S&P upgraded Nubank Brazil’s rating to brAA+ with a stable outlook. The key factors mentioned for the decision were the increase in financial margins and operational efficiency, and the stabilization of the company’s asset quality despite market deterioration. 

Also featured in this issue of our corporate newsletter: Nu grows its insurance portfolio and diversifies options to collateralize loans, among other news. 

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S&P Global Ratings upgraded Nubank Brazil’s rating from brAA to brAA+ with a stable outlook. The decision was based on the company’s consistent improvement of operational trends, as reinforced by our most recent Q1’23 financial results. The rating agency highlights Nubank’s strong capitalization (Basel Index in Brazil of 18.7%) and efficiency ratio (39% in Q1’23), which position the company as one of the most efficient and well-capitalized players in Latin America. The company also registered a robust liquidity position, with a 33% loan-to-deposit ratio in Q1’23. 

“As a result of portfolio growth and its mix with a greater focus on higher profitability products, Nubank has been demonstrating an increase in its financial margin and revenues. This, coupled with better cost control, has allowed for an improvement in its operational efficiency”, write the analysts.

S&P also anticipates further improvement in financial results throughout 2023 and 2024 and expects the company to continue to outperform in the industry. “[Nubank] is expected to maintain its leadership in the digital banking segment and diversify its revenue sources, combined with the gradual monetization of its customer base."

Insurance portfolio expansion. Nubank has recently launched two new products to help plan for unforeseen events. Vidas Juntas allows customers to contract their own life insurance and gift another Nu customer with a second individual policy. And Parcela Segura (lender’s insurance) covers personal loan installments in case of income disruption due to formal job loss or accidents resulting in disability or death. 

New option for secured lending. It’s now possible to use investments in Tesouro Direto (a type of government bond in Brazil) to secure loans. The new collateral option is another way for the company to offer credit responsibly while the customer’s investments continue to yield.

Partnerships. Nubank has recently announced three deals with companies to unlock further portfolio expansion and offers for customers. 

• Brazilian payments fintech EBANX will make NuPay available to more than 1,600 companies all over the world. NuPay is a feature for online purchases that directs the customer to conclude the payment in Nubank’s app, without the need to share credit card data with the merchant.
• A contract with US-based Fireblocks provides Nubank's engineering team working on Nubank Cripto with a resilient and scalable infrastructure to go further in creating innovative blockchain products and securely managing transactions involving crypto assets. 
• Amazon is the newest seller available at Nubank Shopping. The partnership started on Prime Day with special discounts. 

Financial education. Nubank and Brazilian toy company Estrela relaunched the classic Game of Life (“Jogo da Vida” in Portuguese) with a twist. In the new limited version, “Jogo da vida Nu”, players can compete and have fun while learning about financial education with Nubank products.

The Strongest Brand. Nubank was recognized for the second time in a row in the ranking of Most Valuable Brands in Brazil 2023, by Design Bridge and Partners (a WPP company) in partnership with IstoÉ Dinheiro magazine and consulting firm TM20 Branding. The company topped the Strongest Brands category, which considers differentiation and relevance attributes.

Executives in the spotlight. 

• Jag Duggal, Nubank’s CPO, published an article on LinkedIn about leading fintech innovation and success happening in the global South. He mentions Nubank’s fast growth as an example, reaching a higher market cap than five of the trendiest fintechs that also went public in 2021, combined.
• David Vélez, founder and CEO, is #1 on the list of CEOs Change Makers América Latina (link in Spanish). The study, by the Argentinian consultancy Horse, analyzed each CEOs’ reputation in aspects like innovation, sustainability, and D&I.
• Iván Canales, Nu Mexico General Manager, was considered one of the most important leaders in Mexico's financial sector by the magazine Líderes Mexicanos.

• “Brazil's Nubank Is Leaving U.S. Digital Banks In The Dust”, reads a Forbes US headline. Based on interviews with founders David Vélez and Cris Junqueira, the article compares Nu’s well-executed credit-first approach to US fintech’s focus on debit through partnerships with traditional banks.
   
• David analyzed what the US could learn from the Latin American fintech ecosystem in an in-depth interview with TechCrunch’s Equity podcast. In Axios, he also gave an overview of our business strategy and insight into some of the company’s decisions throughout these first 10 years.
   
• Livia Chanes, Country Manager of Nu in Brazil, spoke to Exame about the strategy to grow in the business account segment (PJ). She highlighted the large potential to attract Nubank’s individual customers who are entrepreneurs to trust the company with their business’ financial lives.
   
• A new report by Itaú BBA recognizes Nubank’s “maximum speed” growth in customer monetization. The analysis highlights our connection to customers and innovation as the fuel for expansion through a challenging macro scenario.
   
• The partnership between Nu and EBANX unlocks international payments with NuPay for major companies who use EBANX services, highlights Reuters.
   
• Nubank is the financial institution that receives by far the most Open Finance data in Brazil, which increases knowledge about customers and allows for a deeper understanding of the base, with improved analyses and better-suited products for them. Valor points out that we were the receivers in 46% of all requests made until the end of May. 
   
• Digital banks have higher rates of customer satisfaction and trust compared to incumbent institutions, shows new country-wide research about the use of credit cards in Brazil. Nubank was highlighted for its above-industry NPS.
   
• Eduardo Lopes, Nubank’s Global Director of Public Policy, is the new president of the fintech association Zetta. With the goal of bringing digital financial institutions to relevant country-wide discussions about banking, Zetta has just completed two years old and has over 30 associates. “We want to position ourselves as part of the conversation with quality, technical approaches and bringing new perspectives”, he said in an interview with Valor. 

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