Paraguay’s President Impeached Following Bank Collapse

President Santiago Peña of Paraguay faced impeachment and house arrest following the collapse of Ueno Bank, a significant U.S.-owned financial institution with connections to the country’s government. This collapse affected millions, leaving many Paraguayans without access to their funds.

Peña, recognized as a pro-market leader and a close ally of Washington, was a shareholder in Ueno Bank. The bank was a digital lender serving about three million customers—over half of Paraguay’s adult population. Ueno Bank had promoted itself by offering substantial cash-back deals on groceries and had assisted more than a million people in opening their first bank accounts.

Allegations arose that Peña jeopardized state assets and benefited personally through his ties to the bank. Amid the turmoil, Peña denied any unlawful activities but announced his resignation, which lawmakers rejected. Instead, they pursued impeachment. The Senate found him guilty of malfeasance unanimously, leading to further legal accusations including a breach of trust.

I want to apologize to the Paraguayan people if I have failed you,

Peña expressed on social media.

The aftermath saw widespread protests in Asunción, the capital. Demonstrators even burnt Pepeña’s image in protest. In response, Vice President Pedro Alliana was sworn in as the new president, committing to actions compensating those affected by the bank’s failure.

The central bank of Paraguay intervened on Tuesday, citing Ueno Bank’s inability to meet legal solvency requirements, a key measure of financial stability. This intervention prompted public demonstrations, marking a tense period for the nation.