Mexican Lenders Eye Local Bond Return

Mexican mortgage lender Fovissste is preparing to follow-up a debut June MXP3.5bn RMBS issue with a similarly sized transaction from the same program, according to bankers familiar with the deal. A date has yet to be set, but the sale is expected in the first half of August. Tenor will likely be similar to the 2039 June issue, which featured a 3.8-year average life and 7-year expected maturity. The UDI-denominated bond priced at a fixed 5.31%, or UDIbonos plus 225bp. Fovissste has a MXP20bn shelf, from which it should issue several times over the next 12-18 months. Banorte, Ixe and BofA-Merrill and Goldman Sachs, the same group as the previous bond, are managing the sale. Fellow government-backed lender Infonavit is also expected to bring a follow-up to its July MXP2.59bn 2031 RMBS deal managed by Banamex and Deutsche. Both the Infonavit and Fovissste deals found acceptance from investors in a skeptical market due to their simple 1-tranche structures and government-supported status.