Financial advisors eye NHMFC P40-B mortgage auction

A total of 30 local and foreign trust and investment institutions have signified their interest to provide financial advisory services in the disposition of some P40 billion in mortgages by the National Home Mortgage Finance Corporation (NHMFC).

The interest shown by financial advisors who attended the first pre-qualification meeting called by NHMFC raised hopes for the planned liquidation of the agency’s mortgage portfolio holdings and the infusion of liquidity into government housing finance from the mortgage disposition, according to Lawyer Angelico T. Salud, NHMFC president.

The financial advisors, to be chosen through public bidding, shall assist NHMFC in the liquidation of mortgages the latter is currently administering, under the most feasible and advantageous schemes, Salud informed.

More particularly, the advisor shall design a program that will yield the highest liquidation value for the NHMFC mortgages, which is either or a combination of outright sale, securitization, assignment of assets to another company, or through other modes of disposition, he pointed out.

In case of outright sale, the advisor shall develop appropriate terms and conditions; establish the benchmark values that will be applied in screening investors or buyers of mortgages; including the setting up of the methodology for the mortgage valuation, mode of disposition and mechanics of sale.

However, in case of securitization of mortgages, the advisor shall develop or structure the appropriate instrument or securities that will be issued, including the vehicle with which to execute the securitization program, as well as assist in the selection of entities that will be involved, Salud explained.

Among those who attended the pre-qualification meeting are representatives of Lehman Brothers Asia Holdings; Goldman Sachs; Shearman & Sterling; Security Bank Capital Investment Corp.; BPI Capital; Credit Suisse First Boston; Landau Capital/First Metro; Equity Managers Asia, Inc.; Force & Ventures, Inc.; PKF Hawaii, LLP; Corporate Access Holdings, Inc.; Morgan Stanley Dean Witter Asia, Ltd.; PriceWaterhouse Coopers Securities; P&A Ernst & Young International; and others.