Best FIG borrower – Latin America: Nafinsa
The Mexican bank has been an impressive innovator in project finance.
Borrowing is always a means to an end. Which means that, in its own low-profile way, Mexican development bank Nacional Financiera, or Nafinsa, is the best financial-sector borrower in Latin America.
Nafinsa is one of four Mexican development banks but is the only one that owns broker-dealers in New York and London. Indeed, although Nafinsa’s primary purpose is to provide funding to small and medium-size companies in Mexico, it also acts as the Mexican government’s in-house investment bank.
Nafinsa will support companies and projects in any way it can. It does so with cash, of course: this year it intends to disburse $15 billion in both pesos and dollars to more than 500,000 Mexican companies. It will also provide loan guarantees for up to half the value of loans that companies take out. And it has extensive technical assistance and training programmes.
Nafinsa’s funds are broadly sourced. It borrows directly from the World Bank and the Inter-American Development Bank; in fact, it is the largest borrower in Mexico from both of those institutions. It also borrows on the interbank market domestically, and occasionally issues long-term debt when swap rates are attractive.