Ueno Collapse Leaves Millions Locked Out as Peña Faces Senate

Ueno Bank’s collapse left nearly 3 million customers unable to withdraw cash, make digital payments or use bank cards, while Paraguay’s Senate resumed an impeachment trial that could remove President Santiago Peña from office. Senators rejected Peña’s request for 72 more hours to answer accusations tied to the lender. The people whose savings are frozen get no extra time or access from the political machinery now deciding who stays in power.

People protested in Asunción and other cities, clashing with police and demanding Peña be held accountable. Ueno had nearly half of Paraguay’s population as customers. Regulators seized the bank before dawn Tuesday, Nov. 3, and the central bank called its failure an isolated case while saying the broader financial system was safe.

Millions Locked Out, Officials Under Scrutiny

The charges against Peña cite his close ties to Ueno, which grew from a little-known lender into one of Paraguay’s largest banks in a few years and took in more than $800 million in public funds. Lawmakers point to Peña’s stake in Ueno’s holding company, which he sold last year, his appointment of a former Ueno executive to run the central bank that regulated the lender, and allegations that he allowed public pension deposits at the bank to exceed legal limits.

Prosecutors opened three criminal investigations into the collapse Thursday, including complaints against Peña, Vice President Pedro Alliana and current and former officials at the central bank and state pension fund. Former Ueno CEO Miguel Vázquez has been charged with crimes including breach of trust and attempted fraud. A judge ordered six bank directors held in pretrial detention. Police and prosecutors raided company offices in Asunción and towed nine luxury vehicles from Vázquez’s home early Friday.

Peña’s top aides resigned as he prepared to defend himself before the Senate. Interior Minister Enrique Riera resigned late Thursday, Nov. 5; Peña’s chief of staff, Javier Giménez, and legal adviser, Roberto Moreno, quit Friday. Peña said he received the summons only hours before the session, along with about 300 pages of accusations and evidence, leaving him no time to hire a lawyer or review the case. “That is not due process,” he wrote on X.

A Senate Trial, and a Door to Immunity

The lower house voted 78-0 to impeach Peña and send the case to the Senate. Conviction requires 30 votes in the 45-member Senate. After Peña’s allies determined Thursday they lacked the votes, they walked out, leaving too few lawmakers to proceed and Peña in office. His allies wanted Congress to approve his resignation; opponents wanted the Senate to convict and oust him.

Paraguay’s Constitution gives a president who resigns rather than being removed through impeachment a seat as senator for life, with parliamentary immunity that could shield him from prosecution. Vice President Alliana, who survived his own impeachment attempt Thursday, would serve out the term through August 2028 either way. The contest over resignation or conviction therefore carries consequences beyond who occupies the presidency: the constitutional route could also affect Peña’s exposure to prosecution.

Political Allies, Public Consequences

By Thursday afternoon, Peña had offered to resign as members of his own party turned against him. “It was never my intention to betray the trust you placed in me,” he said in a video address. Former President Horacio Cartes, Peña’s mentor and the patriarch of the long-ruling conservative Colorado Party, publicly supported Peña’s ouster.

Bloomberg reported that Peña tendered his resignation after the dramatic collapse of local fintech Ueno Bank SA, with which he had ties, and said he faced a criminal investigation into his role in what it described as Paraguay’s biggest financial scandal in years. Bloomberg also reported that about two weeks earlier Peña had boasted Paraguay had “the best numbers” in Latin America while preparing to give the keynote address at a gala in Washington.

The central bank’s assurance that the wider financial system was safe sits alongside millions of customers unable to use their accounts and allegations involving public deposits, political ties and regulatory appointments. The Ueno collapse has plunged Paraguay into its deepest political crisis in more than a decade. The Senate can decide Peña’s position; the frozen savings and inaccessible payments remain the immediate reality for customers.