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FND offers 2.3B Mexican pesos; Banobras warns credit will get more expensive

Financiera Nacional de Desarrollo Agropecuario Rural Forestal y Pesquero, or FND, placed 2.3 billion Mexican pesos in credits in the Mexican state of Nuevo León in 2016, according to a report in El Economista.

In 2015 the Mexican development bank placed 2.1 billion pesos and according to an official of the bank, FND plans to increase the credit by 15% in 2017.

The official said that the bank would sign an agreement with the state government of Nuevo León to increase the goat population in the region, which is one of the state's main consumer products.

Alfredo Vara, CEO of Banobras, Banco Nacional de Obras y Servicios Públicos S.N.C, another state-run Mexican development bank, told El Economista separately that credits are likely to get more expensive with an expected hike in interest rates, which ultimately would mean a reduction in projects financed by the bank.

Still, the executive said that the government wants the bank to focus on profitable projects and by doing so, preventing a reduction in investments.

Vara said that Banobras, which is the biggest development bank in Mexico, with a credit portfolio of 505 billion pesos, will offer about 95 billion pesos in credit in 2017, an increase of 10% from last year, the report noted.

The executive told the publication that the bank has the next 10 to 30 years in mind when making investment decisions, and he is confident that the current economic troubles are only temporary.

As of April 7, US$1 was equivalent to 18.69 Mexican pesos.