(Adds background on Infonavit, home builders, and mortgage bond market)
By Ken Parks Of DOW JONES NEWSWIRES MEXICO CITY -(Dow Jones)- Mexico's federal housing fund Infonavit said Wednesday it has cut its lending forecast for next year to 500,000 loans, down from previous guidance of 550,000, as the global financial crisis makes it more difficult for the institution to raise funding in the capital markets.
The fund, Mexico's No. 1 mortgage lender with over 580 billion pesos ($43.38 billion) in loans on its balance sheet, also lowered its outlook for 2010 to 570,000 loans from the 600,000 it forecast in November of last year.
"We are being conservative in the financial projections we are giving" for the next two years, said Victor Borras, the fund's chief executive, at a press conference.
Borras said the fund is on track to meet its 2008 goal of 500,000 loans.
For the 2009-2013 period, Infonavit expects to make 3.12 million loans and to raise MXN115 billion in funding from the sale of different types of mortgage bonds.
Infonavit alone - which is financed by its lending operations, mandatory employer contributions on behalf of about 14.4 million salaried workers, and the sale of mortgage-backed securities - accounts for more than half of all home loans made every year in Mexico.
In recent years, the fund has shifted its focus to low- income workers. Next year, Infonavit expects 370,000 of its loans will go to people earning less than 6,395 pesos ($480)a month.
Home builders have indicated in recent weeks that they plan to boost their exposure to the low-income housing market, which is supported by government-sponsored institutions like Infonavit and therefore less susceptible to a downturn in the economy.
Last month, the Bank of Mexico cut its outlook for economic growth this year to 2% from 2.25%-2.75%, and said the economy will probably grow between 0.5% and 1.5% next year due to the global financial crisis and U.S. slowdown.
Infonavit Eyes Covered Bond Issuance In 2009
Infonavit is also the largest issuer of mortgage-backed securities in Mexico, having sold MXN33.31 billion of its Cedevis mortgage bonds since it first went to market in 2004, including MXN12.28 billion this year alone.
Ariel Cano, the fund's chief financial officer, said Infonavit has filed to make one last issuance for up to MXN3 billion, most likely in mid-December, that would allow it to meet its 2008 budget of MXN15 billion.
In comparison, banks and home finance companies have sold just MXN13.68 billion in mortgage bonds so far this year, compared to MXN22.42 billion in 2007, as volatility in financial markets and risk aversion limit the number of deals.
For 2009, Infonavit aims to sell MXN10 billion in mortgage bonds, mainly on the local market, including Cedevis, Bonhitos and what could be the first issuance of covered bonds in Mexico.
Bonhitos are AAA-rated mortgage bonds sold by Hipotecaria Total, a firm whose securitization platform is based on the Danish system.
Covered bonds, which are backed by the cash flows from home loans, have existed in Europe since the 18th century.
Unlike mortgage-backed securities, where the underlying loans are held in off-balance sheet pools, covered bond assets stay on the lender's balance sheet. In the event of default, the investor has recourse to both the underlying mortgages and the issuer.
Mexico's non-bank finance companies can already issue covered bonds under existing regulations, although none have chosen to do so. Congress, however, would have to amend the country's banking law and regulators would have to change regulations before banks could issue covered bonds.
The potential to bring new investors to the country's secondary mortgage market, especially Europeans who are already familiar with the asset class, would be one of the biggest advantages of creating a domestic covered bond market, according to mortgage industry officials.
Cano hopes to have the necessary authorizations in place to issue covered bonds - including an amendment to Infonavit's charter by Congress - during the first quarter of next year.
The executive said covered bonds could account for up to 50% of the mortgage bond issuance Infonavit has budgeted for next year.
"The main advantage has to do with the current situation. Mortgage-backed securities are being questioned not only nationally, but globally. It's a way to have a financial structure that generates confidence among investors," Cano said.
-By Ken Parks, Dow Jones Newswires; 52-55-5080-3453; ken.parks@dowjones.com
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(END) Dow Jones Newswires
November 19, 2008 17:32 ET (22:32 GMT)

Publié le 19 novembre 2008 Copyright © 2008 Dowjones