Financial depth surged in Brazil during the mid-2000s, largely as a result from institutional reforms. At the same time, the country experienced strong economic growth with decreasing income inequality. The objective of this work is to gain perspective on the effects of this financial development on growth and distribution at the national level. We do this through the lens of a dynamic model with financial frictions, in which agents who differ in their wealth and abilities as workers and entrepreneurs make occupational and productive choices under credit constraints. We calibrate the model to replicate the financial deepening observed in Brazil from 2003 to 2012. Our main results indicate that GDP per capita increases by 15 percent and TFP by 2 per cent. Workers benefit indirectly as wages rise by 14 percent in equilibrium. Yet, income inequality slightly increases.