Paraguay lawmakers reject president’s resignation push impeachment
Paraguay’s political turmoil escalated after lawmakers dismissed President Santiago Peña’s resignation request, opting instead to pursue his removal from office. The move follows revelations linking Peña to the failed digital lender Ueno Bank, whose collapse triggered widespread financial distress across the country.
The Senate scheduled Peña’s appearance before Congress on Friday as part of the impeachment proceedings. Ueno Bank, which handled deposits for approximately 60% of Paraguay’s banking customers, shut down after regulators exposed insider lending practices and a severe capital deficit. The failure stranded millions of account holders, unable to withdraw their savings.
An investigation by Última Hora uncovered that Peña had previously held shares in Ueno Holding, worth about $800,000, and maintained deposits at the bank before formally disclosing their sale in 2025. His brother, Francisco Peña Palacios, remains a significant shareholder in Luxembourg-based U Holdings S.à r.l., the entity controlling the bank.
Prosecutors have issued arrest warrants for top executives, including Ueno’s founder, Federico Miguel Vázquez, though it is unclear whether he has been taken into custody. The bank has already drained approximately $850 million in public funds, prompting regulators to seize control of its operations due to insolvency.
In a televised address, Peña announced his resignation, framing it as a measure to stabilize the nation and restore public trust. He expressed remorse for the crisis and pledged to push for the recovery of funds for affected depositors, emphasizing that his decision aimed to safeguard democratic institutions. Lawmakers rejected the resignation, compelling Peña to participate in impeachment hearings to defend his position.
Regulatory and Legal Actions Following Ueno Bank’s Failure
Paraguayan authorities have taken control of Ueno Bank’s operations due to its insolvency, following the discovery that its capital levels fell below legal thresholds. The central bank will maintain oversight as part of efforts to address the bank’s financial instability.
Prosecutors have issued arrest warrants for key figures associated with Ueno, including its founder, though their status remains uncertain. The bank’s collapse has also drawn attention to Vice President Pedro Alliana, who is now positioned as the potential successor under constitutional rules.
