Mexico's domestic ABS issuance has yet to lose steam ahead of the looming holidays. Two deals have priced so far this December and at least a couple of others could close before the year is up.

The last originator to descend on investors was state agency Infonavit, the country's biggest generator of mortgages. Last Wednesday, the issuer priced an RMBS for 298 million inflation-indexed units (UDIs) ($102 million) at a real rate of 5.66%. BBVA Bancomer and Inversora Bursatil jointly led the transaction, which had a final maturity of 22 years. Moody's de Mexico and Standard & Poor's rated the deal triple-A on their respective national scales. Traditional pension funds snapped up nearly half the deal, while the rest went to insurance companies, a couple of corporate pension funds and bank-managed funds, according to a source close to the deal.

While the book was two times oversubscribed, foreign investors - which have swooped down on local RMBS issued by private-sector originators - kept away. Indeed, offshore money has yet to trickle into an Infonavit deal. One source familiar with the agency suggested he knew why: "In its last transaction in October, there was international demand, but [foreigners] didn't buy in because of the pricing." That still might hold true; the current deal came to about 130 basis points over the government benchmark.

Infonavit's last transaction was in October, when it placed a 20-year RMBS worth 294 million UDIs at 5.9%.

The agency expects to churn out 375,000 mortgages this year, the source said. Infonavit has experienced unprecedented growth in the last five years and is expected to remain on a fast track for the foreseeable future, feeding a voracious appetite for new housing among low-to-middle income Mexicans.

Elsewhere in Mexico, the municipality of Aguascalientes priced a Ps100 million ($9.5 million), five-year final securitization of federal co-participation revenue, which comprise payments the central government distributes to states and municipalities. The sole arranger was local brokerage Monex.

Retail investors from Aguascalientes snapped up roughly half of the transaction, which was sold through local Monex branches, according to a source close to the deal. "We could sell as little as 100,000 pesos," he said. The rest went to investment funds in Mexico City and retail investors outside the state of Aguascalientes, where the same named city is capital. The proceeds of the bond, rated triple-A on the national scale of Moody's and S&P alike, were to finance infrastructure projects.

The securitization is Aguascalientes' third. The city is named after subterranean hot springs found in the area.

Up ahead in Mexico is a credit card deal from first-time issuer Spira, which provides Visa cards to lower income consumers, according to a source close to the deal. With Mexico's Invex financial group and Central America's Banco Uno as shareholders, the originator aims to tap the markets as early as this week for around Ps150 million, though the exact size has yet to be determined. Unsurprisingly, the brokerage arm of Invex is the arranger.

The deal is a departure from the usual credit card ABS from emerging markets in that vouchers are not the collateral. Instead, the bank will be collateralizing all the purchases made by a set group of cardholders, said the source close to the deal. The debut deal will have a short maturity of 18 months and is expected to garner a rating of BBB+(mex)' from Fitch Ratings. Once the bank gains the confidence of bond investors, it will push out bond tenors and probably fashion transactions that look more like traditional structures in the credit card sector, the source said.

The upcoming deal inaugurates a program totaling Ps2 billion. Launching operations only about two years ago, Spira has been growing by leaps and bounds. The company currently has about a quarter of a million cardholders, a 32% leap since September. Forecasts estimate half a million cardholders in a year.

Elsewhere in the peso market, Banco de Bajio has penciled in a deal for Dec. 22. Backed by loans to states and state entities, the transaction could reach Ps4.4 billion and has secured a preliminary rating of mxAAA' on the national scale from S&P. Final maturity is 16 years.

The deal signals the bank's premiere in the securitization arena. The collateral is comprised of loans to such subsovereigns as the states of Sinaloa and Durango and the city of San Luis Potosi. Other borrowers are state related companies like the water company of Sonora. The loans were originated from December 2002 to July 2005. They range in size from Ps100 million to Ps1 billion and in tenor from 12 to 15 years. S&P has given an average rating of mxAA' on the national scale to the underlying portfolio. The average weighted maturity is seven years.

Bajio uses other banks to channel these loans, including BBVA Bancomer, Scotiabank, and JPMorgan.

(c) 2005 Asset Securitization Report and SourceMedia, Inc. All Rights Reserved.

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