Structured Finance in Latin America : Channeling Pension Funds to Housing, Infrastructure, and Small Business

by Cheikhrouhou, Hela; Gwinner, W. Britt; Pollner, John D.; Salinas, Emanuel; Sirtaine, Sophie

• ISBN13: 9780821371398
• ISBN10: 0821371398
• Format: Paperback
• Copyright: 2007-07-01
• Publisher: World Bank

Summary

Structured Finance in Latin America explores how structured finance mechanisms can channel pension savings to support projects in underserved sectors, deepen capital markets, and contribute to investment and economic growth. Private pension funds have been accumulating assets rapidly in the wake of pension system reforms in many Latin American countries. Strict investment regulations to protect workers' savings have limited their investment in highly creditworthy domestic securities, yet pension fund demand for new securities has outstripped issuance of eligible traditional corporate debt instruments. This has contribute to a high concentration of pension fund assets in public debt.

Table of Contents

Acknowledgments	p. xi
Executive Summary	p. xiii
Abbreviations	p. xxvii
Investment Management of Defined Contribution Pension Funds and the Role of Structured Bonds	p. 1
The Issues	p. 1
What Determines Pension Fund Growth in Latin America?	p. 3
What Determines Pension Fund Asset Allocation?	p. 6
Interdependence of Defined Contribution Pension Systems and Domestic Capital Markets and the Momentum for Structured Finance	p. 23
The Way Forward	p. 28
The Enabling Role of Adequate Securitization Instruments	p. 29
Notes	p. 32
References	p. 34
Structured Finance for Housing	p. 37
Housing and Housing Finance	p. 38
Motivations for Issuing Mortgage Securities	p. 42
Links to Broader Fixed-In come Markets-Repurchase Agreements and Mortgage-Related Securities	p. 44
Risks of Mortgage Securities	p. 44
Steps to Make Securitization Feasible	p. 46
Notes	p. 55
References	p. 56
Structured Finance for Infrastructure	p. 59
Why Infrastructure Financing Has Dried Up	p. 60
Public-Private Partnerships for Infrastructure Financing	p. 62
The Capital Markets: An Alternative Source of Financing for Infrastructure?	p. 64
Pension Fund Regulation and Infrastructure Investments	p. 68
Further Mobilizing Private Capital	p. 70
The Way Forward	p. 80
Notes	p. 80
References	p. 81
Structured Finance for SMEs	p. 83
SMEs in Latin American Economies and Their Limited Access to Finance	p. 84
Securitization to Enhance the Financing of SMEs	p. 87
Government Support for SME Loan Securitizations	p. 100
The Way Forward	p. 103
Factoring in Latin America	p. 106
Leasing in Latin America	p. 111
MFI Loan Securitization: Groundbreaking Transactions	p. 116
Notes	p. 116
References	p. 120
Asset Securitization	p. 123
Statistics on Financial Markets in Latin America and Selected Comparator Countries	p. 131
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