Court blocks public property use in BRB bank rescue plan

A judge in Brasília has halted a rescue plan for the city's struggling bank, at least for now. On Monday, the Federal District's court suspended a law signed just days earlier by Governor Ibaneis Rocha that would have allowed the government to sell, transfer, or pledge nine public properties to shore up the BRB—the Bank of Brasília—which has been hemorrhaging money since losses tied to the Master case. The properties, valued together at roughly 6.6 billion reais, were meant to be the centerpiece of a real estate investment fund that would inject capital into the bank and stabilize its balance sheet.

Judge Daniel Eduardo Branco Carnacchioni, ruling from the District's public finance court, issued the suspension in response to a legal challenge filed by opposition figures including Ricardo Cappelli, a PSB party leader and potential gubernatorial candidate, and Rodrigo Rollemberg, a former governor now serving in Congress. Their argument was straightforward: the law, as written, exposed the public treasury to serious risk. It authorized the transfer of assets between state-owned enterprises without any formal study of the consequences—no analysis of what would happen to the properties being given up, no assessment of how their loss might degrade public services, no accounting for the damage that might ripple through other government agencies.

In his written decision, the judge zeroed in on this gap. The problem, he wrote, was not the law's intent but its practical effect. By allowing the government to strip assets from one state enterprise to rescue another, it created the conditions for what he called a "sacrifice" of public patrimony—a transfer that could ultimately harm the people the government is supposed to serve. The judge noted that there was no evidence anyone had studied whether moving these properties would weaken other agencies or compromise the quality of services they provide. That absence of due diligence, he suggested, was itself a form of potential abuse of power.

The suspension is provisional, meaning it can be revisited as the case moves forward through the courts. But for now, it blocks what the BRB's leadership had counted on as their primary strategy for survival. The bank had been banking on the real estate fund to generate the liquidity it desperately needed. Without access to those nine properties, the institution faces a much narrower set of options for raising capital. The court's intervention forces the bank and the governor's office back to the drawing board, even as the underlying financial crisis at the BRB remains unresolved. What happens next depends on how the full case develops—whether the court ultimately upholds the suspension or allows the law to proceed, and whether the bank can find alternative sources of funding in the meantime.