by Stefan J. Bos, Worthy News Chief International Correspondent
ASUNCIÓN, PARAGUAY (Worthy News) – Paraguayan President Santiago Peña faced impeachment proceedings Friday after announcing his resignation following the collapse of one of the country’s largest digital banks, leaving millions unable to access their savings.
Peña offered to step down Thursday, but Congress did not accept his resignation, leaving him facing a Senate impeachment trial over alleged connections to the failed lender, ueno Bank.
The president, who took office in 2023, announced his resignation after losing support within his conservative Colorado Party, including from influential party leaders backing efforts to remove him.
He said he wanted to preserve national stability and democratic institutions while urging authorities to ensure that affected customers recovered their money.
The crisis erupted after Paraguay’s central bank intervened in ueno, citing serious financial irregularities and a failure to meet minimum solvency requirements.
MILLIONS OF ACCOUNTS FROZEN
This rapidly expanding lender served approximately 3 million customers in a country of roughly 6.5 million people and administered around $850 million in public funds, including money linked to state institutions and pensions.
Its collapse froze access to accounts, sparked street protests and raised fears about the safety of savings and the wider banking system.
Authorities detained eight senior bank executives, while prosecutors charged 27 bank officials and associates with offenses including breach of trust and attempted fraud.
The central bank’s president also resigned amid mounting criticism of regulatory oversight.
Opposition lawmakers accused Peña of conflicts of interest, misuse of pension funds and helping shield the bank from scrutiny.
PRESIDENT DENIES WRONGDOING
Peña denied wrongdoing, saying he had sold his stake in Grupo Vázquez, the business group previously controlling ueno, in March 2025.
He maintained that allegations involving the lender should be addressed through the judicial system.
His attempted resignation did not end the political confrontation. Paraguay’s lower house unanimously approved impeachment proceedings Thursday, sending the case to the Senate, which opened the trial and summoned Peña to present his defense Friday.
Financial turmoil also unsettled investors, with Paraguayan sovereign bond prices falling and the national currency, the guarani, closing nearly 5 percent lower against the U.S. dollar Thursday.
The banking crisis has threatened Paraguay’s reputation as one of South America’s more stable economies and raised questions about the management of public funds.
DEPOSITORS AWAIT COMPENSATION
Prosecutors have opened three criminal investigations into the bank’s collapse, including allegations involving Peña and other officials, adding to pressure on the government.
Authorities also face growing demands to restore access to deposits, protect public savings and determine responsibility for the lender’s failure.
Officials have begun compensating depositors through a state-backed guarantee fund, which is expected to cover the full balances of about 97 percent of customers.
Paraguay now faces an uncertain political future as lawmakers pursue impeachment despite the president’s announced resignation.
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