The International Finance Corp., a division of the World Bank, said last week that it has set up a $150 million fund to purchase Mexican mortgage-backed securities.

The fund, known as the Mexican Housing Finance Intervention Facility, is meant to avert liquidity problems in Mexico's mortgage market.

The IFC set up the fund in close collaboration with Mexico's state housing development bank, Sociedad Hipotecaria Federal.

The fund is authorized to purchase up to 15% of Mexico's mortgage securities to help offset a drop in demand for the securities.

"It aims to provide a comprehensive response to recent liquidity shortfalls in Mexico's residential mortgage-backed securities," the IFC said.

Since 2001 the IFC has invested $531 million to support Mexico's housing finance sector and to help expand access to mortgages for lower- and middle-income families.

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