Public Meets Private: Brazil’S BRB Acquires Banco Master To Rival Giants

(MENAFN- The Rio Times) A top official announced on March 28, 2025, that Banco de Brasília (BRB) acquired 58% of Banco Master for R$ 2 billion ($351 million).

Paulo Henrique Costa, BRB's president, drives this strategic shift to expand the public bank beyond its Federal District roots.

The deal merges BRB's 15 million clients with Master's niche strengths, targeting a spot among Brazil's top ten banks.

BRB, controlled by the Federal District government with a 96.85% stake, evolved from a scandal-plagued entity into a national player.

Since 2019, Costa boosted its client base from 680,000 to over 8 million, leveraging digital banking and partnerships like Nação BRB FLA.



Meanwhile, Banco Master, founded by Daniel Vorcaro, thrived in payroll credit cards but stumbled with liquidity issues by 2024.

The acquisition secures 49% of Master's voting shares and 100% of its preferred shares, valuing Master at R$ 3.45 billion ($605 million).
Public Meets Private: Brazil's BRB Acquires Banco Master to Rival Giants
BRB pays 50% upfront, holds 25% in escrow for six years, and settles the rest over two years. Costa excludes R$ 23 billion ($4 billion) in Master's assets-like precatórios and judicial claims-focusing instead on credit cards, corporate banking, and forex.

This move follows BRB's failed 2022 bid for 25% of Banese, halted by a government shift in Sergipe. Starting in 2021, BRB sought partners to grow in capital markets and international operations.

By mid-2024, it tested Master's portfolios, buying credit card assets monthly, confirming their low-risk, high-profit fit for BRB's public servant focus.

Master's 2023 profit hit R$ 532 million ($93 million) with a 28% return on equity, dwarfing BRB's 10%.

Yet, its funding costs soared at 120% of Brazil's CDI rate, unlike BRB's 89%. Critics see a bailout, but Costa insists BRB buys a restructured Master, blending its brand strength with Master's expertise for a competitive edge.

The deal awaits approval from Brazil's Central Bank and Cade, with Costa expecting a swift Cade review.

BRB gains near-half control of Master's governance, alternating leadership roles with Vorcaro, who shifts to the board.

Governor Ibaneis Rocha backs the move, eyeing R$ 800 million ($140 million) in dividends for schools and roads.

Now, BRB boasts R$ 112 billion ($19.6 billion) in assets and a R$ 72 billion ($12.6 billion) credit portfolio, rivaling Brazil's banking giants.

Costa rejects political meddling claims, stressing a technical process to diversify BRB's offerings. However, some question using public funds for a bank once teetering on collapse.

This acquisition marks a pivotal moment for BRB, blending public stability with private agility.

As regulators scrutinize, the financial world watches whether this reshapes Brazil's banking landscape-or strains a public institution's limits. The story unfolds with billions at stake and millions of clients in play.

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