RegAlert

Rule · BCB · 15 May 1984 · Circular 859

Circular No. 859 - Private Fixed Income Securities

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The Central Bank prohibits financial institutions from conducting operations commonly known as "carteirões" or private fixed income portfolios, defined as public fund-raising involving guaranteed liquidity and profitability backed by a portfolio of fixed-income securities without individualized ownership by clients. The prohibition also extends to selling ideal fractions of the same fixed-income security to multiple clients. Institutions holding non-compliant positions at the time of publication must gradually reduce them within a maximum period of 90 days, subject to case-by-case examination by the Central Bank.

BrazilBanco Central do Brasil

CIRCULAR NO. 000859

We communicate that the Board of Directors of the Central Bank, in a session held on May 9, 1984, decided to clarify that it is prohibited for financial institutions and other entities authorized to operate by this Body to carry out operations commonly known as "carteirões," "private fixed income portfolio," "non-individualized securities portfolio," and other similar expressions. These are understood as fund-raising from the public that involve guarantees of liquidity and profitability, backed by a portfolio of fixed-income securities where there is no individualization of securities ownership by clients.

  1. It is also prohibited to sell ideal fractions of the same fixed-income security to various clients.

  2. Institutions that have, on the date of publication of this Circular, operations in disagreement with these provisions shall gradually reduce these positions, so that, within a maximum period of 90 (ninety) days, upon examination of each case by the Central Bank, the provisions of this Circular are duly met.

  3. Circular Letter No. 198, of November 16, 1976, is hereby revoked.

Brasília-DF, May 15, 1984

José Kléber Leite de Castro José Luiz Silveira Miranda Director Director

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Circular Letter No. 198 —Prohibits Operations Known as "Ca…1976 · BCBCircular Letter No. 198 — Prohibits Operations Known as "Carteirões" and Similar Fixed-Income Portfolios (1976-11-16)Circular No. 859 - PrivateFixed Income Securities1984-05-15 · this documentCircular No. 859 - Private Fixed Income Securities (1984-05-15)
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Supersedes

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This document supersedes: Circular Letter No. 198 — Prohibits Operations Known as "Carteirões" and Similar Fixed-Income Portfolios

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