Paraguayan President Santiago Pena resigned on Thursday following the central bank’s takeover of Ueno Bank, a crisis that cut millions of citizens off from their savings and triggered days of unrest across the country.
The Bank Takeover That Sparked a Crisis
The turmoil began on Tuesday, when Paraguay’s central bank assumed control of Ueno Bank, citing a severe capital shortfall. The intervention left roughly three million depositors, including pensioners, unable to access their money. Long queues of customers seeking withdrawals stretched along the streets of Asuncion on Tuesday and Wednesday, while angry demonstrations filled the capital on both evenings.
Impeachment Pressure and a Party’s Reversal
Opposition lawmakers moved swiftly, submitting an impeachment request against Pena on Wednesday. They accused him of favouritism toward the bank in regulatory and pension fund decisions. Pena had previously held shares in a group that controlled the bank, though he sold them last year. On Thursday, his own Colorado Party backed his removal as Congress debated the impeachment request. “In the face of these accusations, I can’t pretend to be oblivious,” said ruling party deputy Alejandro Aquilera during the debate. “We have more than three million Paraguayans who have been harmed, who feel betrayed, swindled, deceived.”
A Resignation and an Apology
In a video announcing his resignation on X, the right-wing president said: “I want to apologise to the people if at any point I failed. It was never my intention to betray the trust you placed in me.” He added that his priority was “the peace of mind of Paraguayans who entrusted their savings to our financial system.”
Measures That Fell Short
Before stepping down, Pena sought to calm the situation by requesting the resignation of Central Bank president Carlos Carvallo, who subsequently left his post. He also enacted a law setting a limit of five business days for returning most of the funds to depositors. The central bank said the takeover was intended to “protect depositors and preserve the stability of the financial system.” Nevertheless, the measures proved insufficient. Hundreds of demonstrators in Asuncion demanded his removal and clashed with police, who responded with tear gas and water cannons.
What Comes Next
Pena, who served as finance minister before becoming president in 2023, will be replaced by Vice President Pedro Alliana, who now takes the lead of the South American nation.
