Paraguay Senate Removes President Santiago Peña After Ueno Bank Collapse

Paraguay's Senate removed President Santiago Peña from office Friday after the collapse of Ueno Bank left nearly three million customers struggling to access their money. Vice President Pedro Alliana was sworn in to replace him.

All 44 senators present voted for Peña's removal, according to AFP and Bloomberg. The impeachment followed a banking crisis that brought protesters into the streets and raised questions about Peña's financial ties to the lender.

Peña was placed under house arrest after his removal, AFP and NPR reported. Prosecutors are investigating allegations involving the bank's supervision and the placement of public funds. Peña denies wrongdoing. His removal from office is a political decision, not a criminal conviction.

The central bank took control of Ueno after its solvency fell below legal requirements. The bank served a large share of Paraguay's adults, including pensioners and people who had opened their first accounts through its digital services.

Alliana promised to compensate affected depositors. AFP reported that an initial phase of payments had begun for some eligible customers, but that did not mean all frozen accounts had been restored or all depositors had received their money.

Peña had offered to resign, but lawmakers proceeded with impeachment. Alliana is set to serve the remainder of the presidential term, through 2028.

The change in leadership leaves Paraguay facing both a financial crisis and an investigation into how the bank was regulated. The outcome of the criminal allegations remains unresolved.