215.91 0.00 (0.00%)
After hours: 4:53PM EDT
|Bid||215.63 x 800|
|Ask||216.73 x 800|
|Day's Range||212.54 - 216.14|
|52 Week Range||151.70 - 238.52|
|Beta (3Y Monthly)||1.35|
|PE Ratio (TTM)||9.05|
|Earnings Date||Oct 15, 2019|
|Forward Dividend & Yield||5.00 (2.30%)|
|1y Target Est||235.81|
Apple's new products, Goldman's reservations about the stock, iPhone security issues and its trillion-dollar valuation are the highlights of this roundup.
A U.S. banking regulator on Tuesday proposed easing a rule requiring banks to set aside cash to safeguard derivatives trades between affiliates, marking one of the biggest wins for Wall Street lenders under the business-friendly Trump administration. The proposal, by the Federal Deposit Insurance Corporation, could potentially free $40 billion across the nation's largest banks, according to a 2018 survey by the International Swaps and Derivatives Association (ISDA), the global trade group that has been lobbying for the rule change for years. The proposal is subject to public comment and will likely face resistance from Democratic lawmakers and consumer groups, who have warned that chipping away at regulations put in place following the 2007-2009 financial crisis could sew the seeds of the next one.
Visa (NYSE:V), seeking entrance into the center of 21st century banking, has joined MasterCard (NYSE:MA) in taking a stake in fintech startup Plaid. Plaid writes application program interfaces that act as the infrastructure beneath bank accounts. This lets it power customer-facing fintech specialists like PayPal's (NASDAQ:PYPL) Venmo, Robinhood, Chime and Betterment.Source: Shutterstock Enabling new banking services could make Plaid a sort of Microsoft (NASDAQ:MSFT) for the fintech age -- an operating system for computerized banking.Plaid has attracted $310 million in financing. Its most recent funding round valued it at $2.7 billion. Other backers include Goldman Sachs (NYSE:GS), Citigroup (NYSE:C) and American Express (NYSE:AXP).InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut it's Visa and MasterCard, which have a joint value of almost $700 billion, that are the real get. They have global scale, brand names and good reputations for security and reliability. Battling AlibabaPlaid is ranked as the eighth largest fintech startup. The list is led by credit card issuer Stripe and includes SoFi, a lender whose name will grace the new Los Angeles football stadium. Fintech companies raised a total of nearly $40 billion last year.Fintech startups are trying to get around the high costs of working with the present banking system. Visa and Mastercard are part of that. But Visa and Mastercard are also trying to get around those costs, seeing the growth of chat-based Chinese payment systems from Alibaba (NYSE:BABA) and Tencent Holding (OTCMKTS:TCEHY). * 7 Momentum Stocks to Buy On the Dip There was an assumption that Facebook's (NASDAQ:FB) Libra -- a cheaper payment system riding on FB's data network -- might be the first to escape the high costs. Both Visa and MasterCard were part of Libra's 28-member founding group announced in June. But there are increasing doubts that financial regulators will allow Libra to launch, as many fear Facebook's size. These regulators seem to have no such fears regarding the payment processors. The Fintech StackThe investment in Plaid, which already serves cryptocurrency companies like Coinbase, brings Visa and MasterCard closer to the new financial world's operating system.Fintech is building a new financial payments stack. Right now, most of the value in the stack is in the loans it creates or the investments it enables. But as the software stack evolves, history shows that it's the company at the bottom of that stack that gains the most power, as Microsoft did starting in the early 1990s.Plaid CEO Zach Perret said his goal is to create a digitized financial system. Visa executive Bill Sheedy said his strategic goal is more important than the financial investment.That strategic goal increasingly looks like a bank. Verifying users and account balances is key to enabling loans, payments and investment -- essentially all the functions of banks like JPMorgan Chase (NYSE:JPM). Visa stock's market cap exceeded that of JPMorgan just in the last year. Many Plaid customers compete directly with banks like JPMorgan. The Bottom Line for Visa Stock and PlaidWhile Visa's payment network has proven to have enormous financial power, it still faces challenges. It can charge merchants up to 3% of a transaction's cost to process through its network. The money is soaked up by processors and banks that are part of the Visa stock network.These payment networks won't work in developing nations. The cost is too high for small merchants to bear. Instead of staying with cash, many are moving to cheaper fintech alternatives that can run through customers' mobile phones.Whether these merchants will stay with Chinese and Indian payment systems, or seek Western alternatives to access Western wallets, remains an open question. The Plaid investment shows just how desperate Visa and Mastercard are to answer that question in the affirmative.Dana Blankenhorn is a financial and technology journalist. He is the author of the environmental story, Bridget O'Flynn and the Bear, available at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing he owned shares in MSFT, BABA and JPM. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Momentum Stocks to Buy On the Dip * 7 Dow Titans Breaking Higher * 5 Growth Stocks to Sell as Rates Move Higher The post Visa's Investment Shows Plaid Could Replace Libra in Fintech Space appeared first on InvestorPlace.
(Bloomberg) -- GitLab Inc., a platform for developing and collaborating on code, has raised $268 million in new funding in a round valuing the startup at $2.75 billion, more than double its last valuation, the company said.The San Francisco-based startup provides a single application for companies to draft, develop and release code. The product is used by companies including Delta Air Lines Inc., Ticketmaster Entertainment Inc. and Goldman Sachs Group Inc.GitLab helps companies “get faster from ‘I want to make this,’ to getting the software out the door,” Chief Executive Officer Sid Sijbrandij said in an interview. “All the companies are becoming software companies, every change you want to make influences software, and the faster you can make that change, the easier it is.”The new funds will be used to add monitoring and security to GitLab’s offering, and to increase the company’s staff to more than 1,000 employees this year from 400. GitLab is able to add workers at a rapid rate, since it has an all-remote workforce, Sijbrandij said.The investment also comes in preparation for a potential public offering next year. GitLab’s largest competitor, GitHub Inc., was acquired by Microsoft Corp. in a stock deal announced in June 2018 worth $7.5 billion. But GitLab will instead aim for the public markets, targeting an IPO or direct listing next fall, Sijbrandij said.“We’d rather stay independent as a company,” he said. GitLab has set a tentative date of Nov. 18, 2020, but the CEO added that the startup will watch market conditions and that nothing is guaranteed.The Series E funding round was led by ICONIQ Capital and Goldman Sachs. New investors include Adage Capital Management, Alkeon Capital and Two Sigma Ventures, among others.GitLab has raised a total $426 million so far, including the new round.To contact the reporter on this story: Kiley Roache in New York at email@example.comTo contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org, Molly Schuetz, Anne VanderMeyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The offering will now be completed by year-end, according to WeWork’s parent company. Advisers for the New York-based company had tested appetite for the IPO at a valuation as low as $15bn, a sharp reduction from the $47bn WeWork attained during its last private fundraising. The company has nonetheless been under pressure, with Mr Neumann giving advisers at JPMorgan Chase and Goldman Sachs until the end of September to finalise the listing, which was expected to raise between $3bn and $4bn.
A perfect storm this week hit one of the most important sources of financial market lubrication, raising concerns that the Federal Reserve’s attempt to unwind post-financial crisis intervention may have gone too far. Repurchase agreements are the grease that keeps the financial system wheels spinning, allowing different market participants to borrow and lend to each other to cover short-term cash needs. , when it typically trades in line with the Federal Reserve’s target interest rate of between 2 per cent and 2.25 per cent. The New York branch of the Fed had to step in to restore order.
WeWork’s chief executive Adam Neumann told employees he had been “humbled” by the aborted initial public offering of his lossmaking property group, admitting he needed to learn lessons about running a public company. its eagerly-anticipated listing, Mr Neumann expressed his contrition over the handling of the IPO process, according to people who saw the presentation. Amid recriminations over the derailed process, one person who worked closely with Mr Neumann said his outsized personality played a “huge role”.
WeWork owner The We Company has postponed its initial public offering (IPO), walking away from preparations to launch it this month after a lacklustre response from investors to its plans. The U.S. office-sharing startup was getting ready to launch an investor road show for its IPO this week before making the last-minute decision on Monday to stand down, people familiar with the matter said. The company has been under pressure to proceed with the stock market flotation to secure funding for its operations.
(Bloomberg) -- Oil surged the most on record after a devastating attack on Saudi Arabia intensified concerns about growing instability in the world’s most important crude-producing region.In an extraordinary start to the week’s trading, Brent futures in London leaped a record $12 a barrel in early trading Monday, before settling just above $69 for the biggest one-day percentage gain since the contract began trading in 1988. Prices may remain elevated after Saudi officials downplayed prospects for a rapid recovery of production capacity.Saudi Aramco faces weeks or months before most output from its giant Abqaiq crude-processing complex is restored, according to people familiar with matter. Saudi Arabia’s Foreign Ministry said Iranian weapons were used in the attacks on Saudi Aramco, while the U.S. blamed Iran for the attacks.For oil markets, it’s the worst sudden supply disruption ever. The attacks that damaged a key processing complex and one of the Saudi’s marquee fields highlight the vulnerability of the world’s biggest exporter. The crisis also means a “new geopolitical premium” of about $5 a barrel, Mizuho Securities USA’s Paul Sankey wrote in a note.“We have never seen a supply disruption and price response like this in the oil market,” said Saul Kavonic, an energy analyst at Credit Suisse Group AG. “Political-risk premiums are now back on the oil-market agenda.”Meanwhile, U.S. Energy Secretary Rick Perry told CNBC that a “coalition effort” will be needed to counter Iran, which the Trump administration said was behind the attacks.Haven assets including gold and U.S. government debt surged as investors fled riskier instruments. Currencies of commodity-linked nations including the Norwegian krone and the Canadian dollar also advanced. U.S. gasoline futures jumped 13%.State-run producer Saudi Aramco lost about 5.7 million barrels a day of output on Saturday after 10 unmanned aerial vehicles struck the Abqaiq facility and the kingdom’s second-largest oil field in Khurais. A Saudi military official earlier said preliminary findings showed that Iranian weapons were used in the attacks but stopped short from directly blaming the Islamic Republic for the strikes.The disruption surpasses the loss of Kuwaiti and Iraqi petroleum output in August 1990, when Saddam Hussein invaded his neighbor. It also exceeds the loss of Iranian oil production in 1979 during the Islamic Revolution, according to the International Energy Agency.“The vulnerability of Saudi infrastructure to attacks, historically seen as a stable source of crude to the market, is a new paradigm the market will need to deal with,” said Virendra Chauhan, a Singapore-based analyst at industry consultant Energy Aspects Ltd. “At present, it is not known how long crude will be offline for.”Aramco officials are growing less optimistic that there will be a rapid recovery in production, a person with knowledge of the matter said. The kingdom -- or its customers -- may use stockpiles to keep supplies flowing in the short term. Aramco could consider declaring itself unable to fulfill contracts on some international shipments -- known as force majeure -- if the resumption of full capacity at Abqaiq takes weeks. Alternatively, the kingdom’s own refineries may cut runs just to keep crude exports flowing, according to analysts with JBC and Energy Aspects.Declaring force majeure would rattle oil markets further and cast a shadow on Aramco’s preparations for what could be the world’s biggest initial public offering. It’s also set to escalate a showdown pitting Saudi Arabia and the U.S. against Iran, which backs proxy groups in Yemen, Syria and Lebanon. Iran-backed Houthi rebels in Yemen claimed credit for the attack, but U.S. President Donald Trump and Secretary of State Mike Pompeo have already blamed Iran.Trump Vows U.S. ‘Locked and Loaded’ If Iran Was Behind AttacksTrump, who said the U.S. is “locked and loaded depending on verification” that Iran staged the attack, earlier authorized the release of oil from the nation’s emergency reserves. The IEA, which helps coordinate industrialized countries’ emergency fuel stockpiles, said it was monitoring the situation.Brent for November settlement rose 15% to $69.02 on ICE Futures Europe. The global benchmark could rise above $75 a barrel if the outage at Abqaiq lasts more than six weeks, Goldman Sachs Group Inc. said.On the New York Mercantile Exchange, West Texas Intermediate futures for October delivery settled up 15% at $62.90, the highest close since May 21. Brent’s premium to WTI for the same month closed at $6.35 a barrel. Volume for both Brent and WTI hit record highs, according to the exchanges.The drama wasn’t limited to flat prices. The spread between Brent and WTI widened as much as 37%, showing that the oil spike will affect global prices more than those in the U.S., where shale output and ample supplies provide more of a buffer.\--With assistance from Nayla Razzouk, Javier Blas, Anthony DiPaola, Michael Roschnotti, Tina Davis, Serene Cheong, Dan Murtaugh, Stephen Stapczynski, Ramsey Al-Rikabi, Saket Sundria, Ann Koh, Andrew Janes, Heesu Lee, Sarah Chen, Sharon Cho and Ben Sharples.To contact the reporter on this story: Sheela Tobben in New York at email@example.comTo contact the editors responsible for this story: David Marino at firstname.lastname@example.org, Joe Carroll, Mike JeffersFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- The message to Adam Neumann was clear: You’re not Zuckerberg.Over the past month, as Neumann’s grandiose plans for We Co. started to fray, bankers began warning that he would have to loosen his iron grip on the company.The old era of Mark Zuckerburg was over, WeWork executives would soon learn. Back in 2012, Zuckerberg could take Facebook Inc. public and still retain extraordinary voting power. But that was then.And so it was that Neumann, the polarizing co-founder of WeWork, begrudgingly agreed this week to cede some of his powers. The question now: Will that be enough? Already, WeWork’s hoped-for valuation has plunged by more than half, or some $30 billion.By Friday morning, Neumann’s company had hastily filed an amended prospectus for an initial public offering -- one that will test not only WeWork and its guru-CEO but, in many ways, an entire generation of money-burning, grow-at-all-cost startups.In a matter of weeks, WeWork’s IPO has gone from one of the most hotly anticipated deals of the decade to perhaps one of the most dreaded. Despite growing skepticism over WeWork’s business prospects, Neumann has resisted corporate-governance changes that would be considered standard elsewhere.The chaos was apparent Thursday and Friday, as WeWork picked a stock exchange, emailed bankers and filed its new prospectus -- all in about 12 hours.Nasdaq ListingDefying skeptics -- among them, some of its own financial backers -- WeWork is plowing ahead with plans to go public on the Nasdaq stock market. Not even Nasdaq officials knew for certain that the company would chose the exchange until the last minute on Thursday, according to people familiar with the matter.Emails were flying into the night. The new prospectus hit just after 6 a.m. on Friday.Now, yet another deadline looms: September 27, the Friday before Rosh Hashanah, the Jewish New Year. Neumann is expected to observe the holiday and be out of communication for several days, people familiar with WeWork said. WeWork representatives did not respond to a request for comment.Neumann didn’t get where he is, atop one of the most talked-about startups of the decade, by sharing. But in a new prospectus WeWork disclosed that Neumann would wield less power via an unusual class of high-voting stock.Now, executives must persuade investors that their company -- which has raised $12 billion since its founding and never turned a nickel of profit -- is worth billions on the stock market. As of late Friday, it was unclear whether they would be able to start marketing the stock via a roadshow starting on Monday, as many had expected.$65 Billion Value?Unclear, too, is just what WeWork might fetch on the open market. Only months ago, some bankers whispered it might be worth as much as $65 billion. Now that figure has fallen to as little as $15 billion.Beyond a page or so of steps WeWork would take to tighten up its corporate governance practices, Friday’s amended prospectus was little changed from the initial one in August.The dedication, even the second time, is pure Neumann:TO THE ENERGY OF WE –GREATER THAN ANY ONE OF USBUT INSIDE EACH OF USAmong other things, the company will trim the voting advantage that gives Neumann sway over the board, and no member of his family will be allowed to sit on the board. WeWork will also announce a lead independent director by year’s end.The move leaves in place a rare three-class stock structure and Neumann still maintains a voting majority, so it’s unclear how much the changes will appease both investors and the banks in charge of managing WeWork’s IPO.Valuation QuestionsQuestions remain about how investors will value the fast-growing, money-losing office leasing business that’s backed by SoftBank Group Corp. Both of the company’s lead financial advisers --JPMorgan Chase & Co. and Goldman Sachs Group Inc. -- have previously voiced concerns about proceeding with an IPO at a valuation around $15 billion, people briefed on the discussions have said.Looking to save the IPO and limit its downside, SoftBank is in discussions to buy about $750 million worth of additional stock in the offering, the people said.The board will have the ability to remove the CEO, and the updated prospectus has taken out a clause that previously said Neumann’s wife Rebekah -- who’s listed as a founder and chief brand and impact officer of WeWork -- will have a role choosing any new chief. Some criticized the changes as not going far enough.“This is an example of posturing,” Jeffrey Cunningham, who teaches management at Arizona State University and has served on several corporate boards, said of WeWork’s changes. The company appears to be facing pressure “to go public at a time that is inappropriate and with a governance record that is questionable.”Still, the moves drove WeWork bonds to be the biggest price gainers in high-yield bond trading for part of Friday. A Fitch Ratings analyst said the changes addressed many of the issues that the ratings company raised in downgrading WeWork’s credit grade last month.“A key component of WeWork’s model is the ability to restrain growth in the event of a downturn and these governance changes increase the likelihood that an independent board will have the power to enforce such a decision,” Kevin McNeil, a director at Fitch, said in an emailed statement.(Corrects the size of the drop in WeWork’s hoped-for valuation in fourth paragraph)\--With assistance from Michelle F. Davis, Anders Melin, Tom Giles and Crystal Tse.To contact the reporter on this story: Gillian Tan in New York at email@example.comTo contact the editors responsible for this story: Liana Baker at firstname.lastname@example.org, ;Michael J. Moore at email@example.com, David GillenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Associate Stock Strategist Ben Rains dives into Apple's (AAPL) new iPhone 11s, as well as its streaming TV service and video game push. The episode also breaks down what's next for Apple stock and why the tech firm looks strong heading into the holiday shopping season. - Full-Court Finance
Morgan Stanley ranked as the top financial adviser in activist campaigns during the first six months of 2019 while Goldman Sachs and Spotlight Advisors each added clients and tied for second place, according to Refinitiv data. Holding onto the No. 1 spot, Morgan Stanley advised 19 companies, including Bristol-Myers Squibb Co and United Technologies Corp, in the first half of 2019. A year ago, when activists launched more campaigns overall, Morgan Stanley counseled 23 companies in the first six months of 2018.
U.S. equities seem ready to push higher with a number of key large-cap stocks perking up on evidence the American consumer is hanging tough. Of course, there continues to be lingering hopes of a thaw in U.S.-China trade relations as well. * 7 Tech Stocks You Should Avoid Now As a result, a number of Dow Jones Industrial Average components are perking up nicely and look good for new money. Here are seven to watch:InvestorPlace - Stock Market News, Stock Advice & Trading Tips JPMorgan Chase (JPM)Shares of Dow component JPMorgan (NYSE:JPM) are blasting to fresh highs today, pushing towards the $120 level with a move above its April and July highs. This puts an end to a two-year consolidation range going back to early 2018.The company will next report results on Oct. 15 before the bell. JPM stock analysts are looking for earnings of $2.44 per share on revenues of $28.14 billion. Boeing (BA)Boeing (NYSE:BA) shares are gaining some altitude and look ready for a breakout from their long post-737 MAX malaise as its engineering team rapidly work towards getting the plane re-certified and back in the air by the end of the year. * 7 Discount Retail Stocks to Buy for a Recession BA stock shares have been in a sideways pattern since early 2018, so watch at the least for a retest of the early 2019 highs. The company will next report results on Oct. 23. Analysts are looking for earnings of $2.24 per share on revenues of $20.8 billion. Caterpillar (CAT)Caterpillar (NYSE:CAT) shares are pushing back towards the upper end of its down channel resistance going back two years. A breakout here would set the stage for a run at the early 2018 highs near $165, which would be worth a gain of more than 20% from here.Dow member CAT stock will next report results on Oct. 23 before the bell. Analysts are looking for earnings of $2.95 per share on revenues of $13.6 billion. DuPont de Nemours (DD)Shares of DuPont (NYSE:DD) look ready for a break above its 200-day moving average, threatening an end to a two-year downtrend channel on the Dow Jones Industrial Average. Look for a rebound to the April high, which would be worth a gain of nearly 15% from here. * 10 Battered Tech Stocks to Buy Now The company will next report results on Oct. 31, before the bell. DuPont stock analysts are looking for earnings of 96 cents per share on revenues of $5.5 billion. Goldman Sachs (GS)Goldman (NYSE:GS) shares are rising to fresh highs as excitement builds around the company's co-branded credit card with Apple (NASDAQ:AAPL) -- a slick unit with functionality integrated into the iPhone that includes a physical card built out of titanium. This is the type of innovation Apple CEO Tim Cook loves, given his training as an accountant.The company will next report results on Oct. 15 before the bell. GS stock analysts are looking for earnings of $5.63 per share on revenues of $8.7 billion. Nike (NKE)Nike (NYSE:NKE) shares are preparing to break up and out of a sideways consolidation range going back to March thanks to repeated bounces off of its 200-day moving average. Nike stock will benefit from the fresh tailwinds being enjoyed by the U.S. consumer thanks to a strong job market. * 10 Recession-Resistant Services Stocks to Buy NKE will next report results on Sept. 24 after the close. Analysts are looking for earnings of 71 cents per share on revenuers of $10.4 billion. Walmart (WMT)Walmart (NYSE:WMT) shares are also pushing to fresh highs, extending a bounce off of its 50-day moving average on the Dow. Morgan Stanley recently raised their price target on WMT stock on its PhonePe financial services play.The company will next report results on Nov. 14 before the bell. Analysts are looking for earnings of $1.09 per share on revenues of $127.8 billion.As of this writing, William Roth did not hold any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Recession-Resistant Services Stocks to Buy * 7 Hot Penny Stocks to Consider Now * 7 Tech Stocks You Should Avoid Now The post 7 Dow Titans Breaking Higher appeared first on InvestorPlace.
Goldman Sachs Group Inc announced on Monday that Chief Risk Officer Robin Vince would retire at the end of the year, according to an internal memo viewed by Reuters. Vince has been the firm's head of risk since 2017 and was responsible "for setting the firm’s overall risk management standards," according to the memo signed by Goldman's Chief Executive Officer David Solomon and others.
The Goldman Sachs Group, Inc. (NYSE:GS) saw a double-digit share price rise of over 10% in the past couple of months...
“When institutional money?” was the cry of retail investors through 2018, as crypto assets sagged and hopes of salvation faded. Institutions have since entered the space, and began to take up positions in bitcoin and other leading assets, but it would be exaggerating to say there’s been a stampede from the direction of Wall Street. […]
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
The departure of Goldman Sachs' chief risk officer is the latest move by CEO David Solomon, who has been shaking up investment bank's top ranks since he took over nearly a year ago.
Evercore's (EVR) strong balance sheet position and robust fundamentals are key positives. However, rising expenses deter bottom-line growth.
(Bloomberg) -- Andre Esteves once joked that Banco BTG Pactual SA, the Latin American investment bank powerhouse he helped create, would one day become “better than Goldman” -- a play on the firm’s name.Now, BTG is chasing Goldman Sachs Group Inc. down another path, looking to build a digital retail bank for the masses.The firm, under the BTG Digital brand, will offer credit and debit cards, checking accounts and loans to individuals by mid-next year, adding to the investment platform focused on high-income clients, Chief Executive Officer Roberto Sallouti said in an interview at the bank’s Sao Paulo headquarters. The plan remains on track after a new round of police investigations targeted the bank in August.“Being a latecomer in this case is a benefit,” Sallouti said, adding that not having branches or old technology allows BTG to offer new products and better service. His five-year goal is to gain a 10% stake in the holdings of retail and private-banking clients, which totaled 2.8 trillion reais ($690 billion) last year.Years after the global financial crisis, Goldman’s then-CEO Lloyd Blankfein set out to build an online bank called Marcus to help diversify his firm’s funding and sources of revenue. The idea is to offer personal loans and savings accounts online at better rates than brick-and-mortar competitors -- helping consumers save money while disrupting incumbents.“The Brazilian middle class has now access to the same products millionaires have and at the same prices,” Sallouti said.Both BTG and Goldman have learned the benefits of drawing low-cost, diversified funding from individuals. That was one of the takeaways of the 2008 financial crisis for New York-based Goldman.For BTG, the lesson came later, in a 2015 crisis when Esteves, 51, was arrested in a probe known as Carwash, sparking withdrawals from big clients. Esteves was ultimately acquitted of all charges, with the prosecutor’s office saying there was “no sufficient proof” against him.See also: BTG in turmoil anew as Esteves is circled by police againThen in August, police searched the firm’s offices and Esteves’s home once again, sending shares tumbling and prompting the bank to react quickly to reassure investors that panic wasn’t warranted. Even after falling more than 20% from from their peak, BTG shares have more than doubled this year and are the second-best performer of Brazil’s benchmark Ibovespa index.BTG Digital has already helped retail deposits jump from 3% to near 17%, bringing a “brutal change in the quality of our funding,” Sallouti said. Once again, there’s a parallel with Goldman Sachs, which said it expected to increase consumer deposits by more than $10 billion a year with Marcus.BTG started its digital initiative in 2016 with a product similar to the one by XP Investimentos SA, which was offering middle-class clients deposits, bonds and stocks at lower fees. While BTG doesn’t disclose such details, Santander analysts Henrique Navarro and Olavo Arthuzo estimated in an Aug. 21 report that the digital unit would have 150 billion reais in assets under custody in three to five years, valuing the venture at around 18.7 billion reais.Sallouti expects the digital platform to break even by mid-2020. Alongside all the new retail banking features, the bank’s digital push includes a new small and mid-size firm lending business, a data-analytics firm, an insurance platform and Banco Pan SA, a smaller lender BTG has a stake in that serves low-income individuals.Fintech firms have multiplied in Brazil, attracting money from the likes of billionaire Warren Buffett, SoftBank and Goldman itself. The newcomers hope to challenge the dominance of the nation’s top five lenders, which hold 85% of total assets compared with 43% in the U.S. Leading the pack are Tencent-backed Nubank, a $10 billion digital bank with more than 10 million users, payments company StoneCo, and XP Investimentos.“We’re moving forward in a way I never thought would be possible for BTG, talking to a client that was once out of our reach,” Sallouti said.Another sign of change? A recent roadshow presentation by BTG included not only the usual financials like ROE or FICC revenues -- but also a chart on the growing number of the bank’s Instagram and YouTube followers.To contact the authors of this story: Felipe Marques in Sao Paulo at firstname.lastname@example.orgCristiane Lucchesi in Sao Paulo at email@example.comTo contact the editor responsible for this story: Michael J Moore at firstname.lastname@example.org, Dan ReichlDavid ScheerFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.