Why does the Federal District's pension institute want to sell its BRB shares?

Brasilia - At a time when BRB shares have fallen by 44% since the Federal Police launched Operation Compliance Zero and revealed a fraud scheme involving more than R$ 12 billion with Banco Master , one of its largest shareholders, the Federal District Pension Institute (Iprev-DF) wants to stop being a shareholder in the financial institution.

With 12.3% of BRB's ordinary shares, which is mired in the Master crisis and under pressure from the Central Bank to raise capital, Iprev is surrounded by concerns raised from all sides: retirees, pensioners, active civil servants, opposition to the Government of the Federal District (GDF) - which controls the bank - and even oversight bodies such as the Court of Auditors of the Federal District (TCDF), the Public Prosecutor's Office and the Comptroller's Office of the Federal District.

They have all been questioning Iprev through official letters and want to know if the scandal caused by banker Daniel Vorcaro 's dealings will affect the federal capital's pension institute, compromise pension payments, or even if the fund tends to shrink as BRB's shares fall – the devaluation is close to 30% by 2025 alone.

“The share price has fluctuated with this Master transaction, and this asset is not doing well in the market today. Not now, but at some point, Iprev will have to sell these shares. And the idea is to divest 100% of them,” says Raquel Galvão, CEO of Iprev-DF, to NeoFeed .

"In the view of our investment committee and the Board of Directors, at this moment it would not be prudent [to sell BRB shares], because we would not be able to make any sales and obtain a positive result. We have to wait for the best time to negotiate," he added.

In the last investment portfolio released by Iprev, from December 2025, the institute calculated the value of BRB shares at R$ 531 million. This calculation was equivalent to a share trading at R$ 8.86. On Wednesday, February 25th, the BSLI3 share closed the trading session quoted at R$ 4.81.

“As a BRB shareholder, Iprev is the biggest reflection of everything that is happening with the bank. The shares that Iprev holds have already depreciated by more than 50%, and this intensified even more in November with the Federal Police operation. Investors are terrified. The pension risk is the fund's own ability to cover retirement and pension payments,” assesses a BRB source, on condition of anonymity.

The Iprev-DF's stake in BRB has been decreasing since last year. When the institute acquired BRB shares in 2017, it held 16.7% of the bank's stock. In March of last year, it was 15%, which fell to the current 12.3%. On the other hand, the shareholding of the controlling partner, the Government of the Federal District (GDF), has been decreasing: it reached 80.3% in December 2020 and fell to 65.6% in August 2024. In April of last year, it reached its lowest level, with 53.7% - a position expected in June 2025, according to the last balance sheet published by BRB, which did not disclose its financial information during the second half of last year.

Interestingly, while Iprev and GDF reduced their stake in the bank, the "other" shareholders increased from 10.6% in 2024 to 25% in 2025. Behind the scenes, the market interpretation is that Master and funds or companies linked to it may be dispersed within this "other shareholders" classification.

The fund for retired and pensioned civil servants of the Federal District government denies, however, that this lower participation is related to the effects of the Master Case. It also states that the Master Case or the devaluation of the shares does not cause harm to retirees, pensioners, or the Institute.

If Iprev were to cease being a shareholder of BRB, the pension institute could use the revenue from the sale of shares to invest in multi-market funds or fixed-income securities. However, according to Rachel, this decision, which would require internal authorization within Iprev and approval from the GDF (Federal District Government), had already been under internal discussion even before the Master crisis erupted or BRB's attempt to buy part of Vorcaro's bank.

She explains that, although a 2017 district law allows Iprev to be a partner in the state-owned bank of Brasília, the National Monetary Council (CMN) does not recommend that the Public Pension Systems (RPPS) hold a fixed percentage of participation in companies. Therefore, selling the BRB shares would be a way to comply with national legislation.

“It’s a future intention and possibility. At the moment it’s not advantageous. Today we are partners with BRB through a district law, but RPPS (Regimes Próprios de Previdência Social – Public Sector Pension Schemes) cannot hold shares in publicly traded companies. At this moment we will be cautious. The DF (Federal District) pension scheme will act cautiously so as not to incur losses,” says the CEO.

Fear among retirees

Retired and active employees of the Federal District government have been expressing concern behind the scenes that the local pension fund, which has already lost a stake in BRB (Banco de Brasília) over the past year, may shrink in the future. There is even fear that the local government may have difficulty honoring pension payments in the future.

There is a fear that, if Iprev remains a partner of BRB, the shares could become worthless and the institute could potentially be harmed in the event of the liquidation of the public bank Brasília, in the most drastic scenario. Or its financial sustainability could be jeopardized in the future.

According to the balance sheet from December of last year, Iprev's total portfolio was R$ 8.315 billion. And, at that time, BRB's shares represented 6.39% of the total under management.

The fear among fund investors stems from the recent history of Iprev, which continues to generate concern today: created in 2007 to pay the benefits of civil servants who joined from that year onwards, Iprev has already suffered three withdrawals of its resources by the last two governors (Rodrigo Rollemberg and Ibaneis). The civil servants of the Federal District call these withdrawals "lootings," which in total amounted to almost R$ 2 billion.

To replace the initial withdrawals, the GDF (Government of the Federal District) transferred BRB (Banco de Brasília) shares to Iprev, making the Brasília pension institute a shareholder in the bank. Currently, Iprev manages the Solidarity Guarantee Fund, which totals R$ 6.04 billion (of this amount, R$ 4.2 billion refers to Iprev's net worth in the Fund).

In total, there are more than 70,000 active civil servants who contribute to the Fund – those who joined or retired before 2007, when Iprev did not exist, are covered by a financial fund, which is in deficit, but was incorporated into the Guarantee Fund.

“When you ‘withdraw’ resources from Iprev, you are jeopardizing the fund's financial sustainability. And in a few years, that money may no longer exist. Iprev is still in surplus, but from now on, it won't be. Because today you have more civil servants putting money in [contributing] than civil servants withdrawing, but this trend could reverse. This fund must be preserved to continue generating returns,” says district deputy Gabriel Magno (PT-DF), one of the opposition leaders who has raised concerns about the possible impacts of the Master case on Iprev.

Magno even submitted a request to the Legislative Chamber of the Federal District to summon the CEO of Iprev to provide clarifications on the matter.

“Our fear is the risk of Iprev shrinking in size and losing investment. The first consequence is that you will need to replenish it. If the resources cease to exist, and that is a risk, the Treasury [of the Federal District] will need to make contributions. Will it stop paying pensions? Not today. But in the worst-case scenario, which would be the liquidation of BRB, Iprev could be left uncovered,” he warns.

Another fact that has generated concern in Brasília in recent days is the revelation that Iprev made investments worth millions in the FIP Venture Brasil Central, a fund managed by Trustee DTVM, an asset manager linked to Master Bank and targeted in the "Carbono Oculto" and "Compliance Zero" operations, both conducted by the Federal Police. Trustee, in turn, belongs to Maurício Quadrado, who was previously a partner at Banco Master.

Iprev reports that it committed to investing R$ 5 million since 2016, but at today's values it would have an amount exceeding R$ 6 million to receive. However, it denies that it was an investment with losses.

“We have already received everything we invested. We have already recovered what we invested. There was no loss. After the Federal Police operations were launched, Iprev no longer invested in the fund. We are awaiting the fund's dissolution,” says Galvão.

*This report was updated at 11:15 AM on Thursday, February 26th, with the correct stock position reflecting the reduction in Iprev's stake in BRB and that of other shareholders.