Mexico's Su Casita closed a Ps525 million ($47.6 million), 25-year final deal last week that marked the birth of the fixed-peso RMBS market for private sector originators.
"We're moving towards international standards," said Mark Zaltzman, deputy head of corporate finance at Su Casita. Until now, all the RMBS by private sector originators were in inflation-indexed units (UDIs), reflecting the denomination of most mortgages in the country. Only state agency Infonavit had issued fixed peso RMBS before Su Casita. Zaltzman said that future issuance will more or less mirror origination; given that the originator is churning out one fixed peso mortgage for every three UDI mortgages, it likewise plans to have a fourth of its RMBS issuance in fixed pesos.
With Credit Suisse as sole lead, the deal priced at 10.15%. Fitch Ratings, Moody's Mexico, and Standard & Poor's rated the transaction triple-A on their respective national scales. Enhancements included overcollateralization and a liquidity facility from the International Finance Corp. for up to 12% of the outstanding volume of issuance. The expected maturity is 12 years and duration is eight.
Zaltzman said Su Casita would like to issue between $250 million and $400 million of RMBS this year. He added that the originator is in discussion with a monoline to secure a wrap for a transaction backed by construction bridge loans.
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