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Citing the housing sector as “a catalyst for the economy,” BBVA México plans to expand its mortgage loan book this year, committing to place 30,000 home loans for which it has allocated more than 62bn pesos (US$3.1bn).
“In 2021, [BBVA] will seek to continue as a leader in the segment, holding first place in the areas of placement, number of mortgages in the market, total volume of portfolio balance and co-financed loans,” the bank said in a statement.
CEO Eduardo Osuna highlighted the resilience of the mortgage segment, identifying it as a major driver for the reactivation of the economy amid the COVID-19 pandemic.
The bank reported placing 30,400 mortgages in 2020, adding 44bn pesos to its loan book, after lowering the interest rate it offers to payroll account clients to 7.90% in July.
“In this way, BBVA México places one out of every four mortgages on the market and has a market share of 22.5%,” said the bank in a statement.
The mortgage market has seen a surge in competition over the last year, with Santander introducing a market-low rate of 7.75% for qualifying clients (largely based on brand loyalty), and Banorte recently expressed hopes to see solid growth in the segment in 2021.
Bank regulator CNBV data for December 2020 shows housing loans expanding 5.5% year-on-year – the only large segment to show growth, compared to business loans (-5.4%), consumer loans (-11.4%) and credit cards (-14.2%).
Personal loans saw a particularly sharp decline in 2020, falling 20.7% to 162bn pesos.
BBVA México said that of the 62bn pesos,18bn pesos will be bridge loans to the construction sector, giving builders an additional injection of capital this year along with funding from the federal government’s multi-billion dollar national infrastructure PPP initiative (PNI) and broader efforts to reactivate the economy.
Gabriel Ramírez Landa, general director of business, government, auto and mortgage banking at BBVA México, said the bank is working to maintain its position as a leader in digital transformation, opening up digital channels to the real estate market and offering self-service options to clients in their efforts to purchase housing.
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