of the secondary mortgage market. IFC’s financing to GMAC-RFC
is in alignment with this second stage. In all stages of this strategy,
IFC has collaborated with Mexico’s Sociedad Hipotecaria Federal, a federal
mortgage funding institution, in ensuring consistency with the local authorities
view on the approach to developing the housing market.
The development of a broad-based housing finance market is an important
building block for Mexico's financial sector. A functioning mortgage
system will help create a more liquid housing market and enable more first-time
buyers to purchase their own property, which in turn will help improve
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 FY04, IFC has committed more than $44
billion of its own funds and arranged $23 billion in syndications for 3,143
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY04 was $17.9 billion for its own account and $5.5 billion held
for participants in loan syndications.