Covered Bonds Planned South of U.S. Border in 2009
Mexican housing fund also deals in Danish-style bonds pitched by Soros
11/20/2008
In the back half of a story on a decision by Mexico’s federal housing fund to cut its 2009 lending goal, Dow Jones reporter Ken Parks discusses the fund’s plans to introduce covered bonds in that country next year. According to the story, Infonavit (the housing fund) hopes to get necessary government authorizations to issue covered bonds some time during the first quarter.
An Infonavit executive is quoted as saying that covered bonds could account for as much as 50% of the fund’s total bond issuance for 2009. The motivation, Parks writes, is “to bring new investors to [Mexico’s] secondary mortgage market, especially Europeans who are already familiar with the asset class….”
In addition to more traditional mortgage-backed securities, Infonavit is considering “BonHiTos”—a version of the Danish-style bond whose use in the U.S. was recently advocated by financier George Soros in a Wall Street Journal opinion piece.
Read the Dow Jones story: “UPDATE: Mexico Housing Fund Infonavit Cuts 2009 Lending Goal”
If you want to learn more about Mexico’s Danish-style bonds—assuming you read Spanish—you might be interested in looking at the website of the company that offers them: Hipotecaria Total. The website also includes an English-language interview with CEO Remco Polman.