Press Release

OPIC Provides $10 Million for Low-income Mortgages in NIcaragua

May 14 2007

CIUDAD SANDINO, Nicaragua – Robert Mosbacher, Jr., President and CEO of the Overseas Private Investment Corporation (OPIC), today signed a loan agreement providing $10 million in OPIC financing to a leading bank in Nicaragua.  This loan will enable the bank to expand mortgage lending to low-income borrowers, a segment of the Nicaraguan population that has traditionally lacked access to bank financing.

 The OPIC loan will enable Banco de Credito Centroamericano (Bancentro) to expand its mortgage financing operations to underwrite a portfolio of 20-year residential mortgage loans for low-income borrowers. With the OPIC loan, Bancentro will become the first provider of long-term, fixed rate mortgages in Nicaragua.

 Mosbacher signed the agreement with Bancentro President Roberto Zamora, who is a U.S. citizen.

 OPIC had previously signed a $20 million loan agreement with Mr. Zamora to expand mortgage lending to middle-income borrowers in August of 2006.  This puts the total OPIC commitment to the Nicaraguan mortgage market at $30 million.

 Also today, Mosbacher joined Zamora at a ribbon-cutting ceremony for the San Andres housing project in Ciudad Sandino, designed to construct more than 1300 homes for low- and moderate-income Nicaraguans. Bancentro is using OPIC supported funds to offer long-term, affordable mortgage financing at San Andres for working Nicaraguans to achieve the dream of home ownership.

 The San Andres homes follow one of two models: one with two bedrooms and one bathroom, the other with three bedrooms and two bathrooms. The project will also support local infrastructure, through construction of roads and provision of utilities, as well as retail development in the area, and be a catalyst for job creation in the area.

 “OPIC’s partnership with Bancentro is proof that the private sector can help drive both the construction of housing capacity and the financing of home purchases in a price range that is affordable, and on mortgage terms that are affordable,” Mosbacher added. “As evidence of this, the San Andres housing project demonstrates that access to low- and moderate-income housing is not just a part of the American Dream, but an achievable part of a universal dream.”

 “Supported by OPIC loans, Bancentro is the first Nicaraguan bank to extend affordable mortgage financing to segments of the Nicaraguan population that have traditionally lacked it – low-income borrowers,” Zamora said. “This project represents an important first step toward the development of Nicaragua’s mortgage finance infrastructure. It will also result in improved social infrastructure, in the form of new or improved roads, water, and sanitation.”

Mosbacher noted that fewer than 2000 housing units are built each year in Nicaragua, a country with a housing deficit of more than 500,000 homes. 

OPIC/Bancentro Middle-income Mortgage Lending Facility
OPIC in August 2006 approved a $20 million loan to enable Bancentro to finance fixed-interest mortgages for middle-income Bancentro customers, the bank’s traditional customer base.

OPIC/Bancentro Low-income Mortgage Lending Facility
OPIC in May 2007 approved $10 million in additional financing for a new credit facility enabling Bancentro to expand its residential mortgage program to include longer-term, fixed interest mortgages for lower-income households.

OPIC was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers.

OPIC’s political risk insurance and financing help U.S. businesses of all sizes invest in more than 150 emerging markets and developing nations worldwide. Over the agency’s 35-year history, OPIC has supported $164 billion worth of investments that have helped developing countries to generate more than 732,000 host-country jobs and $13 billion in host-government revenues. OPIC projects have also generated $69 billion in U.S. exports and supported more than 264,000 American jobs.

Visit OPIC on the web at www.opic.gov.