Nu Holdings Is Quietly Building a Banking Empire in Latin America

American investors have no shortage of opportunities to deploy capital within the U.S. financial services industry. However, it's a good idea to expand your horizons. There are booming businesses in other parts of the world.

Nu Holdings (NYSE: NU) is a prime example. It has become a banking powerhouse in Latin America. And it now sports a market cap of $59 billion. Here's what investors need to know before buying the fintech stock.

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All signs point to ongoing success

Nu's value proposition is clear. It provides low-cost, transparent, and easy-to-access financial services to an audience that was not only historically underserved but also unfamiliar with a digital-first model. Founded in 2013, this business continues to register phenomenal growth as its adoption soars.

As of March 31, Nu had over 135 million customers, up 14% year over year. An ever-expanding user base propels the top line. First-quarter 2026 revenue jumped 42% to $5.3 billion.

Most of the users are in Brazil, the company's home country. Nu has a presence in Mexico (15 million customers), where it's the third-largest financial institution. And it has nearly 5 million customers in Colombia. Additionally, while it obtains the necessary approvals, the business is planning to start operations in the U.S. next year, which would be a major milestone.

Still in hypergrowth mode, Nu is reporting sizable profits. Its Q1 net income rose 41% year over year, resulting in a margin of 16.4%. Just four years ago in Q1 2022, the business posted a $45 million net loss.

It's understandable that by avoiding the costly overhead that comes with operating a network of physical bank branches, the company runs a leaner model. Its return on equity (ROE) was 29% during Q1. This is significantly higher than JPMorgan Chase, a dominant and scaled financial services entity, which reported an ROE of 19% last quarter.

Can this fintech stock be a long-term winner?

Nu's financial performance has been exceptional. But the stock is under pressure. It has fallen 28% in 2026 (as of June 11), although it has climbed 61% in the past three years.

Chief Financial Officer Guilherme Lago, a seven-year company veteran, will step down on July 13. Nu's expected credit losses were up 76% year over year, which might be scaring the market. The stock was also downgraded by analysts earlier this month.

These are valid headwinds. But for long-term investors, it's hard not to be interested in this opportunity. Nu shares trade at a compelling forward price-to-earnings ratio of 16.1. This Latin American banking empire deserves a closer look.

JPMorgan Chase is an advertising partner of Motley Fool Money. Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase and Nu Holdings. The Motley Fool has a disclosure policy.