Paraguay's president resigns after the collapse of one of the country's central banks

Paraguayan President Santiago Pena resigned on Thursday, days after the collapse of one of the country's central banks, according to what was reported by the Associated Press.

The collapse led to Ueno Bank being placed under receivership.

Pena announced his resignation in a video clip he posted on the “X” platform, explaining that he was stepping down from his position in order to preserve the stability of the country and its democratic institutions.

He said: “I have taken the decision to submit my resignation from the position of President of the Republic, and I am taking this step out of concern for the stability of our country, social peace, and the necessity of preserving our democratic institutions.”

Despite offering an apology, Pena did not acknowledge that he was responsible for the banking crisis, as he said: “I would also like to apologize to the people if I had failed them at any stage, as I never had any intention of betraying the trust they placed in me.”

He stressed that his priority is to ensure that depositors recover their savings, noting that “behind every deposit are years of hard work, sacrifices, and families’ dreams.”

The opposition in Paraguay submitted a memorandum to remove President Santiago Peña from office, against the backdrop of the central bank’s seizure of a large, troubled bank with which the president had previously had connections.

The decision to seize Ueno Bank on Tuesday deprived millions of depositors, including retirees, of access to their money and savings.

Peña, who belongs to the right-wing movement, previously owned shares in a group that controls Ueno Bank, but he sold them last year.

Agence France-Presse quoted Mauricio Espinola, a representative who defected from the ruling party, as saying that the impeachment request, which is based on accusations of misconduct and conflicts of interest, was signed by 35 opposition representatives in Congress.

He added that Congress will hold a session to discuss this memorandum on Thursday morning.

In order to proceed with the proposed impeachment procedures against President Peña and his vice president, Pedro Aliana, the approval of at least 53 members out of 80 in the House of Representatives is required, after considering the charges against them.

If approved, the memorandum will move to the Senate, where it will need the approval of 30 out of 45 members.

The party to which President Peña belongs has a majority in both chambers of the Council.

Ueno Bank says it has more than three million customers, roughly half of Paraguay's population, and also manages millions of dollars allocated for pensions, in addition to other government funds.

The Central Bank explained that it took control of Ueno Bank due to a severe shortage of capital, with the aim of “protecting depositors and maintaining the stability of the financial system.”

The authorities suspended the bank's services while they work to arrange procedures for depositors' recovery of their money.

In this context, Central Bank Governor Carlos Carvalho, who previously headed Ueno Bank, submitted his resignation on Tuesday, at the request of Peña.