• The issue totaled over 4.99 billion pesos and was backed by mortgage loans granted and managed by FOVISSSTE.
  • This is the fourth consecutive occasion that BBVA Bancomer has participated as joint lead underwriter, placing a total of approximately 19.20 billion pesos during the year and therefore concluding the FOVISSSTE's Placement Program for 2012.
  • The placement was oversubscribed 2.4 times, once again evidencing the market's trust in this type of operation, in which BBVA Bancomer took part with FOVISSSTE, one of the leading mortgage originators in the country.

BBVA Bancomer, as Structuring Agent and Joint Lead Underwriter, successfully completed the placement of around 1.03 billion UDIS (Mexico's Investment Units), i.e. 4.99 billion pesos in trust certificates issued by the Housing Fund of the Institute of Security and Social Services of State Workers (FOVISSSTE), which was 2.4 times oversubscribed.

This is the fourth placement this year in which BBVA Bancomer has taken part with FOVISSSTE. The previous operations totaled 4.06 billion pesos and 5.28 billion pesos in March and June respectively, and 4.99 billion pesos on this occasion.  The transaction reflects investors' interest in the Mexican debt market, with a total of approximately 19.20 billion pesos being placed through the government institute's placement program for 2012.

The issue was rated "AAA" on the local scale by four ratings agencies (Standard & Poor's, Fitch, HR Ratings and Moody's).

Investors were varied but mainly institutional: specialist pension fund investment companies (Siefores), money markets, private pension funds, private banks and their customers and insurance companies, among others, implying a significant diversification.

The coupon was 3.56% in UDIs, the lowest seen in FOVISSSTE's mortgage-backed securitization program that got underway in 2009.

While the placement has a legal term of 30.3 years, the average duration of these bonds is between 4.6 and 5.4 years in a stable market environment.

The portfolio backing the issue is comprised of 16,546 mortgage loans originated and managed by FOVISSSTE with an average residual term of 324 months, an average rate of 5.55% (times the minimum wage) and an average loan balance of 419 thousand pesos. The exchange was made on 31 October on the Mexican Stock Exchange (BMV).

The TFOVIS 12-4U issue was carried out using the habitual FOVISSSTE structure:

  • Through an issuing trust whose equity comprises mortgage loans granted by FOVISSSTE.
  • A key administrator to carry out quality control and monitoring of information (on a loan-by-loan basis), and draw up reports, among other functions.
  • Stock market certificates with 28% take-up and accelerated settlement.