Paraguay President Steps Down After Ueno Bank Collapse

Overview

• The Central Bank intervened in Ueno Bank after inspectors found its solvency ratio well below legal minimums, and the action suspended account access for roughly three million clients.
• Prosecutors ordered the detention of eight bank directors after investigators uncovered large, irregular loans to companies linked to the Grupo Vázquez and apparent accounting manipulations.
• The crisis rapidly turned political when public protests and loss of party support forced President Santiago Peña to announce his resignation and prompted the Chamber of Deputies to open impeachment proceedings.
• Carlos Carvallo, who led the central bank and had previous ties to Ueno, resigned and other cabinet members stepped down as authorities work to secure deposits and restore basic banking services.
• Regional concern is growing with Brazil saying it will work pragmatically with vice‑president Pedro Alliana if he assumes the presidency, and markets and investors reassessing Paraguay's regulatory and sovereign risk.