(Bloomberg) -- Brazilian financial-technology company Nu Holdings Ltd. is considering plans to shift its legal base to the UK, in a move that would mark a major win in Britain’s push to encourage more tech companies to move to the country.
The digital challenger bank has been working with the British government on the plans, which were discussed as part of a broader set of agreements between Brazil and the UK on Tuesday on the sidelines of the Group of 20 leaders’ summit in Rio de Janeiro, according to people familiar with the talks.
The change in domicile was not included in a joint announcement by the two governments penned on Tuesday since it was still pending approval from the UK’s HM Revenue & Customs authority, according to two of the people, who asked not to be named discussing private information.
“Nubank continuously reviews its corporate legal structure to align with the footprint of its operations,” a spokesperson for the company said in a statement. “At this time, no decision has been made regarding the redomiciliation of Nu Holdings Ltd. or any other legal entities within our group. As a publicly traded company, we are committed to transparency and will follow standard communication protocols if and when any such decisions are made.”
Nubank — whose holding company is currently based in the Cayman Islands and is listed on the New York Stock Exchange — recently became the most valuable bank in all of Latin America. While its corporate headquarters would remain in Sao Paulo, Brazil, the change in legal domicile to the UK would be seen as a big achievement in efforts by British Prime Minister Keir Starmer’s government to attract more technology firms and investment to the country.
Last month, the UK Department for Science, Innovation and Technology said it was opening an office to speed up approvals of novel technologies. The new body, called the Regulatory Innovation Office, is designed to reduce the time entrepreneurs wait to get inventions to market and streamline the regulatory hurdles they must deal with.
The Labour government has been courting tech companies and investors as it faces a broad decline in sentiment among businesses, after Chancellor of the Exchequer Rachel Reeves unveiled £40 billion ($50.5 billion) of tax increases in its first budget. Measures included raising the national insurance payroll tax for businesses to 15% and reducing the threshold at which companies start paying the tax. The government also raised capital gains tax and scrapped the value-added-tax exemption on public-school fees.
Founded in 2013, Nubank has rapidly grown into one of the world’s most well-known fintech companies, with its app on the phones of around 60% of all Brazilian adults. It also has operations in Mexico and Colombia.
While its breakneck growth has helped propel its stock up by about 60% since the start of the year, some investors have started questioning the quality and high valuation of its loan portfolio. The bank has managed to make a name for itself amid Brazil’s conservative banking landscape, in part by lending to lower-income borrowers, a move that had been largely eschewed by the local financial establishment.
--With assistance from Daniel Carvalho.
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