The central bank announced the extrajudicial liquidation of Banco Master on Tuesday. In this decision, the Central Bank also points out the unavailability of the assets of the bank’s supervisors and former administrators. The owner of the institution, Daniele Forcaro, was also arrested in a federal police operation investigating an alleged scheme to create and trade counterfeit credit securities by institutions forming part of the national financial system.
The liquidation decision also applies to Master Corretora de Câmbio, Títulos e Valores Mobiliários. In addition, British Columbia decreed a special interim management system for Banco Master Múltiplo.
A liquidation system is a means of closing down in an organized manner the activities of an institution in difficulty and suffering from serious financial, operational or administrative problems, with the aim of stabilizing the national financial system. The goal is to protect creditors.
In the statement, BC informed that EFB Regimes Especiais de Empresas has been appointed as liquidator, and the technical person responsible for the liquidation is Eduardo Felix Bianchini, who has “powers to manage and represent the company.”
The assets of the following institutions and executives have been frozen:
- Master Finance Holdings SA
- 133 Investments and Limited Participation
- Armando Miguel Gallo Neto
- Angelo Antonio Ribeiro da Silva
- Luiz Antonio Paul
- Jose Ricardo de Queiroz Pereira
- Reynaldo Hospian Sales Lima
- Vinicius da Silva Pinto
According to the authority, “any information regarding the existence of assets or values registered or registered in these institutions in the name of Banco Master, Banco Master Múltiplo and the brokerage must be transmitted directly to the EFB.
Forcaro is one of the targets of Operation Zero Compliance launched by the Federal Police on Tuesday. The operation investigates an alleged scheme to create and trade counterfeit credit securities by institutions forming part of the national financial system.
Agents issued five protective arrest warrants, two temporary arrest warrants, and 25 search and seizure warrants. The action takes place in Rio de Janeiro, São Paulo, Minas Gerais, Bahia and the Federal District.
Investigations began in 2024, at the request of the Federal Public Prosecution. The suspicion is that a financial institution has produced credit portfolios without real collateral and sold these securities to another bank. After inspection by the Central Bank, the bonds could have been replaced with other assets without a proper technical evaluation.
The Federal Police investigates possible crimes of fraudulent management, reckless management, formation of a criminal organization and other offenses.
Banco Master has grown a lot in recent years with a strong financing strategy. The commercial development banks in the market have been offered returns well above the market average, with the protection of a Credit Guarantee Fund (FGC).
This year, the institution has gone from being a candidate to be bought by a public bank to the hero of a crisis that has mobilized regulators and generated political tensions in Brasilia.
The starting point was the announcement, at the beginning of the year, of the intention of Banco de Brasília (BRB) to purchase 58% of Master’s capital for approximately R$2 billion. The operation was presented as a strategic bet to expand the national presence, but it quickly raised doubts about Master’s financial health – particularly due to the high level of financing via short-term community development banks at costs well above the market average.
From then on, it started coming and going. The Federal District Legislature approved the deal, but the Court of Justice questioned parts of the agreement. Prosecutors – both local and federal – have opened investigations to assess the consistency of the operation and the potential financial implications. At the same time, Kidd gave his competitive endorsement, while political pressure from Centralo parliamentarians in defense of the purchase mounted, amid criticism of the central bank’s stringency.
Even as moves were made behind the scenes to make the deal viable, Columbia Bank’s technical team intensified its analysis in light of the increased risks. The amount of expensive core funding, combined with portfolio fragility and liquidity risk, is negatively impacting the business. At the beginning of the month, the municipality formally objected to the process with the BRB, raising greater alarm about the true status of the institution.
This decision was the impetus for the final outcome: unable to demonstrate the ability to continue operating, BancoMaster was ordered to be liquidated extrajudicially.
March 2025: Preliminary agreement announced: BRB expresses its intention to acquire 58% of Banco Master SA for approximately R$2 billion, with the aim of national expansion.
April-July 2025: Audit and legal proceedings begin by bodies such as the Public Ministry of DF, the MPF and the Ministry of Public Accounts, raising doubts about the valuation of assets (precatório) and the transparency of the process.
August 2025: The DF Legislative Council approved the law authorizing the BRB (State Bank) to carry out the takeover, giving the political green light.
June-August 2025: The Central Bank’s Supervisory Board intensified its demands for additional guarantees and adjustments to the business structure, expressing reservations about the master’s liquidity and liabilities.
September 2025: The Central Bank (BC) officially rejects the takeover by BRB, definitively ending negotiations between the two banks.
November 2025: Master searches for new investors, leading to the takeover offer by Victor Holding Financeira (with foreign investors) and the announcement of a R$3 billion investment, in a process that leads to the dismantling of the group and awaits BC approval.
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