Brazilian digital bank Nubank is reportedly planning to launch its initial public offering (IPO) on the New York Stock Exchange next month.
The digital lender aims to raise nearly $3bn in its IPO on 9 December 2021 at a valuation of $50bn, AFP has reported.
A $50bn valuation will put Nubank ahead of the country’s established traditional lender Itau Unibanco Holding.
Founded in 2013, the fintech caters to nearly 40 million customers and counts Warren Buffett’s Berkshire Hathaway, Sequoia, Tencent, Dragoneer and Ribbit among its backers.
In June this year, Berkshire Hathaway invested $500m in the digital bank as part of its Series G extension.
Nubank offers fee-free online accounts, credit cards, loans, insurance, and investment products to the vast underbanked population.
Nubank has operations in Brazil, Colombia, and Mexico and its current valuation stand at $30bn.
“Digital banks, and Nubank in particular, have a greater capacity to quickly include people who would otherwise be unbanked,” finance professor Rafael Schiozer of the Getulio Vargas Foundation was quoted by AFP as saying.
There are concerns as well that the digital bank could face competition from traditional peers and regulatory hurdles.
Brazilian banking association Febraban has pointed out that regulatory “asymmetries” could “distort competition” and give neobanks such as Nubank an unfair edge over their traditional competitors.
Rubens Sardenberg told AFP that “the regulatory framework needs to adjust.”