Paraguay president resigns and is impeached over bank failure
The country's lower house voted to remove Santiago Peña from office shortly after he stepped down following the central bank's seizure of Ueno Bank.
By Alessia Romano ·
President Santiago Peña of Paraguay faced a double political blow on Thursday when the national lower house voted unanimously to impeach him, a move that occurred minutes after he announced his resignation.
The rapid collapse of his administration followed a banking crisis that began on Tuesday. Paraguay's central bank seized control of Ueno Bank, citing a severe lack of capital. This intervention froze the accounts of approximately three million depositors, including many pensioners, who were suddenly unable to access their savings.
Opposition lawmakers filed for impeachment on Wednesday, alleging that Peña showed favoritism toward the bank in regulatory decisions and pension fund management. Although Peña sold his shares in the group controlling Ueno last year, critics pointed to his previous role as finance minister and his ties to the institution.
In a video posted on X, Peña apologized for any failures during his term. He stated that his main goal was to ensure the peace of mind for citizens who had trusted the financial system with their money. The announcement came as public frustration reached a peak in the capital, Asuncion.
Protesters had gathered for two consecutive evenings, with lines of people waiting to withdraw funds stretching out from Ueno branches. Clashes between demonstrators and police resulted in the use of tear gas and water cannons. Peña had tried to stabilize the situation by removing Central Bank president Carlos Carvallo and passing a law to return most frozen funds within five business days, but these steps did not stop the unrest.
Even members of Peña's own Colorado Party supported his removal during the Thursday debate. Deputy Alejandro Aquilera argued that the president could not ignore the accusations given the scale of the damage. He noted that more than three million Paraguayans felt betrayed and swindled by the events.
Peña, who took office in 2023, will be succeeded by Vice President Pedro Alliana. The central bank stated that the takeover was necessary to protect depositors and maintain the stability of the national financial system.
