Paraguay Senate Removes President Santiago Peña From Office After Ueno Bank Collapse

Paraguay’s Senate voted on Friday to remove President Santiago Peña from office, a day after he offered to resign, and the former president will remain under house arrest while prosecutors pursue three criminal cases tied to the collapse of Ueno Bank.

Forty-four of the 45 senators voted to remove Peña, according to CNN. Vice President Pedro Alliana was sworn in as president soon after the vote.

The prosecutor’s office said it ordered Peña’s arrest in connection with the bank crisis. He will remain under house arrest until a judge decides where he should stay while the criminal process goes forward, prosecutor Christian Benítez said.

Attorney General Emiliano Rolón Fernández opened three cases to investigate the supervision and resolution of Ueno Bank, the placement of public funds in the bank, and the actions of state officials, CNN reported. The impeachment vote strips Peña of his parliamentary immunity.

Resignation came as impeachment moved ahead

Peña offered his resignation on Thursday after Ueno Bank was shut down overnight, leaving millions of customers unable to reach their money. He announced the decision in a video posted on social media.

“I have made the decision to submit my resignation from the Presidency of the Republic. I do so with the stability of our country, social peace, and the need to preserve our public institutions in mind,” Peña said.

The lower house of Congress had accused him of “serious and systematic dereliction of duty” in his dealings with the bank. The Chamber of Deputies voted unanimously to start impeachment proceedings soon after he announced his resignation.

Peña asked the Senate for 72 hours to prepare his defense. Lawmakers rejected the request, and his lawyers, Adolfo Ferreiro and Ricardo Preda, represented him before the Senate. Peña himself did not attend the vote.

Bank collapse froze millions of accounts

Paraguay’s central bank intervened in Ueno on Tuesday after finding that the bank’s solvency ratio had fallen below 50 percent of the required minimum, according to CNN. The bank had about 2.9 million customers in a country of 6.1 million people, and the intervention froze their savings.

Ueno also administered roughly $850 million in public funds, including money linked to state institutions and pensions, Reuters reported. Eight Ueno executives faced arrest warrants and later turned themselves in, and the head of the central bank was forced out.

Peña had past business ties to Grupo Vázquez, the group that owned Ueno until March 2025. He has said he sold his stake in the group that month and had no improper role in the bank’s affairs. He denies wrongdoing and has said the affair was a regulatory matter for the courts.

Opposition lawmakers accused Peña of conflicts of interest, misuse of pension funds, and helping shield the bank from scrutiny. Senator Yolanda Paredes told reporters before the vote that Peña should be jailed and that an arrest warrant must be issued.

The guarani weakened past 6,500 per dollar after the resignation and closed at 6,490, down nearly 5 percent on the day, while sovereign bond prices fell, Reuters reported.

A U.S. State Department spokesperson said the relationship between the two countries remains strong and that Washington looks forward to continuing close cooperation on shared priorities, CNN reported.

Reporting based on coverage by CNN and Reuters.