Peña Resigns as Paraguay Congress Unanimously Impeaches President Over Ueno Bank Collapse
The president stepped down hours after the central bank seized control of a lender linked to his former holdings, leaving three million depositors without access to their funds.
By Sarah Reynolds ·
President Santiago Peña resigned from the presidency of Paraguay on Thursday, minutes before the lower house voted unanimously to impeach him. The removal follows a financial crisis triggered by the state takeover of Ueno Bank, a lender connected to Peña’s former business interests.
The central bank assumed control of Ueno Bank on Tuesday, citing a severe capital shortfall that threatened the stability of the national financial system. The intervention blocked access to accounts for approximately three million depositors, including many pensioners who rely on those funds for daily living expenses.
Protests erupted in the capital, Asuncion, immediately after the bank seizure. Long lines of citizens formed outside Ueno branches on Tuesday and Wednesday as they attempted to withdraw cash. Angry crowds gathered in the streets on both evenings, demanding answers from the government regarding the management of the institution.
Opposition lawmakers filed a formal request for impeachment on Wednesday. They accused Peña of showing favoritism toward Ueno Bank in regulatory decisions and the handling of pension funds. Although Peña sold his shares in the group that controlled the bank last year, critics argued his prior influence contributed to the institution’s weakness.
In a video posted to the social media platform X, Peña expressed regret for the disruption. He stated, “I want to apologise to the people if at any point I failed. It was never my intention to betray the trust you placed in me.” He described his priority as securing the peace of mind for Paraguayans who had entrusted their savings to the financial system.
Peña attempted to calm the unrest by requesting the resignation of Central Bank president Carlos Carvallo, who subsequently stepped down. He also signed a law limiting the time to return most funds to depositors to five business days. These measures did not stop the demonstrations, which turned violent in Asuncion as police used tear gas and water cannons against hundreds of protesters.
The ruling Colorado Party, which had previously supported Peña, voted in favor of his removal on Thursday. Deputy Alejandro Aquilera of the ruling party stated during the debate, “In the face of these accusations I can't pretend to be oblivious.” Vice President Pedro Alliana will now assume the presidency, following Peña’s service as finance minister before his 2023 election.
