Paraguay’s Senate removed President Santiago Peña from office on Friday and prosecutors placed him under house arrest, capping a week of political turmoil triggered by the collapse of digital bank ueno.
Forty-four of the Senate’s 45 members voted to remove Peña, who was ousted about an hour before his successor was sworn in. Vice President Pedro Alliana, 52, took the oath of office as Paraguay’s 53rd president and will serve out the remainder of the term, which ends in August 2028.
Peña had offered his resignation on Thursday, but the Senate chose to complete the impeachment process rather than accept it. The impeachment charges accused him of conflicts of interest, manipulating regulatory oversight, diverting pension funds and taking part in an institutional cover-up involving the central bank. Peña has denied any wrongdoing, saying the affair was a regulatory issue.
Prosecutors said the final charges against the former president were still being determined but could include influence peddling and breach of trust. Peña was ordered to appear at the prosecutor’s office on Saturday morning. Dozens of protesters gathered outside his home in Asunción as police set up a security cordon around the property.
The attorney general has opened three criminal cases against Peña and other former officials over the bank crisis. Prosecutors also issued an arrest warrant for Carlos Carvallo, the former head of Paraguay’s central bank, who ran the finance company that became ueno until Peña named him central bank chief in 2023. Eight former ueno executives have already been detained.
The crisis began when the central bank intervened in ueno, a lender launched in 2021 that grew rapidly into a bank serving around three million customers in a country of 6.5 million people — nearly half the population. The bank was put into resolution after breaching minimum solvency requirements, freezing access to accounts that included state benefits paid to pensioners.
Peña, 47, an economist elected in 2023, was until last year a shareholder in ueno’s holding company. The central bank has denied any conflict of interest, saying Carvallo recused himself from all decisions related to the bank.
Demonstrators have taken to the streets of Asunción demanding accountability for the collapse and faster compensation for depositors whose savings remain frozen, chanting “We want our money”. Some account holders began recovering their money on Thursday, and regulators have sought to reassure markets by guaranteeing most deposits and containing risks to the wider financial system.
Brazil, Paraguay’s largest economic partner, is watching the transition closely. A Brazilian government source told Reuters its immediate concern was avoiding social instability and ensuring the banking crisis is resolved without wider unrest.
Sources: Reuters, via Devdiscourse (https://www.devdiscourse.com/article/international/4003039-paraguay-swears-in-new-president-as-peais-put-under-house-arrest); CNN (https://www.cnn.com/2026/11/05/americas/president-paraguay-resigns-latam-intl).
