XP Investimentos SA gained authorization from Banco Central do Brasil to create its own bank, which is expected to begin operations during the second half of 2019, Folha de S.Paulo reported.
After structuring the new entity, XP would still require an operational license from the monetary authority. The bank will be aimed at the brokerage firm's own client, who will have access to loans collateralized by investments.
The reported strategy is aimed at dissuading investors' from selling their investments prematurely under scenarios of financial stress.
Traditional retail banking products, such as checking account and credit card, are planned for a future stage, an anonymous source familiar with the bank reportedly said.
According to the report, CEO Guilherme Benchimol's long-dated project of launching an affiliated bank had been put to a halt when the company considered going public in 2016, an event which was eventually called off when XP decided instead to sell a minority stake to Itaú Unibanco Holding SA.
XP would still consider a public share offering on Nasdaq as private equity funds with stakes in the company currently seek an exit strategy, Folha reported.
Coincidentally, on Dec. 19, Valor Econômico reported that XP gained a favorable ruling from a business court in São Paulo. The ruling banned Banco BTG Pactual SA from approaching or negotiating with distribution agents that are part of a brokerage firm's network.