Paraguay's president Santiago Peña resigns after Ueno Bank collapse

Congress opened removal process after regulators found bank short on reserves

Paraguay’s President Santiago Peña resigned Thursday after the collapse of Ueno Bank, an online lender closely tied to him, upended the country’s politics. Regulators had revealed that Ueno Bank lacked enough reserves to cover the risks associated with lending, and the lower house of Congress had begun the process of removing Peña from office.

Ueno Bank had built a sizable online presence, and its end came abruptly. The bank closed on Tuesday, and depositors were unable to access their accounts, The Wall Street Journal reported.

The closure brought depositors into the streets of the capital, where street demonstrations broke out in Asunción after people found they could not reach their accounts.

The congressional response was already under way. The lower house of Congress had begun the process of removing Peña from office this week, and The Wall Street Journal reported that Peña faced near-certain impeachment in Congress as he resigned.

Peña announced the decision in an address on X. “I have made the decision to submit my resignation as president of Paraguay,” he said. “I want to apologize to the people if I have failed them at any point. It was never my intention to betray the trust that they placed in me.”

Peña’s financial ties to the failed bank were substantial. A Columbia University-trained economist who took office in 2023, he held a large stake in Ueno Bank’s parent company, Grupo Vázquez. Peña said he cut ties to the firm in 2025 as it faced scrutiny.

Paraguay is one of Washington’s closest allies in South America, with a strong, export-driven economy, and Peña expanded already tight ties with Washington during his term. The Wall Street Journal said the bank’s collapse dealt a blow to that economy.

The account The Wall Street Journal gave of the week places the regulators’ disclosure at the start of the crisis and the president’s resignation at the end, with the bank’s collapse and the demonstrations in the capital in between.

Peña’s announcement came with the removal process in the lower house already open and the financial questions behind the crisis unresolved: regulators found the reserve shortfall, and depositors could not reach their accounts when the bank closed.