Nacional Financiera: Mexico’s Industrial Development Bank

Mexico has a long tradition in development banking dating back to the mid-1920s and early 1930s when the State put in place the pillars of its monetary, banking and financial intermediation systems. A landmark in this institutional building process was the creation of Nacional Financiera (NAFINSA) in 1934. Initially, NAFINSA served to manage a variety of assets the government had acquired from various sources and later in 1940 became the government’s development bank with the aim of providing long-term credit for infrastructure and for major investment projects aimed at boosting the fixed capital stock necessary for Mexico’s long-term economic expansion and social progress. This entry analyses the evolution of NAFINSA between 1940 and the present day distinguishing four different stages: (i) the golden age of development banking and NAFINSA (1940–1970), (ii) the collapse of the “developmentalist model” (1976–1982), (iii) the decline of development banking, under the neoliberal policies (1990–2020) and (iv) the possible revival of development banking.