Banco de Brasília (BRB) has signed a memorandum of understanding with Quadra Capital to create an investment fund to which it plans to transfer assets received from Banco Master, with a reference value of BRL15bn ($3bn), the bank said in a filing. The move is aimed at supporting BRB’s capital position and liquidity, Reuters reported.

Under the terms outlined, between BRL3bn and BRL4bn would be paid in cash, while the remainder would be converted into subordinated shares in the fund, which will manage and seek returns from the assets. Completion of the transaction depends on conditions set out in the agreement.

The development follows a federal police investigation involving former BRB chief executive Paulo Henrique Costa. Authorities arrested him on April 16 on suspicion of negotiating BRL146mn in bribes in a scheme linked to Banco Master.

The case forms part of Operation Zero Compliance, which began in November and also involves Banco Master owner Daniel Vorcaro, who is in custody.

Banco Master was placed into liquidation by the central bank in the same period, and Costa was removed from his role by court order. His lawyer, Cleber Lopes, said the defence maintains that his client committed no wrongdoing.