Paraguay faces a profound political and financial crisis after the Central Bank intervened in Ueno Bank on November 3, 2026, freezing the assets of nearly three million customers. The collapse, triggered by a severe capital insolvency, has disrupted daily transactions and prompted an immediate move toward the impeachment of President Santiago Peña.
The crisis began in the early hours of Tuesday, November 3, when Ueno Bank’s digital application—used by millions of customers in Paraguay—abruptly ceased operations. Instead of account balances, users were met with a blank screen and a message stating, “We cannot show the balance.” The Central Bank of Paraguay (BCP) announced the intervention at 03:24 a.m., citing a solvency index that had plummeted below 50% of the required minimum. By mid-week, the crisis had intensified the political pressure on President Santiago Peña, who took office in 2023.
The Mechanics of a Financial Shutdown
The scale of the disruption is immense. With approximately 2.9 million clients—equivalent to nearly half of the country’s 6.1 million inhabitants—Ueno Bank served as a cornerstone of the domestic economy. The bank processed more than 3 million daily transactions and held approximately $850 million in public deposits, including funds from the Social Security Institute (IPS) upon which over 32,000 retirees depend. Before the collapse, the bank had aggressively captured media attention and sponsored major football clubs, including Defensores del Chaco, Cerro Porteño, and Olimpia. For many, the closure was instantaneous; even hours before the intervention, the bank was aggressively soliciting new deposits with promotional offers, leaving many customers like accountant Rocío Zárate unable to access funds transferred just the night before.
The BCP has moved to activate a resolution process, though the immediate impact on the streets of Asunción and beyond has been chaotic. Customers have crowded bank branches across the country, finding them shuttered and under guard. In Ñemby, the tension peaked when a 45-year-old client shattered a glass door at a branch while seeking information about his savings. Late Tuesday, protesters gathered in downtown Asunción with placards calling for the impeachment of the president.
| Category | Key Data Point |
|---|---|
| Customer Base | Approx. 2.9 million (approx. 60% of adult population) |
| Solvency Trigger | Below 50% of regulatory minimum |
| Deposit Guarantee | Up to 75 minimum monthly wages (approx. $37,700 – $38,200) |
| Immediate Payout | First tranche of up to 10 million guaraníes (approx. $1,675) |
Political Consequences and Presidential Pressure
The fallout has reached the highest levels of government. Carlos Carvallo, the president of the Central Bank, resigned shortly after the intervention. His previous role as president of the financial institution Ueno before his appointment to the BCP in 2023 has drawn scrutiny. President Peña—who previously held shares in the group that controlled Ueno Bank before divesting in 2025—now faces a formal impeachment process.
On Wednesday, November 4, the situation took a sharp turn when Horacio Cartes, the former president and leader of the ruling Colorado Party, announced that his party would support the impeachment proceedings. “As president of the National Republican Association, we will not be on the side of the looting of public, private, and retiree funds,” Cartes stated. “Debemos pensar en la gente y en los valores que sostenemos desde el Partido Colorado,” he added on social media. The Cámara de Diputados has scheduled extraordinary sessions to address the accusations against Peña.
Executives Arrested Amid Trust and Compensation Delays
While the government has pledged to utilize the Deposit Guarantee Fund to reimburse savers—noting that roughly 97% of depositors fall within the coverage limits—the lack of immediate access has eroded public trust. The Central Bank has promised that depositors will receive an initial payment of up to 10 million guaraníes.
The legal response has been swift. On Wednesday, police detained eight high-ranking executives of the bank, including CEO Miguel Vázquez. Vázquez’s lawyer, Víctor Dante Gulino, stated, “Él quiere someterse a la justicia,” after escorting his client to the Investigations Department in Asunción. Commissioner Hugo Grance, head of the department, noted, “Será alojado en una de las dos celdas de seguridad que tenemos.” The authorities have emphasized that the priority remains the protection of small depositors, with BCP officials promising to deploy all necessary resources to expedite the return of funds. Following the scandal, President Peña suspended a planned trip to Madrid for the 30th Ibero-American Summit to address the domestic emergency.
