Mexican RMBS Index: After A Lackluster 2013, Expectations Are Higher For Mexican RMBS In 2014
Download Document| Date Published | 2014 |
| Version | |
| Primary Author | Standard and Poor |
| Other Authors | |
| Theme | The Secondary Market |
| Country | Mexico |
Abstract
Following a sharp decline in economic growth last year, the Mexican residential mortgage-backed securities (RMBS) market is looking to make a comeback. During 2013, the Mexican economy's growth slowed to approximately 1.2%, affecting both job creation and disposable income for households, a negative for RMBS performance. In 2014, however, Standard & Poor's Ratings Services anticipates a better macroeconomic environment, with a GDP growth rate of more than 3% and stronger job creation, both of which are expected to positively affect transaction performance. On the other hand, challenges may come from the fiscal reform passed in January 2014 (which will negatively affect the disposable income of mostly middle- and higher-income households) and the performance of loans targeted to low-income borrowers, which will continue to be generally weak.