The Library Media — National & World · World Desk
By Maya Wilson
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How a bank collapse left millions in limbo and toppled Paraguay’s president
Asunción — Ueno Bank’s services stopped abruptly early on Tuesday. The bank said it had 2.9 million customers, about 60% of Paraguay’s adult population. The Central Bank counted about 1.8 million depositors. Those are different measures, and the difference matters.
By Saturday, almost 1.2 million customers had received advance payments under the state deposit guarantee. Many were still waiting.
The collapse has left millions in limbo. It has also brought down a president, a central bank chief and the executives of the bank itself.
Paraguay’s Social Security Institute, the IPS, had about $355 million invested in Ueno, about 9% of its portfolio. Former finance minister Manuel Ferreira said many loans went to companies linked to the controlling owners, Grupo Vásquez, including $146 million to just three companies.
President Santiago Peña held Ueno Holding shares worth about $845,000, about 1.6% of paid-up capital in his 2023 asset declaration. He sold them in March 2025. He appointed former Ueno head Carlos Carvallo to run the Central Bank. Prosecutors allege Peña influenced agencies to keep deposits at the bank.
Peña left office last week under impeachment pressure and was removed by the Senate on Friday. The account of events does not establish a cleaner sequence than that. Prosecutors have charged him with breach of trust and administration for personal gain. He has pleaded not guilty and is held in pretrial detention at a military facility.
Vice President Pedro Alliana was sworn in to serve until August 2028. Carvallo and eight Ueno executives, including chief executive Miguel Vásquez, 36, were also arrested and charged.
Former president Horacio Cartes, who handpicked Peña, publicly distanced himself, calling for an investigation and “no impunity for anyone.” His faction backed the removal the next day.
The bank at the centre of the crisis was not a traditional lender. It was a fintech-turned-bank that had grown to hold the savings of about 60% of Paraguay’s adults. Its abrupt failure exposed the scale of its reach, and the fragility of the system that had allowed it to grow.
The deposit guarantee has provided advance payments to almost 1.2 million customers, but many remain waiting. The IPS, which manages the pensions and healthcare of Paraguay’s workers, has about $355 million at stake. The loans to companies linked to Grupo Vásquez raise questions about how the bank’s funds were used.
The political consequences have been swift. Within a week, the president, the central bank chief and the bank’s executives were in detention. The charges against Peña, and the arrests of Carvallo and the Ueno executives, suggest that the investigation is not limited to the bank’s collapse, but extends to the relationships between the bank, the government and the regulators.
For Paraguay, the crisis is both financial and political. The collapse of a bank that served 2.9 million customers, or 1.8 million depositors by the Central Bank’s count, has left millions waiting for their money. The removal of a president and the detention of senior officials have left the country with a new leader and a series of unanswered questions about how a bank could grow so large, and fail so quickly.
(Maya Wilson — Intelligence Lead, The Library Media)
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