Highlights from Galípolo’s first year at the helm of B.C.

• Puck Tuesday: Toffoli says BC director not under investigation, but stresses investigation ‘concerns actions of regulator’
• Support: Febraban and fintechs defend British Columbia in Banco Master case

Discussions about the security of the financial system, driven by the embezzlement of millions of dollars via cyberattacks and alleged links between regulated institutions and organized crime, also mobilized Galípolo’s first year as head of the BC.

The Master affair had repercussions from the beginning to the end of 2025, and questions about the action of the BC, in the political context of Daniel Vorcaro, owner of the now liquidated institution, should continue after the start of the year.

Although Master’s situation was brought to public attention on March 28, when BRB, the state bank of the Federal District government, announced its intention to purchase it, the institution’s liquidity crisis and its aggressive CBD distribution strategy had already been a matter of concern in the financial sector for a long time.

• Serial investigations: In addition to fraud with the BRB, Banco Master is the target of several investigations. See which ones

Today, after the BC rejected the operation and liquidated Master, it is known that the regulator had monitored the relations of the Vorcaro bank with the BRB before announcing its intention to purchase, due to signs of irregularities in the credit portfolio allocation operations. The findings of the agency’s inspection were communicated to the Public Prosecutor’s Office to investigate suspicions of crimes against the financial system due to signs of fabrication of the wallets, which, in turn, supports the Federal Police’s investigation into the matter.

Galípolo contradicts complaints that the agency should have acted sooner. Without mentioning the institution of Vorcaro, the president of BC said that the liquidation decision could not be based solely on the issuance of CDB at 140% of the CDI, which does not necessarily constitute an offense or problem. The argument is that there are rules set out in law to deal with problematic institutions and that it is necessary to rely on solid evidence to avoid future questions – which are already beginning to arise.

This must be in the “model”

The Minister of the Federal Court of Audit (TCU), Jonathan de Jesus, saw signs of haste in the liquidation decision and demanded an explanation from the BC. Furthermore, as determined by Minister Dias Toffoli, of the Supreme Federal Court (STF), the director of the British Columbia Inspectorate, Ailton Aquino, will have to participate in a confrontation with Vorcaro and the former president of the BRB Paulo Henrique Costa, dismissed from his position due to suspicions of collusion with Master’s fraud.

• Context: Why did the Central Bank target the TCU because of the Master and who is the minister in charge of the file

Toffoli referred the investigation, which was previously in first instance, to the Supreme Court due to the involvement of a federal deputy and placed the process in complete secrecy. GLOBO columnist Malu Gaspar published that Moraes put pressure on Galípolo in the Master case. The minister said he had discussed the Magnitsky Act.

— From the beginning, the Central Bank, thanks to the experience of other cases, knew that this was a case that absolutely had to be correct. We need the whole process to continue over time, it usually lasts 5, 10, 15 years — Galípolo said in a press interview on the 18th. — Obviously, as we have done with the MP (Public Ministry) and the PF (Federal Police), British Columbia, but not only British Columbia, I am, as president, at the disposal of the Supreme Court to provide all the data that we have already transmitted to the MP and at the PF and which we have documented. We document everything. Each of the actions that were carried out, the meetings, the exchange of messages.

• From March: IPCA-15 result with insight into full-year inflation within target strengthens analysts’ bet on interest cuts

During the first year, the new commander was unsuccessful on issues such as expanding British Columbia’s autonomy. This is a subject that is expected to remain on the agenda in 2026, as is the expansion of the scope of regulation to investment funds. Security measures will remain at the center of the regulator’s concerns, but important innovation projects must resume, such as Drex (digital currency). Managing the cycle of Selic cuts amid heightened electoral tensions, which are already having effects on the exchange rate, will be another challenge, as will following the “legal battle” and developments in the Master case.

— The BC agenda this year was very busy and included very difficult topics. The Master’s discussion caused a lot of noise and the security agenda raised the debate between fintechs and traditional banks. But British Columbia has succeeded on a technical level — believes economist Silvio Campos Neto, partner at Tendências Consultoria.

The economist points out that the financial market’s distrust of Galipolo came not only from his proximity to Lula, a frequent critic of high interest rates, but also from his functions prior to his arrival at the BC in 2023, as director of monetary policy:

— There were fears that he would take over to satisfy pressure from the government. But that’s not at all what happened. Galípolo has been impeccable in the conduct of his monetary policy, focusing entirely on achieving the inflation target, in a difficult environment.

“A smell of falling interest rates”

Contrary to expectations – or fears – Lula’s candidate did not take matters into his own hands with the increase in interest rates and raised the Selic rate to 15% per year, the highest level since the first PT government. The level reached in June has been maintained and shows the first effects of a slowdown in activity and a control of inflation, albeit slowly.

— It is clear that British Columbia has not yet achieved the goal of deflating current inflation and re-anchoring expectations to targets. But the progress has been quite significant and surprising, says Andrea Damico, economist and founding partner of Buysidebrazil.

• Union approval: Correios closes 12 billion reais loan and the money should arrive in the account by Tuesday

Today, the Monetary Policy Committee (Copom) maintains a cautious stance to ensure the achievement of the 3% inflation target, without giving concrete signs on when the cycle of lowering interest rates should begin, which the market expects for January or March. This position has drawn criticism from the government, mainly from Finance Minister Fernando Haddad and Institutional Relations Secretary Gleisi Hoffmann.

The Executive’s fear is that maintaining Selic for a “very long period” would lead to a slowdown in the economy in 2026, the year in which Lula will seek re-election.

However, the complaints have a different tone from the demands made against his predecessor, Roberto Campos Neto, considered an adversary by the president. In comparison, even with higher interest rates, Lula said he had 100% confidence in Galípolo.

— Everyone predicts that, as we feel the rain, I feel that soon interest rates will start to fall — Lula told journalists at the end of the year.