Paraguay President Santiago Peña Resigns Amid Banking Crisis, Protests

Paraguayan President Santiago Peña has announced his resignation following a banking crisis that left millions of depositors unable to access their savings and triggered protests across the South American country.

The crisis followed the Central Bank’s takeover of Ueno Bank on Tuesday over what it described as a severe capital shortfall, sparking public outrage and long queues of customers seeking to withdraw their money.

About three million depositors, including pensioners, were reportedly affected by the restrictions.

Opposition lawmakers on Wednesday submitted an impeachment request against Peña, accusing him of favouritism towards the bank in regulatory and pension fund decisions.

Announcing his resignation in a video posted on X on Thursday, the president apologised to citizens, saying he never intended to betray the trust placed in him.

“I want to apologise to the people if at any point I failed. It was never my intention to betray the trust you placed in me,” he said.

Peña added that his priority was to restore confidence among Paraguayans who entrusted their savings to the country’s financial system.

The president previously held shares in a group that controlled Ueno Bank but reportedly sold them last year.

His own Colorado Party also backed his removal on Thursday as Congress debated the impeachment request.

During the debate, ruling party deputy Alejandro Aguilera said the allegations against the president could not be ignored, while lawmakers expressed concern over the millions of depositors affected by the crisis.

The Central Bank had defended its takeover of Ueno Bank, saying the action was necessary to protect depositors and preserve the stability of the financial system.

In an attempt to ease tensions, Peña had requested the resignation of Central Bank President Carlos Carvallo, who subsequently stepped down.

He also signed a law limiting the period for the return of most depositors’ funds to five business days.

However, the measures failed to calm public anger, as hundreds of demonstrators took to the streets of the capital, Asunción, demanding his removal.

The protests later turned violent, with police deploying tear gas and water cannons to disperse the crowds.

Peña, who previously served as finance minister, became president in 2023.

Vice-President Pedro Alliana is expected to succeed him as Paraguay’s leader.