Aug. 7 (Bloomberg) -- Argentine mortgage lender Banco Hipotecario SA plans to sell bonds this month to raise funds for a government-sponsored home loan program, bank president Eduardo Elsztain said.

The bond issue would provide financing for a second round of home loans first announced by President Cristina Fernandez de Kirchner and Elsztain in May. The government has so far tapped pension funds nationalized last year by the social security agency, known as Anses, to help Argentines buy or build new homes over the next two years.

“We are going to go to the voluntary market in the next 15 days to sell the first bond to be able to continue with this home financing policy,” Elsztain said in a telephone interview in Buenos Aires. He declined to provide details about the sale. “Demand is very strong” for home loans, he said.

The bank received hundreds of thousands of inquiries and has issued thousands of mortgages, he said. Hipotecario is lending for periods of 15 to 20 years at rates of 14 percent for new home construction and 18 percent for existing homes, he said.

The government owns about 60 percent of Banco Hipotecario, with private shareholders controlling the management through triple-vote shares, said Elsztain, who is also chief executive and founder of IRSA Inversiones y Representaciones SA, Argentina’s biggest real estate developer.

Under a program to be announced next week, “government directors will be more participatory” in Hipotecario, Elsztain said. He declined to provide details.

A spokesman for the Economy Ministry had no immediate comment.

To contact the reporter on this story: Drew Benson in Buenos Aires at abenson9@bloomberg.net

Last Updated: August 7, 2009 10:22 EDT