Thousands of people took to the streets of Paraguay’s capital, Asunción, on Wednesday to protest restrictions on their Ueno bank accounts. Many were pensioners concerned about their savings and funds held at the digital bank by the state social security system. The demonstrations followed violent clashes between protesters and security forces on Tuesday.
Some demonstrators called for President Santiago Peña to be removed from office. On Wednesday, 35 opposition lawmakers filed an impeachment motion, accusing Peña of favoring Ueno and allowing public money to be invested there despite legal restrictions. The opposition does not have the two-thirds majority required to remove him.
The crisis began after Paraguay’s central bank placed Ueno under state control, citing inadequate capital. The bank has around three million customers, whose access to their funds has been restricted. Public institutions also held substantial sums at the bank: the state social security system had about $355 million deposited there, while Ueno managed around $850 million in public funds overall.
Prosecutors are investigating eight bank executives, several of whom have been arrested. Central bank chief Carlos Carvallo also submitted his resignation at Peña’s request. Carvallo had led Ueno before taking charge of the central bank in 2023. Peña, meanwhile, was involved in the corporate group that owns Ueno until 2025. The opposition is calling for an investigation into possible conflicts of interest and political influence.
Peña has rejected the idea that Ueno’s problems signal a crisis across the banking sector, describing them as an isolated case. On Wednesday, he signed a law intended to enable initial payments to affected customers within five days. The central bank initially announced payments of up to 10 million guaraní per customer, equivalent to around 1,300 euros. Peña also canceled plans to attend the Ibero-American summit in Madrid.
Sources: FAZ.