Maqbool Ibrahim — November 10, 2026
Paraguayan President Santiago Pena was unanimously impeached, removed, and arrested on Friday. This comes after the Ueno Bank, Paraguay’s largest digital lender, collapsed. The failure froze the savings and commerce of 3 million people (a third of Paraguay’s adult population), plunging the nation into economic and political uncertainty. Vice President Pedro Alliana has been sworn in as interim leader until the term ends in 2028.
As of Sunday, November 8th, the Central Bank maintains the Ueno collapse was an isolated incident. However, public trust in Paraguay is rapidly decreasing. As the New York Times reports on Bencicia Sosa, 56, outside of Paraguayan Congress: “I woke up on Tuesday without being able to do anything, without a single peso.”
Pena’s remarkable downfall comes down to his close ties to Ueno. As Reuters reports, Pena held approximately one million dollars of shares in Ueno’s parent company. While he sold the shares in 2025, critics argue he spent his first two years shaping national policies to benefit his investment. Due to this, in a video statement published online on November 5th, 1:16 p.m., Pena attempted to step down, to maintain political stability.
“I want to apologize to the people if I ever failed you,” said Mr Pena. “It was never my intention to betray the trust in me you had placed.”
Congress overwhelmingly rejected Pena’s heartfelt resignation. Just minutes following Pena’s videos, lawmakers voted unanimously to proceed with impeachment. The president’s own conservative Colorado Party withdrew its support of the President, as critics blasted his resignation as a blatant attempt to maintain his Constitutional Immunity and “systemic dereliction of duty.”
On Tuesday, Ueno executive Miguel Vasquez and senior leaders were arrested on attempted fraud. Before this, Ueno’s rise had been remarkable. It had grown from a “niche fintech” to a “midsized bank serving 3 million customers.” Under the Pena administration, the government relaxed rules to funnel public funds into Ueno. At the time of its collapse, it contained 800 to 850 million dollars of deposits, almost half of which belonged to the state pension fund. Thousands of retirees were blocked from their disbursements. Furthermore, when Pena gained office, he appointed former Ueno CEO Carlos Carvallo as head of the Central Bank, essentially removing independent investigation. Carvallo faces impeachment and trial after his resignation was declined.
On November 3rd, 3:23 a.m., the Central Bank seized Ueno and placed it under resolution. They soon found massive irregularities, and when accounting mistakes were corrected, the bank’s solvency fell to half of the state’s minimum. Money for millions of Paraguayans was frozen instantly.
“I feel heartbroken,” said Ms. Sosa, a mother to eight children. “We don’t know where to turn. We can’t live on water alone. We have kids, we have grandchildren. We all depend on the bank.” She had been attracted by Pena, who had promised to create half a million jobs. “This economy is going to hell.”
Critics believe Ms. Sosa may have been right. On a macroeconomic level, Ueno’s collapse threatens to undo years of economic growth and frighten investors from the corruption-plagued country. As the New York Times explains, the economy grew 6.6 percent in 2025, the fastest for any Latin American country, save oil-rich Guyana. Due to Ueno’s collapse, the currency fell nearly 5%.
Looking forward, Pena may attempt to flee Paraguay, likely to the United States where he holds close ties to Donald Trump. Alliana faces the daunting mountain of regaining public trust and stabilizing the economy, as waves of political unrest are sweeping across Latin America.
For the common person, however, the Ueno Bank collapse has upended their savings, careers, and lives, plunging them into uncertainty. As Reuters reports on citizen Felipe Rodriguez: “Peña is playing with savers’ money. This cannot go unpunished.”
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