Paraguay Senate removes President Santiago Peña over Ueno Bank scandal
Vice President Pedro Alliana has been sworn in following the unanimous impeachment of Peña over allegations of misconduct.
The Paraguay Senate voted unanimously on Friday to remove President Santiago Peña from office following the collapse of Ueno Bank. According to the Hindustan Times, the 44 senators present voted to oust him, paving the way for Vice President Pedro Alliana to take over the presidency.
Lawmakers accused Peña of using political influence to direct hundreds of millions of dollars in public funds into the digital lender while allowing risky lending practices. The Hindustan Times reported that the bank's failure froze the savings of nearly 3 million customers and triggered widespread protests.
Peña had submitted his resignation on Thursday, but the lower house voted 78 to 0 to impeach him instead. The Moneycontrol reported that prosecutors have since ordered Peña's arrest on suspicion of breach of trust, while also targeting former central bank chief Carlos Carvallo.
Peña has denied any wrongdoing. In a farewell message on X, he stated he resigned to prevent further instability and said he did not want his presence to cause more division, though he did not accept responsibility for the crisis.
The banking collapse has had significant economic impacts, with the guaraní losing nearly 7 per cent against the US dollar over the week. The Moneycontrol noted that Ueno had accumulated approximately $850 million in public funds, including pension resources.
Pedro Alliana will serve the rest of the term, which ends in August 2028. Meanwhile, Paraguay's largest teachers' union plans to begin an indefinite national strike on Monday to demand protection for public pension funds.