Nubank’s financial statement: twice as many customers and BRL 19 billion cash

Marcelo Kopel, Nubank's CFO, comments on the financial statement for the first half of 2020 - a period when we focused on supporting our more than 26 million customers during the pandemic and ensuring the well-being of our employees.

In 2020, Nubank had the privilege of being extremely well-capitalized, having a robust business and resilience to face a challenging global landscape. 

Thanks to our solid model, we could support our employees and customers by taking action since the pandemic’s onset in the country. 

We were one of the first companies to send all our teams, about 2,700 people, to work remotely on March 12, providing the necessary resources so they could work in good conditions. We sent computers, monitors, keyboards, and even ergonomic chairs to the homes of more than one thousand Nubankers. 

On March 24, we launched the People First movement, allocating approximately BRL 20 million to provide food, basic needs, medical assistance, and psychological support to our customers most affected by the pandemic. 

In addition to that, we offered special refinancing conditions for credit card bills and personal loan payments, with lower interest rates and extended payment deadlines. And we were the fifth largest institution distributing the emergency aid, enabling more than half a million people to receive that money in a much easier, simpler way, and with no fees.

Our result and financial statement reflect those efforts and show that Nubank’s model remains solid even in such an uncertain scenario. 

The financial statement includes all entities of Nubank group in Brazil, in the first semester of 2020. I will comment on the highlights below. 

Nubank’s Financial Statement 2020: Our Model Remains Strong

The first half of 2020 demonstrates that Nubank keeps growing exponentially, with healthy finances and increasingly better-operating results. 

  • Solidity: BRL 19.9 billion cash – 48% increase (December 2019). 
  • Trust: 54% increase in the volume of transactions comparing to the same period in 2019.
  • Healthy finances: our financial intermediation revenue more than doubled compared to the first semester of 2019 – it was BRL 2.079 billion
  • Growth: 26 million customers, more than twice as many as we had last year. 

Our figures prove we have become more and more a part of people’s financial lives: the deposit balance of the first semester (June 30), considering withdrawals, is BRL 17.3 billion (60% higher than in December 2019). 

That made us close the first semester of 2020 with more than BRL 19.9 billion cash, a 40% increase compared to December 2019 – another record in Nubank’s history. 

Our positive results are a consequence of our growth, which remains accelerated despite the pandemic. Our customer base more than doubled in the last 12 months – from 11 million to 26 million, an average of 41,000 new customers per day

Our teams also grew stronger, with 12% more employees than in December 2019, totaling 2.720 Nubankers at the end of June. 

Increasingly Better Operating Results

Nubank’s revenue from financial intermediation more than doubled: BRL 2.079 billion this semester, a 104% increase compared to the previous period (BRL 1.018 billion in June 2019).

Net loss was BRL 95 million in the semester, 32% better compared to the same period in 2019.

We have already mentioned it before, but it’s worth highlighting it here: loss is a decision; therefore, it is expected as part of our current growth strategy. 

We chose to invest in the company, in people, and in developing new technologies to continue delivering the best experience to our customers. That model is well-known and widespread in the technology industry. 

In short, our operating revenue keeps increasing at a faster pace than our expenses, and our operating cash generation remains solid and on a rising trajectory. This enables us to carry on with our growth strategy – with a capitalization level compatible with our business’s development.

Below-Average Default Rate

Like the entire industry, we increased our provision for credit-risk related losses due to the Covid-19 pandemic. At Nubank, we increased it by 16%. 

Possibly because of the financial education features in our app and the transparent relationship we’ve built with our customers, our default rate was relatively low (5.8%) and below the industry average. According to the Central Bank, the 90+ days delinquency rate was 7.5% in June 2020. 

The pandemic impacted the volume of credit card purchases at the initial stages of quarantine in Brazil. At the end of the semester, however, the transaction flow went back to the previous level, and the traded volume in credit card purchases was 54% higher comparing to the first six months of 2019. 

Nubank managed to increase its revenue despite that momentary drop in transactions – thanks to our teams’ agility. 

Since the beginning of the crisis, we’ve been monitoring the pandemic effects every day, creating internal communication channels, improving our controls, considering new scenarios, and – above all – listening to our customers. 

By listening to the feedback of more than 26 million Nubank customers, we can continue building products and services that really make the difference in people’s lives. We keep on our mission, stronger and stronger.

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