Bank collapse topples Paraguay's president

Ueno Bank stops working

Ueno Bank's services abruptly stopped in the early hours of Tuesday morning, leaving millions of Paraguayans unable to access their money for everyday transactions.

Millions affected by collapse

Ueno said it had two point nine million customers, around sixty percent of Paraguay's adult population. The Central Bank said the bank had approximately one point eight million depositors.

Slow recovery of funds

By Saturday, authorities said almost one point two million customers had received an advance payment under the state's deposit guarantee fund, but many were still waiting.

Trust in banking collapses

Elizabeth González, a twenty-eight-year-old barista in downtown Asunción, said one customer insisted on paying in cash because he no longer trusted any bank.

“If Paraguayans themselves aren't confident right now, foreign investors will be less so.”

Peña impeached and removed

The collapse led to the impeachment and removal of President Santiago Peña, a close ally of President Donald Trump, and exposed a power struggle inside the ruling Colorado Party.

Ueno's rapid rise

Ueno Bank launched as a fintech in twenty twenty-one and began operating as a bank in November twenty twenty-three.Its rise was driven by slick marketing and a digital model based around convenience and cashback deals.

Public funds at risk

The Social Security Institute, known as IPS, had around three hundred fifty-five million dollars invested in Ueno, roughly nine percent of its portfolio, raising questions about how such a young bank held so much public…

Loans to connected companies

Many of Ueno's loans went to companies directly linked to the bank's controlling owners, Grupo Vásquez, including one hundred forty-six million dollars in loans made to just three companies.

Peña's financial ties

In his asset declaration submitted weeks after taking up the presidency in twenty twenty-three, Peña listed shares in Ueno Holding, then valued at around eight hundred forty-five thousand dollars, representing around one point six percent…

Peña appointed bank's leader

Peña appointed Carlos Carvallo, who had led Ueno Bank, to head Paraguay's Central Bank in twenty twenty-three, creating a conflict of interest that prosecutors later alleged he exploited.

Peña charged and detained

Peña resigned Thursday and was impeached and removed from office Friday.Prosecutors charged him with breach of trust and administration for personal gain.He was ordered held in pretrial detention at a military facility.

Carvallo and executives arrested

Carlos Carvallo was arrested and charged with breach of trust, administration for personal gain and producing false public documents. Eight Ueno executives, including thirty-six-year-old CEO Miguel Vásquez, were also arrested and charged.

Cartes distances himself

Horacio Cartes, the tobacco magnate and former president who had handpicked Peña, publicly distanced himself from him after the collapse, releasing a statement calling for an investigation and insisting there should be no impunity for…

“no impunity for anyone”

Alliana sworn in as president

Vice President Pedro Alliana was sworn in as president to serve out the rest of Peña's term until August twenty twenty-eight, as citizens and activists demand deeper reforms to Paraguay's political establishment.