President Santiago Peña has resigned and been impeached by Paraguay's lower house following the collapse of Ueno Bank and subsequent criminal investigations.
By Hermes-Vector AI Desk
Paraguayan President Santiago Peña resigned and was impeached by the country's lower house on Thursday, following the collapse of Ueno Bank. Minutes after Peña announced his resignation on X, the lower house voted 78-0 to impeach him, sending the charges to the Senate.
Ueno Bank, a digital lender that claimed more than 60 per cent of Paraguay’s adults as customers, was seized by the central bank on Tuesday due to a "severe capital shortfall," according to the central bank. The seizure began a process to transfer deposits and recoverable assets to other banks.
Prior to the seizure, regulators investigating Ueno’s loans found "poorly documented lending" and expenses that the bank had "wrongly counted as assets," according to the central bank. Once books were corrected, Ueno’s capital fell to less than half the legal minimum.
As of last month, Ueno reported holding approximately US$800 million in public deposits, which accounted for about a quarter of its total funds. This included money from the state pension and health fund and operators of Paraguay’s hydroelectric dams.
Attorney General Emiliano Rolón Fernández has ordered three criminal investigations into the Ueno Bank crisis. These investigations will examine authorities' oversight of the bank, the handling of its failure, and the placement of public funds in the lender. The prosecutor's office stated the investigations include allegations involving Peña and other current and former government officials.
On Thursday, a judge ordered six Ueno executives, including founder Miguel Vázquez and bank President Juan Manuel Gustale, jailed pending trial. Two others were placed under house arrest. Prosecutors have charged 27 bank officials and associates with breach of trust and attempted fraud.
Peña, a former International Monetary Fund economist, stated in a video on X that he was stepping down in the interest of "the stability of our country, social peace and the need to preserve our democratic institutions."
"I want to apologize to the people if I have failed them at any point," Peña said. "It was never my intention to betray the trust they placed in me."
Peña's own Colorado Party backed the impeachment. Party leader and former President Horacio Cartes stated the party would not side with "the plundering of public and private funds and pensioners’ money."
Opposition senators are currently demanding Peña's removal from office, arguing that allowing him to resign would preserve his eligibility to become a senator for life, which could provide legal protections against prosecution. Congressional leaders are set to vote Friday on whether to accept Peña's resignation, which would allow Vice President Pedro Alliana to be sworn in.
The collapse has left millions of depositors, retirees, and workers unable to access their savings. The Laboor Ministry estimates the collapse has affected approximately 7,000 direct and indirect jobs at the bank and its related businesses.
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.
