The Collapse of Ueno Bank in Paraguay: Frozen Accounts, Arrests, Impeachment and President Peña's Resignation

The morning of November 3: the bank stopped showing balances

Early on Tuesday morning, November 3, at around 03:24, the app of the Paraguayan bank Ueno stopped displaying the accounts of nearly three million clients, showing only the message 'We cannot display the balance.' At the same time the Central Bank of Paraguay announced external administration and the start of liquidation proceedings for the institution: as Euronews reported, the trigger was a critical collapse of the bank's solvency ratio below 50%. Central bank board member Liana Caballero confirmed at a press conference: 'We have begun closing the institution; neither the app, nor the cards, nor any services are working as of today.'

Frozen savings and the ghost of 'corralito'

The scale of the crisis for a country with a population of just over six million is enormous: according to Euronews, Ueno served about 2.94 million clients — roughly 60% of the adult population — and Deutsche Welle specifies that in the previous month the bank declared about 800 million dollars in public-sector deposits — roughly a quarter of all deposits, including funds from hydroelectric plant operators. The bank also held about 850 million dollars in state funds, including money from the Social Welfare Institute (IPS), of which, according to IPS finance manager Gladys Vera, cited by DW, 355 million dollars — about 9% of IPS investments. Crowds of clients gathered at the headquarters in Asunción and at 75 branches across the country; authorities reminded people of the guarantee fund, which returns up to 75 minimum wages (about 37,700 dollars) to each client, but, as Euronews notes, distrust had already taken over the streets — protesters carried placards reading 'Who will answer for a lifetime's savings?' On Thursday, hundreds of Ueno employees and staff of companies in the parent conglomerate protested outside the labor ministry, demanding unpaid wages.

Impeachment, the resignation of the central bank chief — and the president's resignation

The political consequences were immediate. At the request of 35 deputies — opposition members and dissidents from the ruling Colorado Party — the 80-seat Chamber of Deputies convened an extraordinary session to vote on opening impeachment proceedings: this required 53 votes in the lower house and then two-thirds of the Senate. The charges against Santiago Peña include conflict of interest, alleged embezzlement of pension funds, and institutional protection of the central bank. DW provides additional details: deputies cited two loans Peña received from Ueno, his sale of a stake in Ueno Holding in April 2025, as well as the fact that Carlos Carvalho, whom he appointed central bank chief in 2023, had previously headed Financiera Ueno, and the company's conversion into a bank was approved just 83 days after his appointment. On Wednesday, the president canceled all meetings, announced the resignation of the central bank chief, demanded that the courts establish accountability, and promised in a video address legislation that would 'return to every depositor what they are owed as quickly as possible'; the crisis forced him to cancel his participation in the Ibero-American Summit in Madrid. According to Deutsche Welle, on Thursday Peña resigned after support was withdrawn by Congress President Basilio Núñez and ruling party leader Horacio Cartes. Euronews, in its November 5 publication, does not mention the resignation — at that point it only reported on the upcoming vote.

Arrests and a blow to the economy

On Wednesday, eight senior bank executives were detained, including founder and CEO Miguel Vásquez; DW adds that among those detained was also the bank's president, Juan Manuel Gustale, and the prosecutor's office brought charges — including breach of trust and attempted fraud — against 27 more bank officials and businessmen linked to it. Lawyers for the detainees said they needed time to study the charges. The economic consequences became apparent immediately: the Association of Importers and Traders warned of an immediate 35% drop in sales at the country's large stores — with funds frozen, domestic consumption halted overnight. The contrast is telling: just days earlier, the bank had announced a $100 million capitalization plan, however, as the Superintendence of Banks found, it failed to secure the mandatory $70 million reservethat the central bank required. The bank itself was highly visible far beyond the financial sphere — it sponsored the country's leading football clubs, Cerro Porteño and Olimpia, as well as the Defensores del Chaco stadium. Peña, a technocrat economist and former IMF employee, came to power in 2023 with a promise to turn the country into a magnet for foreign capital; under him Paraguay showed one of the highest growth rates in South America, but the banking collapse confronted him with the most critical moment of his presidency.