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Reforms that help Mexico’s development finance institutions thrive (Chinese)

This Results Profile talks about the reforms that help Mexico’s development finance institutions thrive. A decade ago, Mexico’s development banks accounted for one-fifth of the total credit provided by the banking sector, yet their operations were often inefficient, ineffective and blighted by high costs and undue risks. The International Bank for Reconstruction and Development worked with the Mexican government to slim down the number of development banks and to make them more effective and accountable, thereby ensuring public funds were being well-targeted and efficiently used. Based on recommendations of the joint World Bank and International Monetary Fund Financial Sector Assessment Program in 2000, the Bank used new loans to transform development financial institutions. A Restructuring loan helped transform the Financial Housing Aid Fund into the Federal Mortgage Corporation, a well-respected and market engaged institution. Rural Finance Development Structural Adjustment Loan assisted in the liquidation of Banrural, an institution that introduced huge distortions in the rural finance markets, and instead established the Financiera Rural to provide financial services to small and mid-sized rural markets. Finally, a Savings and Rural Finance Loan helped with the transformation of Pahnal, an economic vehicle to invest small depositors’ savings in risk-free government instruments, into Bansefi, to provide cost pooling for technological development and a common marketing brand for cooperatives.

Details

  • Document Date

    2010/03/15

  • Document Type

    Brief

  • Report Number

    95257

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Mexico,

  • Region

    Latin America & Caribbean,

  • Disclosure Date

    2015/10/15

  • Disclosure Status

    Disclosed

  • Doc Name

    Reforms that help Mexico’s development finance institutions thrive

  • Keywords

    total credit;medium-sized enterprise;financial service;credit portfolio;financial crisis;access to financial service;rural finance market;financial plan;commercial bank;banking system;state ownership;public fund;banking sector;common market;technological development;small depositor;rural market;information base;housing finance;export sector;market development;mandatory participation;financial market;sustainable approach;

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Citation

Reforms that help Mexico’s development finance institutions thrive (Chinese). Results Profile Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/555631467987834125/Reforms-that-help-Mexico-s-development-finance-institutions-thrive