Nubank Repriced Its Loan Book Faster Than It Seasoned, and the Market Called It 'Seasonality'

In the three months to June, Nu Holdings earned a wider spread after credit losses than at any point in its thirteen-year history. Risk-adjusted net interest margin — net interest margin after expected credit losses, the number that actually determines whether a lender's growth is worth anything — reached 12.4%, up from 9.5% in the March quarter, while headline NIM expanded 180 basis points to 22.9% and cost of credit fell 9% sequentially to $1.7 billion . Net income crossed a billion dollars for the first time, at $1,061 million, on a 33% return on equity . And the stock, at $15.37 at the September 4 close, sits 19% below the $18.98 high it set in late January and barely a third of the way back from the $11.20 low it printed in early June .

That gap is the argument. Nu is the largest digital bank in Latin America by its own reckoning, serving 139 million customers across Brazil, Mexico and Colombia through a single mobile app with no branch network . It earns money three ways — interest on a credit-card and lending book, float on the deposits funding it, and fees — and in the June quarter those contributed 41%, 34% and 25% of gross profit respectively, all three growing in absolute dollars . The contested question is narrower than the franchise: whether the 290-basis-point step-up in risk-adjusted spread is a durable consequence of a deliberate shift into unsecured lending, or the flattering top of a Brazilian consumer-credit cycle that provisioning will claw back. The market has settled on the second reading. The disclosed arithmetic does not support settling on it.

What the Spread Bridge Actually Separates

Management published the decomposition, and it is more useful than the headline. Of the sequential expansion in risk-adjusted NIM, credit income contributed 178 basis points — the revenue matriculation of loans originated in the prior two quarters, reflected in a loan-to-deposit ratio that has climbed hard off its 2025 base — while lower cost of credit contributed a further 115 basis points, the majority of that from ordinary second-quarter seasonality rather than one-time items. Desenrola, the...