In a filing with the Mexican Stock Exchange, Credito y Casa said finance company ABC Capital SA bought all of its operating assets for an undisclosed sum.

ABC Capital is a subsidiary of ABC Holding, whose assets include a 51% stake in the finance arm of cement giant Cemex SAB (CX).

Credito y Casa also said it has reached a deal to pay its debts with Sociedad Hipotecaria Federal and a trust administrated by the development bank by using assets pledged as collateral under its financing agreements with both institutions.

Credito y Casa executives weren't immediately available for comment.

Credito y Casa up until recently was one of Mexico's largest nonbank home finance companies with 14.59 billion pesos ($1.12 billion) in loans at the end of March and a presence in 30 states, according to information published on the company's Web site.

A housing boom in the middle of the decade was one of the main reasons that retail and banking concern Grupo Coppel decided to acquire Credito y Casa in 2007 with a view to expand the group's presence in the mortgage industry.

Credito y Casa and another large home lender, Metrofinanciera, defaulted on debt earlier this year amid rising loan losses and difficulty in refinancing short-term liabilities as the country plunged into its worst recession since the 1995 peso crisis.

Nonbank lenders were particularly hard hit by the recession and market volatility because of their dependence on funding through the issuance of short-term debt and loans from Sociedad Hipotecaria Federal. Unlike banks, nonbank lenders are prohibited by Mexican law from taking deposits from the public.

Thanks to their access to cheap funding through retail deposits, banks have overtaken home finance companies as the main providers of private-sector mortgage financing in recent years