Program Details
Economy Minister Luis Caputo announced a program to boost mortgage credit in Argentina using funds from the ANSES Sustainability Guarantee Fund (FGS). The initiative involves bidding out $2 trillion pesos in fixed-term deposits to banks, with each auction worth $200 billion pesos. The first auction is scheduled for next week.[S1][S2][S3]
The program offers two deposit terms: one-year deposits with a minimum rate of UVA plus 2.50%, and five-year deposits with a minimum rate of UVA plus 4.50%. Banks can bid for up to 20% of the total amount per auction and have 90 days to use the funds for mortgage loans. The maximum rate for end borrowers is UVA plus 7.50%, with a minimum loan term of 15 years and a maximum amount of 150,000 UVA per loan.[S1][S2][S5]
Addressing a Structural Gap
Caputo highlighted that mortgage credit in Argentina represents only about 2% of GDP, compared to 27% in Chile and 75% in the United States. He attributed this to historical economic crises that eroded trust in institutions and the currency, preventing the development of long-term savings and capital markets.[S1][S3]
The program aims to solve the maturity mismatch banks face: they take short-term deposits but need to lend for 20 to 25 years. By providing long-term funding through the FGS, the government hopes to accelerate mortgage lending. Officials estimate the $2 trillion could finance housing solutions for 17,000 to 18,000 families.[S1][S3][S6]
Implementation and Supervision
The Central Bank will help organize the auctions and supervise that banks use the funds for mortgages as required. Baltasar Romero Krause, vice president of the Central Bank, said the institution will establish a reporting regime to monitor compliance. The FGS will not take credit risk on individuals; that remains the banks' responsibility.[S1][S3]
Caputo provided an example: for a home valued at $106,667, a family would need a net income of $3,460,391 pesos, with an initial monthly payment of $865,089 pesos. The loan would have a rate of UVA plus 7% over 25 years. He noted that payments would be similar to rent.[S3][S5]
