Peña steps down as impeachment pressure mounts
Santiago Peña announced his resignation as president of Paraguay on Thursday through a video posted on social media, as Congress was preparing to debate an impeachment request against him. The move followed the central bank's decision to dissolve Ueno Bank, a financial institution with links to Peña's former business associates. In his message, Peña said he was acting to protect the country's stability, social peace and democratic institutions, and he apologized to Paraguayans if he had failed them at any point.[S1][S2][S3][S4][S5][S6]
The final blow came from Horacio Cartes, former president and leader of the governing Colorado Party, who announced that the party would support the impeachment trial. Cartes said the party would not side with the looting of public, private and pension funds and argued that the move was needed to restore institutional order. The impeachment request had been filed by 35 legislators, including opposition and dissident ruling-party members, and the Chamber of Deputies later approved it unanimously and sent it to the Senate.[S1][S6][S7][S8]
How Ueno Bank grew and why it collapsed
Ueno Bank traces its origins to Financiera El Comercio, founded in 1976. The Grupo Vázquez acquired the financiera in April 2021, with authorization from the Central Bank of Paraguay in September of that year, and two years later it obtained permission to operate as a bank. In 2024 it absorbed Visión Banco, adding more than a million customers, an extensive branch network and one of the largest deposit bases in the Paraguayan financial system. By September 2026 the bank claimed more than three million customers in a country of 6.5 million people and said it processed over three million transactions a day.[S1]
On Tuesday the Central Bank announced the start of dissolution proceedings after determining that Ueno's solvency ratio had fallen below half the required minimum. The bank had around 2.9 million customers and managed between 800 and 850 million dollars in public funds, according to Associated Press. The closure left depositors unable to access their accounts, prompted protests in Asunción and raised concerns about the fate of state and pension fund deposits. Prosecutors ordered the arrest of Federico Miguel Vázquez Villasanti, president of Grupo Vázquez, who turned himself in, along with several bank directors including Juan Manuel Gustale.[S1][S2][S3][S6]
Political and financial fallout
The crisis intensified because of the ties between Peña, the former central bank president Carlos Carvallo Spalding and the Ueno group. The opposition accused Peña of conflicts of interest, allowing the misuse of pension funds and covering up irregularities. Peña had been a shareholder in the controlling company until 2025, which became a central argument for his critics. Orkun Saka, a financial economics researcher at City St George's, University of London, said the case went beyond mismanagement: a bank owned by a single conglomerate ended up holding the savings of most adults in the country and hundreds of millions of dollars in pension funds, while the central bank had warned months earlier about excessive lending to companies linked to the owners.[S1][S3]
The Chamber of Deputies had scheduled a vote on whether to admit the impeachment accusation, but Peña's resignation came before it could proceed. The Senate was set to decide whether to continue the process, accept the resignation or ratify the vice president. The episode has left Paraguay facing questions about how a bank that grew so rapidly could collapse, how public funds ended up concentrated in a single institution and what it means for the independence of the country's regulators.[S1][S4][S6]
