IIC Promotes Mortgage Market For Medium- And Medium-Low Income Segment In Panama And El Salvador
02/05/2007US$20 million in funding for La Hipotecaria S.A. and La Hipotecaria S.A. de C.V.
Washington, D.C.-On February 6, 2007, the Inter-American Investment Corporation (IIC) approved a loan of up to US$20 million to La Hipotecaria S.A. and La Hipotecaria S.A. de C.V. for financing the origination of mortgage-backed loans in Panama and El Salvador for subsequent securitization. The IIC loan will make it possible to build 800 housing units with an average price of US$25,000.
The construction sector is one of the main engines of economic activity for all countries in the region. By providing this support the IIC will help create and maintain jobs in El Salvador and Panama. The operation will improve the quality of life for medium- and medium-low income families by helping them purchase what is for most their first home and giving them the opportunity to move to a better neighborhood.
La Hipotecaria S.A., which began in Panama, has originated, serviced, and securitized mortgage-backed housing loans since 1977. Since then, the company has disbursed mortgage loans to more than 10,000 families with monthly incomes between US$400 and US$800. In 2003, La Hipotecaria (Holding) Inc. expanded its operations nationwide beyond Panama City. In 2004 it began to internationalize and started operating in El Salvador.
According to Carlos Roa, IIC Financial Institutions and Structured Finance Coordinator, "the IIC’s support should enable La Hipotecaria S.A. do another mortgage-backed securities issue in other capital markets and will have a valuable demonstration effect by attracting investors interested in other securitization projects. It will also promote the deepening of the region’s capital markets."
The Inter-American Investment Corporation is a multilateral financial institution that is a member of the Inter-American Development Bank (IDB) Group. It provides financing (in the form of equity investments, loans, guarantees, and other instruments) and advisory services to private enterprises in Latin America and the Caribbean. The IIC's mission is to promote the economic development of its regional member countries by encouraging the establishment, expansion, and modernization of private enterprises, particularly those that are small and medium in size. For more information on the IIC's activities, please visit www.iic.int.
Contact: Carlos Roa/Ana Cecilia Savastano (in Washington D.C.)
Telephone: (202) 623-3955