Investing.com -- BofA Securities downgraded Nubank to “underperform” from “neutral” rating, cutting its price objective to $10 from $16, after the Brazilian neobank announced chief financial officer Guilherme Lago would step down effective July 13, adding to a string of senior leadership departures the broker said had become "harder to ignore."

Lago, who joined Nubank in 2019 and held the CFO title since 2021, will transition to a Special Advisor role through end of August.

Rob Livingston, most recently CFO for North America at Visa, was named his replacement, bringing more than 30 years of financial services experience.

BofA analysts described Lago as "one of the company’s most important executives, overseeing its IPO and helping shape Nu’s financial discipline during a period of rapid growth and rising profitability" and "the key market-facing executive and a central figure in communication with shareholders."

His departure follows exits by four other C-suite executives over the past two years, President and COO Youssef Lahrech, Chief Product Officer Jag Duggal, Chief Technology Officer Vitor Olivier and Chief Credit Officer Ravi Prakash, which BofA said "increase uncertainty around execution and management depth."

The rating change came as BofA revised its target price-to-earnings multiple to 13x its 2026 earnings per share estimate of $0.89, down from 18x previously.

The broker described the new multiple as two standard deviations below Nubank’s two-year average, citing "rising execution and strategic risks."

BofA’s 2026 EPS estimate of $0.89 compares to Bloomberg consensus of $0.86 and Visible Alpha consensus of $0.88.

BofA projects Nubank’s net interest income will reach $15.33 billion in 2026, up from $9.55 billion in 2025, with provisions expense expected to surge 80.9% to $8.04 billion, a provisioning burden equal to 57.2% of pre-provision profit, up from 50.4% in 2025.

Total gross customer loans are forecast to rise to $42.79 billion from $27.69 billion, with the loan-to-deposit ratio climbing to 76.5% from 66%.

The broker’s return on tangible equity is expected to slip to 26.4% in 2026 from 27.1% in 2025, extending a declining trend from 28.9% in 2024.

Revenue growth is projected at 58.2% for 2026, while operating expense growth is forecast at 54.8%, narrowing operating leverage to 3.4 percentage points from 20.2 percentage points in 2025.

BofA cited deteriorating asset quality indicators, risk-adjusted net interest margin pressure and lower earnings visibility as additional factors behind the downgrade, alongside Nubank’s geographic expansion into Mexico, Colombia and the United States and its pending application for a U.S. national bank charter.