NEW YORK - While it has yet to get off the ground, Mexico's MBS market - or rather talk of it - can already draw a crowd in New York. At Moody's Investors Service 4th annual Latin American Securitization Briefing, attendance at a session devoted to the embryonic asset class spilled out into a hallway of the Sofitel Hotel. "It's very ripe for securitization," said Susan Romo, vice president at Credit Suisse First Boston, channeling a sentiment clearly shared by others in the room. With 700,000 new households added to the stock every year and a still-low residential mortgage rate of 12.6%, the potential for MBS in the country runs deep.

On the domestic side, housing finance companies known as Sofols have already securitized bridge loans for construction, but an MBS with a true sale of loans has yet to surface. Banorte nudged the market in that direction on Sept. 23 by closing a Ps340 million (US$31 million) transaction backed by cash flows from mortgages originated by Banca Serfin in the late 1980s, but it's not quite the real deal.

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