Magalu announces, this Monday, Jörg Friedemann as the new CEO of MagaluBank, as the company’s financial arm is called internally. With 25 years of career in the financial market – the last two of them as responsible for investor relations and ESG at Nubank – Friedemann’s mission is to grow the business in this area, driven mainly by the increased penetration of financial products on Magalu’s digital platform. Currently, penetration in the physical network, consisting of more than 1,200 stores and responsible for about a quarter of total sales, stands at 40%. On digital platforms, which account for approximately 75% of revenue, penetration is below 5%. The expansion of financial operations is expected to contribute significantly to the ongoing process of increasing Magalu’s EBITDA margin, currently at 8%.
“The growth potential of our financial vertical is immense, especially with the increased offering and conversion in our digital channels,” says Frederico Trajano, CEO of Magalu. “The arrival of Jörg, an executive with extensive experience in the digitization of financial products, will certainly help us harness all this potential.”
Under Friedemann’s responsibility at MagaluBank are the credit operation (represented by Luizacred, a joint venture between Magalu and Itaú), payments, insurance (a partnership between Magalu and BNP Paribas Cardif), and Magalu Consortium. Today, Luizacred manages over 6 million credit cards. In the latest balance sheet published by the company, the ROE (return on equity) was 30%. Premiums for insurance policies issued in 2024, in turn, exceeded 1.5 billion reais. And the consortium business grew by about 30% last year.
“I am extremely excited about the challenge. Magalu is in a privileged position to grow in the financial vertical,” says Friedemann. “We have credibility, brand, scale with 35 million active customers, a highly competent team, and strong, long-standing partnerships. The opportunities are enormous.”
MagaluBank
Over the last five years, Magalu has strengthened its financial arm through strategic acquisitions, such as Hub Fintech and Bit55, and obtained payment and financial institution licenses, the latter achieved in February this year.
In 2024, the total volume of transactions processed (TPV) by the financial vertical was 100.1 billion reais, and the credit card base ended the year at 6.2 million cards, with a portfolio equivalent to 20.3 billion reais and one of the lowest delinquency rates in history. In the last balance sheet, Luizacred achieved an ROE of 30%, a benchmark for the Brazilian financial system, and posted a net profit of 295 million last year. The profit from Magalu Consortium was 41 million reais.
