JPMorgan-backed digital bank C6 to open Brazil branch network

By Aluisio Alves

SÃO PAULO (Reuters) - Brazilian lender C6 Bank is set to open its first five brick-and-mortar branches in the country in the next few weeks, an executive has revealed, enhancing the competition between the JPMorgan-backed digital bank and large retail lenders for high income clients in Latin America's largest economy.

C6's head of high income, Felipe Wey, told Reuters on Tuesday that the bank's goal for the coming months is to have at least one office in each of the country's capital cities and in other towns with a large number of potential wealthy clients.

He did not disclose an exact target, but said "dozens of offices are expected to be opened by the end of 2023."

The move comes about a month after C6, established in 2019, launched Carbon, a platform focused on the roughly 20 million account holders who have an income of more than 15,000 reais ($2,862.16) per month or more than 150,000 reais in investments.

It highlights how digital platforms with a lighter structure than large retail banks are gradually seeing opportunities to expand their customer base and do more business with current clients by owning physical branches.

C6's face-to-face units will have about 10 employees each and are expected to increase client engagement by providing a more detailed and customized approach than its larger rivals, said Wey, a former executive at Itau Unibanco's high income brand Personnalite.

Similar units in Brazilian large cap lenders include Banco Bradesco SA's Prime and Banco Santander Brasil SA's Van Gogh.

With the physical branches initiative, C6 aims to increase its share in the high income market, which it expects to cover some 5 million people in the country.

The move also comes as digital financial services platforms look to boost their revenue per customer at a time when investors have been more skeptical of high-growth businesses, given the backdrop of high interest rates.

In 2021, the purchase of a 40% stake in C6 marked JPMorgan Chase & Co's debut in Brazil's retail banking. C6 was founded by former partners at Banco BTG Pactual SA, Latin America's largest independent investment bank.

($1 = 5.2408 reais)

(Reporting by Aluisio Alves; Writing by Gabriel Araujo; Editing by Josie Kao)