After a major banking crisis, Paraguay dismisses its president, Santiago Peña, and appoints its vice-president, Pedro Alliana
The ex-president is placed under house arrest then transferred to a military installation; his successor promises to compensate savers
Quick Look
- The Paraguayan Senate impeached Santiago Peña for his responsibility in the Ueno Bank crisis and installed Pedro Alliana as new president the same day.
- The ex-president, under house arrest, must be heard for breach of trust, influence peddling and management for personal gain.
- Nearly three million depositors are affected by the asset freeze.
AI-generated summary
Why It Matters
Santiago Peña had been president of Paraguay since 2023, a close ally of Washington, and his mandate ended in principle in 2028. The banking crisis broke out on Tuesday with the central bank (BCP) placing Ueno Bank under supervision for insolvency, freezing the deposits of nearly three million people. Pedro Alliana, vice-president until then and from the same Colorado Party, was inaugurated president after the impeachment.
Paraguay inaugurated a new president, Pedro Alliana, on Friday, November 6, after the dismissal the same day of his predecessor, Santiago Peña, for his responsibility in a major banking crisis. Pedro Alliana, who until then was vice president, affirmed in his first brief speech before the Senate that "the compatriots who are going through a very difficult situation because of the financial chaos will be fully compensated. We will not leave them alone."
President of Paraguay since 2023, close ally of Washington, Santiago Peña, 47, whose mandate in principle ended in 2028, was dismissed after the Senate unanimously recognized him guilty of "poor exercise of his functions", in connection with the debacle of a flourishing online bank in recent years, Ueno Bank. The banking crisis, which quickly turned into a deep political crisis, broke out on Tuesday with the Central Bank (BCP) placing Ueno under supervision for insolvency.
Breach of trust and influence peddling
The BCP's intervention froze the deposits of nearly three million people, the number of customers Ueno claimed was almost half the country's population. Companies, institutions and pension funds have also been affected.
Pedro Alliana, 52, from the same Colorado Party (conservative) as Santiago Peña, had also been implicated in the banking crisis, but Parliament had not approved an impeachment trial.
Barely an hour after his dismissal, the ex-president was placed under house arrest. Then, late Friday night, he was transferred from his home to a military installation for security reasons. Prosecutor Silvia Margarita González Vester announced to journalists that the deposed president would be heard on Saturday by the prosecution for the alleged crimes of breach of trust, influence peddling and management for personal gain.
During the impeachment trial, senators accused the ex-president of having "permitted, tolerated and failed to correct a diversion of pension funds to a bank linked to the presidential circle". In other words, "having subordinated the public interest to private interests", launched Senator Adrián Vaesken. Santiago Peña was also, even before his presidency and until 2025, a shareholder in the financial holding company that owns Ueno Bank, senators recalled.
What to Watch
AI outlook — possibilities, not facts
Santiago Peña will be heard by the prosecution on Saturday for breach of trust, influence peddling and management for personal gain.
Very likely · Within hours
Pedro Alliana will set up a compensation mechanism for compatriots affected by the financial chaos.
Likely · Within weeks
Open Questions
- What will be the final fate of the frozen deposits of three million Ueno Bank customers?
- What criminal sanctions does Santiago Peña face precisely for breach of trust, influence peddling and management for personal gain?
- How will the new government manage to compensate affected savers?
