Brazil's Central Bank Grants TCU Access for Rapid Review of Banco Master Liquidation

Overview

• After a meeting in Brasília, TCU president Vital do Rêgo said the central bank will open the files that underpinned the extrajudicial liquidation for inspection.
• Vital reiterated that the TCU has no authority to reverse the liquidation, which he called an administrative and regulatory act, and said the prospect of a precautionary suspension has been removed.
• The analysis is expected to conclude in under a month, and the plenary vote set for January 21 on the bank’s embargos may no longer be necessary according to reporting.
• The review will respect legal secrecy and focus on legality and regularity, with the central bank seeking the TCU’s seal of quality to bolster juridical certainty.
• TCU technicians preliminarily found no negligence by the central bank, which cited an acute liquidity crisis and concentrated, illiquid exposures at Master; separately, a U.S. court recognized the Brazilian liquidation and froze the bank’s assets.