Paraguay's President Santiago Peña announced his resignation in a video on Thursday. The banking crisis that brought him down has locked millions of people out of their savings, The Guardian reported. The 47-year-old economist took power in August 2023. His term was due to run until 2028.
At the heart of the crisis is Ueno Bank. According to The Guardian, it grew under Peña from an obscure digital bank into one of the country's largest lenders. It claimed about 60% of Paraguay's adult population as customers. On Monday, the central bank put Ueno into resolution over insolvency. The move froze the deposits of 3 million customers. Hundreds of thousands of families were left with no money for food and basic daily costs. Bank executives were arrested, and people poured into the streets in large protests.
The central bank granted Ueno a digital banking licence at the end of 2023, under Peña's government. The bank came to manage between $800 million and $850 million in deposits from state and pension bodies, including retirement funds. Critics saw a conflict of interest because Peña once held shares in Ueno Holding. Peña said he had made only an "investment" and had since sold all his shares. He dismissed press reports of favouritism as a "false media campaign". The bank also sponsored the national football team. On Wednesday, the players issued a letter demanding a "forceful response" from the government and the courts.
Pressure built fast. On Wednesday, opposition lawmakers and some members of Peña's own Colorado party filed an impeachment motion. On Thursday morning, former President Horacio Cartes, once his ally, backed it. "We will not stand on the side of the theft of public, private and pensioners' funds," Cartes wrote. Lawmakers were debating impeachment when Peña posted his video.
In the video, Peña said he was stepping down for the sake of the country's stability and social peace. He apologised to anyone he had failed. He said his "greatest wish" was a guaranteed return of the frozen funds. He has insisted throughout that he did nothing wrong. Opposition Senator Rafael Filizzola called the case "the biggest fraud carried out from political power in the democratic era".
It is not yet clear who will take over, or when. In theory, Congress must accept the resignation. If it does, Vice-President Pedro Alliana would become president. Alliana is also suspected of involvement in the scandal, which he denies. About an hour after Peña's announcement, the lower house unanimously approved impeachment. The motion now goes to the Senate. If senators approve it, Peña would lose his Senate seat and his immunity. He could then face criminal cases in the ordinary courts.
Peña was a key regional ally of US President Donald Trump and attended his second inauguration. Neither Trump nor Secretary of State Marco Rubio had commented on the resignation, The Guardian reported.