The Central Bank decreed, this Tuesday (18), the extrajudicial liquidation of Banco Master S.A., a financial institution based in São Paulo. The measure immediately suspended all operations, blocked current accounts, savings and applications and prevented withdrawals or transfers by customers. The decision was published in the Official Gazette of the Union and has already automatically activated the Credit Guarantee Fund (FGC).
The intervention took place after finding that the bank’s economic and financial situation had been seriously compromised. The BC appointed EFB Regimes Especiais de Empresas, under the technical responsibility of Eduardo Felix Bianchini, as liquidator. The process now follows steps set out in Law 6,024/1974, focusing on protecting depositors and recovering assets.
Customers with balances of up to R$250 thousand by CPF or CNPJ, at each group institution, will have the amounts reimbursed by the FGC. Payment usually starts between 10 and 20 days after delivery of the data by the liquidator.
Immediate blocking of operations
All transactions at Banco Master S.A. were suspended at the time of the liquidation order.
Customers are unable to make withdrawals, transfers, bill payments or application redemptions.
Access to internet banking and the application has also been disabled to prevent new operations.
Appointment of liquidator and inventory
The liquidator assumes full command of the institution, replacing the old board.
The first task consists of the complete survey of assets and liabilities, an average period of 60 to 90 days.
The work includes identification of properties, credit portfolios, titles and corporate interests.
After the inventory, the sale of assets begins to generate resources for creditors.
FGC guarantee and payment terms
The Credit Guarantee Fund automatically covers deposits and investments of up to R$250,000 per person or company.
Non-guaranteed products include shares, specific investment funds and CDBs above the limit.
The FGC receives payments after receiving and validating the information provided by the liquidator.
Whoever has higher values becomes an unsecured creditor and awaits the sale of assets.
Asset sale and payment order
The longest step in the process involves negotiating loan and property portfolios.
The funds raised follow legal order of priority:
- Labor credits (salaries and severance pay)
- Creditors with real guarantee
- Refund to FGC
- Unsecured creditors
- Shareholders (only if there areleftover)
This phase can take years, depending on the market and asset quality.
Special regime at Banco Master Múltiplo
Banco Master Múltiplo, another company from the same economic group, was placed under Temporary Special Administration Regime (RAET).
The BC assumes management for up to 180 days, extendable, to attempt restructuring or sale.
If there is no viable solution, the institution may also have liquidation ordered later.
The measure aims to preserve operations considered viable and protect the financial system.
Possible transition to bankruptcy
After completing the inventory, the BC assesses whether the assets cover the obligations.
When the deficit exceeds the available assets, the case is sent to court.
The judge may declare bankruptcy, replacing the liquidator with a judicial liquidator.
At this stage, the Public Prosecutor’s Office may receive complaints about possible irregularities by former administrators.
