Mexican players say the first-ever MBS issued jointly in early December by housing finance companies GMAC Hipotecaria and Su Casita opens the door for smaller originators to similarly pair up. "I think we're going to see some couplings next year," said one Mexico City-based banker. "It makes the most sense for the smaller [lenders]."

In the Su Casita/GMAC deal, the former contributed 71% to the pool, the latter, 29%. GMAC is at the scrawnier end of the group of housing finance companies known as Sofoles. Prior to that transaction, heavyweights such as Credito y Casa, Hipotecaria Nacional and Su Casita had dominated issuance of structured transactions, with the asset class being bridge loans for construction.

According to the Sofol trade group, as of April 2003, Hipotecaria Nacional had Ps29 billion (US$2.6 billion) in assets, Su Casita had Ps14 billion (US$1.3 billion), and Credit y Casa held Ps12 billion (US$1.1 billion). GMAC, in contrast, had originated Ps918 million (US$82 million) at that point.

Despite predictions of future combinations among small Sofoles, Fincasa Hipotecaria is in the works with a stand-alone deal. Led by IXE Casa de Bolsa, the originator is eyeing the first quarter of 2004 to make its market debut. Totaling Ps1 billion (US$90 million), the program will probably be split into two equal issues, said a source familiar with the deal. The deal is a standard securitization of bridge loans for construction. Enjoying a partial guaranty from government agency Sociedad Hipotecaria Federal, the notes are rated mxAAA' by Standard & Poor's. As of April, Fincasa had assets of Ps2 billion (US$180 million), more than twice the size of GMAC, but still dwarfed by the sector top dogs.

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