JPMorgan Boosts Investment in Brazil’s C6 Bank

C6 Bank, JP Morgan

J.P. Morgan Chase & Co. has boosted its stake in Brazilian digital bank C6 Bank from 40% to 46%.

The financial terms of the deal were not disclosed, Reuters reported Tuesday (Aug. 29), citing a statement released by the banks. This expanded investment comes after J.P. Morgan initially bought a stake in C6 Bank in June 2021. 

Since the initial investment, C6 Bank has seen significant growth, expanding its number of clients from 8 million to 25 million, according to the report. The bank has also introduced new products, such as auto loans, to its offerings. The credit portfolio of C6 has also seen a substantial increase, rising from 9.5 billion ($1.95 billion) reais to 40 billion reais ($8.24 billion). 

However, C6 Bank posted a loss of 2.2 billion reais  ($453 million) last year due to increased provisions for credit losses, the report said.

C6 Bank was valued at 11.3 billion reais in December 2020 (about $2.28 billion at the time), six months before the initial deal with J.P. Morgan, per the report. The bank had raised capital from private investors at that time.

Sanoke Viswanathan, J.P. Morgan’s CEO of international consumer banking, said in a Tuesday press release posted by C6 Bank, translated from the Portuguese by Google: “Our strategic investment in C6 Bank is an important part of J.P. Morgan Chase’s global digital banking strategy. The rapid growth in customers, products and balance sheet demonstrates the success of C6 Bank’s approach. We are happy to reinforce our commitment to this partnership.”

C6 Bank CEO Marcelo Kalim added in the release, per the translation: “After two years of collaboration, we made the joint decision to expand this relationship. The two banks have already been working together to develop new products. We will increasingly work together to bring benefits to our customers.”

When J.P. Morgan took its initial 40% stake in C6 Bank in June 2021, the firm noted the size of the Brazilian market and the fact that it had seen new levels of digital adoption as the country underwent regulatory reform and modernizing of its infrastructure.

More recently, in October, it was reported that C6 Bank was preparing to open its first brick-and-mortar operations in a bid to attract wealthier clients in the market.