Nasdaq Inc. NDAQ recently agreed to provide its AxiomSL regulatory reporting solution to Nubank. This marks the expansion of its digital bank financial technology in Latin America as well as the extension of Nasdaq’s partnership with Nubank. 

Nubank is a leading digital bank with over 100 million customers across Brazil, Mexico and Colombia. Its existing partnership with Nasdaq involves the technology that supports the bank’s treasury function, managing its fixed income and money market operations. This new agreement will strengthen the regulatory reporting obligations in Colombia.

Latin American Banking Services Undergo Transformation

Per a recent report by the Inter-American Development Bank (IDB) and Finnovista, fintech startups in Latin America have grown more than 340% over the last six years, reflecting the radical transformation of the financial system. Per a study published by McKinsey & Company, Latin America’s relatively young demographic is skewed toward digitalization and prefers non-cash payments over cash payments.

This apart, there is a continuous enhancement in the regulatory framework. All these combined will help unlock significant growth opportunities for financial services providers.

Latin America’s regulatory environment is quite complex. Nasdaq’s advanced technology will thus help banking partners to keep up with the challenges and grow at the same time.

Nasdaq’s Latin American Presence

Nasdaq has more than 50 banking and payment services clients in Latin America, including digital and traditional banks, local and regional players as well as tier-one global banks. Nasdaq provides AxiomSL, which supports financial and regulatory reporting requirements across 55 countries and 110 regulators, and Nasdaq Calypso, which provides the SaaS technology platform that manages banks’ treasury, risk and collateral management workflows. 

This agreement will help Nubank cater to the increasing demand for third-party financial technology solutions in Latin America.

Apart from Nubank, other digital bank and payment companies like Mercado Libre, Latin America’s leading e-commerce and digital payments company, C6 Bank, a full-service digital bank in Brazil, and Bankaool, the first bank to receive a license from the Mexican government to provide digital-only services, use Nasdaq’s advanced technology. 

Nasdaq Ramps Up Growth Through Strategic Initiatives

Nasdaq is on track with its goals of maximizing opportunities as an innovative analytics and technology partner in the capital markets, developing and deploying marketplace economy technology strategy and consolidating a competitive edge in its core businesses. Nasdaq also partnered with a group of leading banks in the private market space to boost Nasdaq Private Market. 

Nasdaq’s organic growth has also been aided by its strategy of accelerating its non-trading revenue base, which includes Trading Services and Marketplace Technology businesses, Data & Listing Services, Index and Workflow & Insights businesses and Anti-Financial Crime business, thereby infusing dynamism in its business profile.

NDAQ’s Stock Price Performance

Year to date, the stock has returned 26.7% compared with the industry’s rise of 11%, the sector’s increase of 15.2% and the Zacks S&P 500 composite’s growth of 20.2%. Impressive organic growth, ramping up of on-trading revenue base, strategic buyouts to capitalize on growing market opportunities and effective capital deployment should help this Zacks Rank #3 (Hold) company retain the momentum.

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Stocks to Consider

Some better-ranked stocks from the finance sector are Abacus Life, Inc ABL, Enact Holdings ACT and Aflac Incorporated AFL. Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Abacus Life’s 2024 and 2025 EPS indicates a year-over-year increase of 9.6% and 28.7%, respectively. Year to date, shares of ABL have lost 9.6%.

Enact Holdings’ earnings surpassed estimates in each of the last four quarters, the average beat being 13.96%. Year to date, shares of ACT have gained 24.4%. The Zacks Consensus Estimate for ACT’s 2024 and 2025 earnings implies 1% and 1.1% year-over-year growth, respectively. 

Aflac’s earnings surpassed estimates in three of the last four quarters and missed in one, the average earnings surprise being 8.24%. Year to date, AFL stock has surged 32.2%. The Zacks Consensus Estimate for AFL’s 2024 and 2025 earnings indicates 8.4% and 5.1% year-over-year growth, respectively.

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