President Santiago Peña has resigned following the central bank's seizure of Ueno Bank due to a solvency crisis, triggering widespread protests and impeachment proceedings.
Paraguayan President Santiago Peña resigned on Thursday following a financial and political crisis caused by the collapse of Ueno Bank, a major digital lender. The resignation comes as the country's lower house voted 78-0 to impeach the president, sending the charges to the Senate.
Ueno Bank, which claimed to have approximately 60% of Paraguay’s adult population as customers, was placed into resolution by the central bank after a solvency crisis. Regulators found that the bank's capital fell to less than half the legal minimum after correcting financial statements that included improperly counted expenses and poorly documented loans to companies tied to its owners.
As of last month, Ueno reported holding roughly $800 million in public deposits, including funds from state pension and health entities. The central bank stated that the bank's solvency ratio fell below 50% of the required minimum. The seizure has left approximately 3 million customers with frozen deposits and has impacted an estimated 7,000 direct and indirect jobs, according to the Labor Ministry.
Peña, who served as Minister of Finance from 2015 to 2017, resigned via video, stating, “I do so thinking of the stability of our country, social peace and the need to preserve our democratic institutions.” He also offered an apology to the public, saying, “I also want to apologize to the people if I have failed them at any point.”
Opposition lawmakers and members of Peña’s own Colorado Party filed impeachment motions holding him responsible for the collapse. Former President Horacio Cartes, a former ally of Peña, endorsed the impeachment, stating, “We will not stand on the side of the theft of public, private and pensioners’ funds.”
Under Paraguayan law, if the Senate approves the impeachment, Peña could lose his parliamentary immunity and face criminal proceedings. If the resignation is accepted by Congress, Vice President Pedro Alliana is in line to succeed him to complete the term until August 2028.
Massive protests have occurred in the capital, Asunción, with demonstrators demanding the return of savings and the impeachment of the president. Riot police have used pepper spray and rubber pellets to manage crowds.
The financial turmoil has affected the national currency; the guaraní fell nearly 4% against the U.S. dollar on Thursday, bringing its weekly losses to nearly 7%, according to central bank exchange-rate data. To assist affected citizens, a state guarantee fund was established to repay small accounts of up to approximately $1,600 within five business days.
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
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Paraguay's Attorney General has ordered three criminal investigations into the Ueno Bank collapse, including allegations involving President Santiago Peña, who resigned Thursday as the lower house voted to impeach him.
