The key facts

  • Ueno Bank has been placed under external administration and is being liquidated: solvency fell below 50%, and the bank failed to meet the mandatory 70-million-dollar reserve
  • The bank held about 850 million dollars in state funds, including funds of the Institute of Social Security; sales at large stores fell by 35%
  • 35 deputies initiated a vote on impeaching President Peña; eight bank executives were detained, led by CEO Miguel Vázquez

The bank went down overnight

Early on Tuesday morning, November 3, at around 03:24, the app of Paraguay's Ueno Bank stopped showing the accounts of nearly three million clients, displaying a single message: “We cannot show the account balance.” At the same time, the Central Bank of Paraguay announced that the institution was being placed under external administration and that a liquidation procedure was beginning. The reason was a critical drop in the solvency ratio — below 50%. This was reported by Euronews.

850 million dollars in state funds and the specter of the “corralito”

According to Euronews, the bank held about 850 million dollars in state funds, including the funds of the Institute of Social Security, which finance pensions and health insurance for workers. This evoked associations among the population with Argentina's “corralito” — the freezing of deposits. Central bank board member Liana Caballero confirmed: “We have begun closing the bank; neither the app, nor the cards, nor any other service will work from today.” The authorities reminded that the guarantee fund covers each client up to 75 minimum wages (about 228 million guaraníes, or 37,700 dollars), but this did not ease the tension: from Tuesday evening, crowds gathered at the head office in Asunción and at 75 branches across the country, demanding their money back.

Impeachment, arrests, and a blow to the economy

The political consequences proved unprecedented for Santiago Peña's government. At the request of 35 deputies, the Chamber of Deputies is convening an extraordinary session to vote on opening impeachment proceedings: this requires 53 votes in the lower chamber and then the support of two-thirds of the Senate. The president is charged with “improper performance of duties” — from a conflict of interest and the alleged misappropriation of pension funds to institutional protection of the central bank. Peña himself canceled his official schedule on Wednesday and remained silent until the evening, when he announced the resignation of the central bank chief and demanded that responsibility be established through the courts. That same day, eight top managers of the bank were detained, including CEO Miguel Vázquez.

The advertising facade versus the accounting reality

The collapse also hit the real economy: the Association of Importers and Traders reported an immediate 35% drop in sales at large stores — with funds frozen, domestic consumption came to a virtual standstill overnight. The contrast is telling: just days earlier, the bank — owned by the influential Grupo Vázquez and sponsoring the leading football clubs Cerro Porteño and Olimpia, as well as the Defensores del Chaco stadium — had announced a 100-million-dollar recapitalization plan. However, as the Superintendence of Banks found, it failed to meet the mandatory 70-million-dollar reserve required by the central bank. For Peña — an economist and former IMF official who came to power in 2023 with a promise to turn the country into a magnet for foreign capital — this is the most critical moment of his presidency, Euronews notes.