Finance Minister Fernando Haddad advocated for a structural reform of the rules governing the Credit Guarantee Fund (FGC) , stating that the Banco Master case demonstrated that the legal framework is not robust enough, allowing new cases of this type to emerge in the market.

"The legislation has not proven robust enough to prevent an operation like this, which put a lot at risk," he said on Tuesday morning, February 10, at the CEO Conference event hosted by BTG Pactual .

"Fortunately, it wasn't a systemic risk, but it grew to proportions and involved more than one institution. This cannot happen again," he added.

According to him, the authorities and the private sector need to find a "common denominator" to prevent changes to the FGC rules from harming competition and driving smaller players out of the market.

"Neither too much nor too little, because no one can want to maintain rules that allow this debacle to happen again," Haddad stated. "We have to learn from this case and close the loopholes that allowed the fraud and irresponsibility."

The minister highlighted the role played by the president of the Central Bank (BC), Gabriel Galípolo , in the case. Without mentioning Roberto Campos Neto , who has been receiving criticism for his actions in the Master case, Haddad outlined a timeline of the case, emphasizing the role played by his former executive secretary in the Finance Ministry.

According to him, in a six-year period leading up to 2024, Banco Master experienced "exponential growth" that was halted as soon as Galípolo took office. Former president Campos Neto led the Central Bank from February 2019 to December 2024, being replaced by Galípolo.

“Since Galípolo took over, there has been no growth, quite the opposite. And he began to investigate what was inside that balance sheet. And worst of all, following this more in-depth investigation, he discovered a fraud of R$ 12 billion,” he stated. “Given that, there wasn't much that could be done.”

But when questioned about whether there was negligence in the previous administration, Haddad dodged the question, saying that it was a question for him to answer, because he was not leading the investigation. "What I'm saying is that in a six-year period leading up to 2024, Banco Master experienced explosive growth," he stated.

The day before, it was Galípolo who spoke well of Haddad and Lula . At an event at the Brazilian Association of Banks (ABBC), the president of the Central Bank stated that he had institutional support and a guarantee of autonomy to handle the Master case from the Presidency and the Treasury.

Legacy

Haddad also used the BTG Pactual event to highlight the Finance Ministry's actions in the Reag case and the consequences they had for the Master case.

The minister said that while other finance ministers dislike getting involved in this type of issue, he wasn't going to miss the opportunity to deal with fraud and corruption, stating that he had dismantled four billion-dollar corruption schemes in the São Paulo city government.

“Before the liquidation of Banco Master, the biggest operation was by the Federal Revenue Service at Reag. When the Reag operation took place, there was already evidence that Master was involved. So, the work of the Federal Revenue Service, which is part of the National Treasury, of the Ministry of Finance, also began to combat fraud, as is the duty of the Federal Revenue Service to do,” he said.

Upon leaving the Ministry of Finance, and without stating whether or not he will heed the PT's requests to be a candidate for governor of São Paulo, Haddad cited the Tax Reform as his main legacy at the helm of the country's economy.

“People are unable to grasp the depth of the change that will happen to consumption taxes in Brazil,” he said. “I believe that not only with the constitutional amendment and the approved complementary laws, but also with the operating system 150 times larger than Pix , which is already in operation at Serpro, we will leap to one of the best tax systems in the world.”

He also took the opportunity to defend his performance on the fiscal front . Even in the face of criticism regarding a lack of control over public spending and the prospect that the debt will reach 80% of GDP by the end of this year, Haddad stated that he will leave a much better situation than he found, given the restrictions he faced in implementing adjustment measures and spending cuts inherited from the Bolsonaro government.

“What was last year’s deficit? 0.48% of GDP. From 1.6% [deficit in 2023] to 0.48%, you reduced the primary deficit by 70%. Would I have liked to have gone further? I would have liked to have gone further. Now, you have to negotiate with Congress, which had just approved the increase in spending. Fundeb was contracted until this year. The rules for flexibility in BPC eligibility were contracted in 2021,” he said.

"How do you reconcile all of this with the outcry, which I understand, from Faria Lima? But as the people from Bahia say, I am only one person," he added.