Paraguay Impeaches President Santiago Peña, Places Him Under Arrest Over Banking Crisis

Paraguay has impeached and removed President Santiago Peña from office following a major banking crisis linked to the collapse of digital lender Ueno Bank, which reportedly left nearly three million customers unable to access their money.

The country’s Senate voted 44-0 on Friday, November 6, to remove Peña over allegations of misconduct and poor performance in office.

Following his removal, Vice President Pedro Alliana was sworn in as the new president to complete the remainder of Peña’s tenure, which runs until August 2028.

Naija News reports that the impeachment followed mounting public anger over the collapse of Ueno Bank and allegations of conflicts of interest, misuse of public funds and institutional failures surrounding the financial institution.

Paraguayan lawmakers accused Peña of having links to the bank through Grupo Vázquez, its parent company, and questioned the handling of public funds deposited with the financial institution.

The banking crisis reportedly affected approximately three million customers in a country with a population of about 6.1 million, leaving thousands of individuals, businesses and pensioners struggling to access their deposits.

Following the impeachment, authorities placed the former president under arrest at his residence on the orders of the Prosecutor General’s Office.

He is being investigated over allegations bordering on breach of trust, influence peddling and misappropriation of funds in connection with the supervision of Ueno Bank and the placement of public funds in the institution.

Peña has denied allegations of wrongdoing and conflict of interest.

Before his removal, the former president had announced his resignation amid growing pressure from opposition lawmakers, protesters and members of his own political party. However, lawmakers proceeded with the impeachment process.

Meanwhile, newly sworn-in President Alliana has promised that customers affected by the banking crisis will receive full compensation.

He assured citizens that his administration would prioritise recovering their funds and restoring confidence in the country’s financial system.

The crisis has also triggered widespread protests in Asunción and other parts of Paraguay, with demonstrators demanding accountability and the return of their savings.

The political fallout has extended to other senior government officials, including the departure of the Central Bank Governor, Carlos Carvallo, and Interior Minister Enrique Riera, while several bank executives have also been arrested.

The development marks a major political turning point for Paraguay, as the country begins a new administration amid growing demands for financial accountability and institutional reforms.