Fitch Affirms INFONAVIT's IDRs at 'BBB+'/'A-'; Outlook Stable

Fri May 9, 2014 1:03pm EDT

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(The following statement was released by the rating agency) MONTERREY, May 09 (Fitch) Fitch Ratings has affirmed the ratings for Instituto del Fondo Nacional de la Vivienda para los Trabajadores (INFONAVIT) as follows: --Long-term foreign currency Issuer Default Rating (IDR) at 'BBB+'; --Long-term local currency IDR at 'A-'; --Short-term foreign and local currency IDRs at 'F2'; --Support rating at '2'; --Support rating floor at 'BBB+'; --National scale long-term rating at 'AAA(mex)'; --National scale short-term rating at 'F1+(mex)'. The Rating Outlook is Stable. IDRS AND NATIONAL SCALE RATINGS KEY RATING DRIVERS INFONAVIT's IDRs remain aligned with the sovereign's and reflect the high probability that the entity will receive support from Mexico's federal government if needed, although there is no explicit guarantee. The ratings also consider the high importance of INFONAVIT as the main mortgage lender in Mexico. RATING SENSITIVITIES Any movements on the sovereign rating, which currently has a Stable Outlook, would trigger changes to INFONAVIT's IDRs. INFONAVIT's ratings could change (reflecting its intrinsic financial profile) if Fitch perceives a decrease in its strategic importance to the federal government. In Fitch's view, this scenario could take place only over the medium term, once the housing deficit in Mexico is fulfilled. SUPPORT AND SUPPORT RATING FLOOR KEY RATING DRIVERS Fitch affirmed INFONAVIT's Support rating and Support rating floor at '2' and 'BBB+', respectively, given the entity's role in Mexico. Fitch's support rating floors indicate a level below which the agency will not lower the entity's long-term IDRs as long as the assessment of the support factors does not change. RATING SENSITIVITIES A potential upgrade or downgrade of INFONAVIT's Support rating and Support rating floor would be driven by a change in Mexico's sovereign rating and/or a change in the expected propensity of support from the Mexican government. CREDIT PROFILE INFONAVIT was created by the Mexican government in 1972, as an autonomous entity with fiscal authorities focusing to provide housing solutions specially to low income workers in the private sector. The institute is also part of the National Pension Fund System (SAR) since 1992. As of December 2013, INFONAVIT's gross loan portfolio amounted MXN 917,790.7 million (USD 70,186.3 million), and it was integrated for 4.2 million of loans. Contact: Primary Analyst Gilda de la Garza Associate Director +52 818 399 9160 Fitch Mexico S.A. de C.V. Prol. Alfonso Reyes 2612 64920 Monterrey, Mexico Secondary Analyst Alejandro Garcia, CFA Senior Director +52 818 399 9146 Committee Chairperson Franklin Santarelli Managing Director +1-212-908-0739 Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: elizabeth.fogerty@fitchratings.com. Additional information is available on www.fitchratings.com Applicable Criteria and Related Research: --'Global Financial Institutions Rating Criteria' (Jan. 31, 2014); --'National Ratings Criteria' (Oct. 30, 2013). Applicable Criteria and Related Research: Global Financial Institutions Rating Criteria here National Scale Ratings Criteria here Additional Disclosure Solicitation Status here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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