BTG Pactual Acquires R$1.5 Billion in Assets to Stabilize Troubled Banco Master

Brazilian investment bank BTG Pactual purchased R$1.5 billion ($266 million) in assets from Banco Master’s controlling shareholder Daniel Vorcaro, according to securities filings approved by Brazil’s Central Bank and Credit Guarantee Fund (FGC).
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\nThe deal includes real estate, minority stakes in utilities firm Light (15.17%) and cashback platform Méliuz (8.12%), and credit rights. Proceeds will bolster Banco Master’s capital amid a liquidity crisis exacerbated by its high-risk funding model.
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\nThe transaction aligns with BRB’s pending acquisition of 58% of Banco Master for R$2 billion, though BRB excludes R$33 billion of Master’s riskiest assets—including court-ordered government debts (precatórios)—from the deal.
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\nA Federal District court temporarily halted BRB’s purchase in April 2025, citing procedural flaws in shareholder approvals. Banco Master’s aggressive growth since 2017 relied on certificates of deposit (CDBs) yielding up to 140% of Brazil’s benchmark rate, far above the 110–120% industry average.
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\nThese CDBs, half backed by FGC guarantees, funded speculative investments that now threaten systemic stability. BTG’s asset purchase avoids direct exposure to Banco Master’s equity but provides short-term liquidity.
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Plunging Coverage Ratio and Mounting Risks

\nFGC’s coverage ratio—a key measure of deposit insurance resilience—has plummeted from 200% in 2010 to 21% in 2024, raising concerns about contagion risks if Master defaults.
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\nFederal prosecutors opened a preliminary inquiry into BRB’s acquisition for potential “crimes against the national financial system,” focusing on undisclosed liabilities and governance gaps.
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\nBRB CEO Paulo Henrique Costa confirmed negotiations exclude assets misaligned with the state bank’s risk appetite. Private lenders, including BTG, may absorb Master’s excluded portfolio to prevent broader fallout.
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\nBanco Master’s CDB liabilities total R$70 billion, with R$16 billion maturing in 2025. The Central Bank’s approval of both transactions will signal Brazil’s approach to balancing financial innovation with systemic safeguards.

For the full timeline, see our Banco Master Scandal: Complete Timeline.

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