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Morgan Stanley recommended clients buy shares of Nubank, the largest digital bank in Latin America and the fourth-largest financial institution in Brazil. 

Analysts of the American bank believe Nubank could reach a valuation of USD 100 billion by 2026 — from its current USD 36 billion.

The bank has roughly 85 million customers across operations in Brazil, Mexico, and Colombia. More than a quarter of Brazilian bank customers (27 percent) use Nubank as its main service provider, per JPMorgan. In 2021, this rate sat at 15 percent.

Some of Nubank’s investors are Sequoia Capital, Founders Fund, Kaszek Ventures, Tiger Global Management, Goldman Sachs, Berkshire Hathaway, QED Investors, and DST Global.

Shares of Nubank are trading at BRL 6.89 on Brazil’s stock exchange — 40 percent lower than when the company held its initial public offering in December 2021. But Morgan Stanley argues that the bank still holds significant growth potential, both within Brazil and across other countries, particularly in Latin America.

In Brazil, the digital bank could boost its business by tripling revenues over the next five years through cross-selling products to its “large and loyal” customer base, as defined by Morgan Stanley. Furthermore, it could successfully replicate its business model in Mexico and Colombia, aiming to reach 45 million customers within the next five years.

Investment bank Jefferies agrees with Morgan Stanley’s assessment. In a statement earlier this week, Jefferies stated that Nubank is “one of the most significant disruptors globally” and highlighted the significant opportunities in the Mexican market.

In Mexico, Nubank has recently applied for a banking license from the local regulator, the National Banking and Securities Commission (CNBV). The digital bank intends to expand its operations and product portfolio in the region, including investments, salary portability, and higher deposit limits.

It has been three years since Nubank began its operations in Mexico, where it already serves 3.2 million customers. In the first half of 2023, the bank introduced a high-yield savings account, which attracted over a million customers in less than a month.

The Nubank holding posted record profits in Q2 2023 at USD 1.9 billion — a 60 percent growth from a year prior. 

The U.S. announced on Wednesday a temporary lift on the Donald Trump-era economic sanctions imposed on Venezuela’s oil, gas, and gold sectors, following an electoral agreement reached earlier this week between the government of Nicolás Maduro and representatives of the opposition (our Latin America Weekly newsletter explained the issue).

According to the deal, elections in Venezuela will be held during the second semester of 2024 and also under the auspices of international observers, all in order to guarantee a free, transparent process — in 2018, Mr. Maduro’s re-election was not recognized by the U.S. and several world nations for being considered neither free nor fair. The process was also massively boycotted by the opposition. 

The six-month provisional relief was made public in a statement issued by the U.S. Treasury Department, which said the decision comes “in response to the signing of an electoral roadmap agreement” between the Chavistas and the opposition’s bloc Unitary Platform of Venezuela. 

The document temporarily greenlights transactions related to the aforementioned mining and energy sectors, but can be revoked “at any time, should representatives of [the] Maduro [administration] fail to follow through on their commitments,” the office said. 

The new steps were highly celebrated by President Maduro, who projected a “strong return” to the oil and gas market soon. His country is home to the world’s largest oil reserves, a sector that comprises over 90 percent of the country’s exports — meaning such sanctions could be devastating to the Venezuelan economy.  

Later in the week, Reuters also reported that five Venezuelans, including “well-known opposition figures,” had been released from jail, something also foreseen by the new arrangements. The new developments also take place a few days before the opposition’s long-awaited primaries, to be held on Sunday for the first time in a decade.

• Go further: Venezuelan opposition holds primaries as uncertainty continues

The pioneer of streaming services, Netflix recorded a net profit of USD 1.67 billion in Q3 2023, a 19.9 percent increase compared to the same period last year. Revenue from July to September reached USD 8.54 billion, a 7.8 percent growth from a year ago. 

The numbers show that the platform has not been affected by the almost five-month strike of Hollywood writers and actors. It also shows that the company’s strategy of banning account sharing, which began to be implemented in 2022, had a positive effect on Netflix’s results throughout the year — the company recovered subscribers lost in Q1 and continued to grow.

The streaming platform has 10.8 percent more subscribers than a year ago, reaching 247.1 million members worldwide. In the case of Latin America, Netflix gained 1.18 million subscribers in Q3; there are 43.6 million members in the region.

The streaming platform’s revenues in Latin America totaled USD 1.14 billion, an increase of 11.6 percent in the year — growth driven by the strategy of ending subscription sharing, which led to a 3 percent increase in average revenue per subscriber in the region to USD 8.85.

Over 70 percent of Netflix members are now outside the U.S. —which also means more investments in original productions in other regions. “We are now producing or co-producing in over 50 countries and languages with the goal of delighting local audiences,” said the company in its letter to shareholders. 

The company’s immediate priority is building its ad membership so that Netflix becomes an essential buy for advertisers. Over Q3, the platform’s ads membership increased nearly 70 percent quarter-over-quarter and now accounts for around 30 percent of all new sign-ups in the 12 countries where Netflix offers this option. 

According to the company, the growth in ad membership “has been driven by improvements to our offering — including two streams, higher quality video, and a programming slate that’s now essentially on par with our other plans — as well as the phasing out of our Basic plan for new and rejoining members in the US, the UK, Italy, and Canada.” Therefore, the company decided to do the same in six other key markets, including Mexico and Brazil.  

In Brazil, the platform confirmed the end of the so-called “basic” plan, which costs BRL 25.90 (USD 5.12) monthly. 

New subscribers and members renewing subscriptions will now have three plan options: Standard with ads (BRL 18.90), with up to two simultaneous screens; standard without ads (BRL 39.90), and premium (BRL 55.90 and four simultaneous screens).

The political crisis in Guatemala had new developments this week, as Interior Minister David Barrientos resigned from his post following complaints that he had refused to use state force to clear roadblocks organized in support of President-elect Bernardo Arévalo and against Prosecutor General Consuelo Porras. 

Mr. Arévalo took a surprise victory in this year’s presidential elections despite multiple bans on opposition candidates. His party was also banned after winning, leading to a shaky transition that is being resisted by many in the current administration.

Mr. Barrientos’ resignation happened shortly after authorities confirmed that one person was killed and another two were injured during shootings close to a protest hotspot in the district of Malacatán, close to the Guatemala-Mexico border. It was immediately accepted by outgoing President Alejandro Giammattei.

Despite massive pressure for officials to remove the numerous barricades that popped up across the country since early October, the former Interior Minister had defended dialogue. His stances displeased the Prosecutor’s Office, whose members officially requested the minister’s dismissal for “disobedience.” 

Analysts are now warning that the new Interior Minister will have no option but to dismantle the blockades, raising risks of police abuses and putting human rights NGOs on alert. 

Prior to these developments, OAS Secretary General Luis Almagro described those attending the pro-democracy protests as “peaceful demonstrators” that can “in no way be confused with criminal elements.” Mr. Almagro also condemned efforts led by Ms. Porras against a stable democratic transition in Guatemala, describing the legal threats against Mr. Arévalo and his party Semilla as a “shameful example for the hemisphere.” 

The president-elect and his backers see Ms. Porras as the primary hindrance to the upcoming inauguration in January. Despite Mr. Giammattei’s promise to deliver an orderly transition, meetings between him and his rightful successor have been suspended by the forthcoming administration until “necessary institutional and political conditions are re-established.” 

• Take a deeper look: Arévalo wins, but governability questions lie ahead

President Gustavo Petro of Colombia spent much of last week fighting online about the Israel-Hamas conflict — getting into an argument with top Israeli diplomats that has escalated into threats of fully suspending bilateral relations.

“If we have to suspend foreign relations with Israel, then we will,” Mr. Petro said yesterday on X (formerly Twitter). “We do not support genocide. You do not insult the president of Colombia.”

His words came in response to a message from the Foreign Ministry of Israel, which accused Mr. Petro of making “hostile and anti-Semitic statements” and reflecting “support for the atrocities committed by Hamas terrorists.” The Ministry then announced it would halt security exports to Colombia “as a first measure.” 

Mr. Petro condemned both Hamas’ and the Israeli government’s actions in multiple online appearances throughout last week — but sparked a big backlash when he compared the Gaza strip to the Warsaw Ghetto and Israel’s actions in the region to those of Nazi Germany.

Accusations escalated further this weekend when Mr. Petro denounced Israel for its role in paramilitary massacres in Colombia.

“The Yair Kleins and the Raifal Eithans cannot tell us about the history of peace in Colombia. They unleashed massacres and genocide in Colombia … One day, the army and the government of Israel will ask for our forgiveness for what their men did on our soil,” Mr. Petro said.

His words referred to two former members of the Israeli military who collaborated with Colombian right-wing groups during their conflict with left-wing guerrillas. During the 1980s, Mr. Petro was a member of the M-19, a left-wing guerrilla group who made peace with the Colombian state in 1990.

Mr. Petro won the Colombian election on a platform of securing peace between the remaining armed groups and the Colombian state.

Israel and the U.S. have been key weapons providers for Colombia over the last few decades, during which right-wing governments controlled the country. Mr. Petro broke this streak last year with his win at the ballots.

Mr. Petro’s position has sparked criticism from 12 former Colombian Foreign Ministers, who published an open letter in which they accused the president of “radically breaking with our country’s tradition of respect for international law and multilateralism.”

A presidential runoff election will be held in Ecuador on Sunday at what is a turbulent moment for the country. The vote is the result of outgoing President Guillermo Lasso having called snap elections in May to escape impeachment proceedings over accusations of embezzlement. And prior to the first-round election, a presidential candidate was assassinated on the campaign trail.

Over 13.4 million voters are eligible to choose between leftist Luisa González, a 45-year-old lawyer and political heiress of former President Rafael Correa, and Daniel Noboa, the 35-year-old son of a banana tycoon who became a surprise face in the runoff. 

Although Mr. Noboa’s first-round performance surprised many, he has polled first throughout the entire runoff campaign. Four out of five relevant pollsters — who were only allowed to release data until October 5 — showed the young entrepreneur ahead of Ms. González. 

But his polling leads have been narrowing in recent weeks, making the result too close to call. 

Besides the two clashing for a shortened two-year presidential term that starts in November, an unparalleled wave of violence — believed to be strongly linked to drug cartels — has cast a shadow over the election.

“We are no longer dealing with common crime, but with the largest drug cartels in the world,” Ecuador’s President Guillermo Lasso told Ecuadorian daily Primicias. From May 2021 to August 2023, the Ecuadorian National Police seized 502 tons of drugs, the Los Angeles Times reported on September 5.

The worrisome rise in killings even became an electoral game-changer after candidate Fernando Villavicencio was shot dead in Quito, the capital, during a campaign rally only a few days before the first round. The deceased candidate, whose face was kept on voting cards since there was no time to reprint them, ended up being the third most voted.

The crime remains under investigation and is believed to be connected to Mr. Villavicencio’s persistent call against mafias and corruption. Last week, authorities confirmed that six Colombian suspects in the murder of the candidate were found dead inside a prison cell in Guayaquil, leading many to believe that perpetrators could be covering up their tracks. 

To avoid facing the same fate, Ms. González and Mr. Noboa spent the entire runoff campaign wearing bulletproof vests and using armored vehicles, avoiding large gatherings, and being constantly surrounded by heavily armed agents.

With opposing economic and social agendas, one of the two will lead the country until 2025 to finish the constitutional period started by the right-wing incumbent Guillermo Lasso in 2021, which was shortened when he invoked a constitutional clause for early elections in order to avoid impeachment.

Crime will be their top concern, but a limping economy that still bears the effects of the coronavirus pandemic will also be on the table, closely linked to the recent referendum on natural resource use that also took place in August.

• You should also read: How Daniel Noboa sneaked into the presidential runoff in Ecuador
• And: In Ecuador, Rafael Correa is running by proxy

Costa Rican authorities on October 10 began requiring all Honduran citizens entering the country to show a travel visa, with the sole exception of passengers with layovers at Costa Rican airports.

The decision was explained by Security Minister Mario Zamora, who said it is taking place for “reasons of security and national sovereignty,” as the country detected the entry of “criminal groups” from Honduras.

Dealing with an unprecedented peak of cartel-related violence, with homicides breaking new records in 2023, Costa Rica has been taking security issues very seriously of late.

The government’s measures did not go unanswered. On the same date, Costa Ricans will no longer be visa-exempt when entering Honduras, being required to ask for consular authorization even for tourism and business purposes. In a brief statement, the Foreign Affairs Ministry in Tegucigalpa said that “there will be no exceptions” to the rule.

The decision was criticized by figures such as former Costa Rican President Oscar Arias, who condemned what he called an “ill-advised measure” that “disrupts Central American trade, tourism, and investment.” 

Incumbent Rodrigo Chaves, however, said such commercial concerns are “secondary” compared to the need to suppress violence.The new restrictions also go against recent partnerships signed by Central American nations to deal with the unbridled migration flow through the dangerous Darién jungle in Panama, where over 420,000 crossings were registered so far this year.

Governments around the world have organized repatriation flights from Israel in response to the recent conflict sparked by Hamas attacks on Israeli soil. 

Brazil and Argentina have already begun evacuating civilians. Chile and Paraguay have reportedly made formal requests to the Brazilian Foreign Affairs Ministry for assistance in rescuing their respective citizens still in danger abroad. 

As of Thursday morning, there had been no official response to the requests, but the Brazilian government told local press that neighboring countries’ requests for assistance “will be considered in light of the repatriation process of Brazilian nationals, which will be given priority.”

The Brazilian Air Force is expected to send a total of 15 repatriation flights in the coming days, according to Frederico Meyer, the Brazilian ambassador to Israel, who said earlier this week that 1,700 people had already asked to return from Israel. Roughly 1,000 additional requests came later, as the first plane carrying Brazilians landed in Brasília on Wednesday. 

The plea to leave the region affected by the escalating conflict extends to citizens of several other Latin American countries. 

On Monday, Argentina, home to the largest Jewish community in the region, announced the start of a rescue operation. Mexico, Colombia, and Peru are also studying the best strategies to expedite safe rescue flights. 

• You should also read: How Latin America has reacted to the war in Israel