Paraguay’s President Resigns After Ueno Bank Collapse Freezes Deposits for Millions
Paraguayan President Santiago Peña has stepped down amid a political and financial crisis triggered by the collapse and intervention of Ueno Bank, which held about $850 million in public funds and cut off access for roughly three million clients.
President Santiago Peña’s resignation has pushed Paraguay into a sudden change of leadership, driven by public fury over the collapse of Ueno Bank and a deepening crisis in the streets and in parliament.
Peña announced on Thursday that he was leaving office in order, he said, to preserve national stability and democratic institutions. He delivered the message in a video published on November 5, as the Chamber of Deputies was considering impeachment over his role in the scandal.
According to local reporting, Ueno Bank, a financial institution with political links to the president, managed around $850 million in public-sector funds. After the bank was intervened and effectively shut down, some three million account holders lost immediate access to their savings.
Anger over the freeze has spilled into the open. In Asunción, local media reported that police used tear gas and rubber bullets against Ueno customers demanding the return of their money and Peña’s resignation. The clashes underscored how a financial failure had become a broader political confrontation.
Under the constitutional line of succession, Vice President Pedro Alliana now assumes the presidency. Alliana, a 52‑year‑old politician from Ñeembucú with a degree in International Relations, is a long‑time figure in the conservative Colorado Party. He has previously served as governor of Ñeembucú, a national deputy, and party president.
For affected depositors, the central question is when they will be able to withdraw salaries, pensions, and savings locked inside Ueno. Small firms that used the bank for working capital face immediate cash-flow problems, while families who saw it as a safe place for life savings are now forced to wait for decisions on guarantees and payouts.
The crisis also threatens confidence in Paraguay’s financial oversight. A bank that handled large volumes of public money has collapsed under political scrutiny, raising questions about how regulators monitored its risk and governance. The longer depositors remain frozen out, the greater the risk that distrust will spread to other institutions.
Peña’s fall comes as Paraguay is also dealing with sensitive issues such as relations with Taiwan and China, managing Itaipú dam revenues, and confronting organized crime. A government preoccupied with stabilizing the banking system will find it harder to address these other strategic challenges.
The next few days will show whether President Alliana can calm the situation. Key signs will be his appointments to economic and banking posts, any clear timetable for unfreezing or compensating Ueno clients, and decisions in Congress about inquiries into the bank’s collapse. International reactions from lenders and rating agencies will indicate whether they see the damage as contained or expect a wider loss of confidence.
Sources
- OSINT