Chadbourne & Parke represented Fondo de la Vivienda del Instituto de Seguridad y Servicios Sociales de los Trabajadores del Estado (FOVISSSTE) in the successful placement of its fifteenth mortgage loan portfolio securitization, known as TFOVIS and worth approximately US$573 million, the largest RMBS ever done in the Mexican market.
The settlement of the issuance on the Mexican Stock Exchange (BMV) took place on May 9, 2013 and was rated “AAA” by Standard & Poor’s and Fitch Ratings.
“We are glad to have assisted FOVISSSTE in not only Mexico’s largest residential mortgage-backed securitization ever completed, but also one that was closed in a record time,” said Alejandro Landa, who led the Chadbourne team on the transaction.
This transaction took place during a highly favorable macroeconomic environment in Mexico. Historically low interest rates resulted in a demand from investors equivalent to 2.8 times the amount offered and the lowest interest rate for FOVISSSTE’s securitizations and for an RMBS in the domestic market. This transaction consolidates TFOVIS issuances as the third most important asset class for the domestic market and reflects confidence from investors in the administration of FOVISSSTE.
FOVISSSTE is the mortgage fund for government employees in Mexico. It forms part of Mexico’s social security agency for workers in the public sector (ISSSTE) and has an objective of managing the contributions from ISSSTE’s affiliates in order to grant accessible mortgage loans that are affordable and manageable for public sector workers. Chadbourne has successfully acted as transaction counsel in all of FOVISSSTE’s securitizations.
Chadbourne Mexico City partner Alejandro Landa and associates José Carrillo and Carla García represented FOVISSSTE. The underwriters were HSBC, BBVA Bancomer, Actinver and Banorte Ixe.
