After years of delays, Mexico's mortgage-backed securities market may finally be ready for launch thanks to the government's efforts to diversify funding for the housing sector, said Jose Ramon Tora, a director in Standard & Poor's Ratings Group structured finance group.

Several of the country's 14 nonbank banks (sofoles) responsible for lending to real estate developers are rapidly developing mortgage-backed transactions ranging in size from 20 million pesos ($2 million) to 1 billion pesos ($100 million), Tora said. The first of these deals to hit the market will probably be a 40 million-peso inflation indexed bond sold by Hipotecario Nacional, the largest of the nonbank institutions.

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