Paraguayan President Santiago Peña resigned on Thursday following the collapse of a prominent digital financial institution with which he had been associated in the past. The event put enormous pressure on him, as nearly half of the country's population lost access to their bank accounts, UNN reports, citing Reuters.
In a video address released on Thursday, Peña said he was resigning "out of concern for the stability of our country, social peace, and the need to preserve our democratic institutions."
The fallout from the collapse of the institution, which was called "ueno," has already led to the resignation of the head of the Central Bank of Paraguay and the detention of eight ueno executives.
The crisis dealt a blow to Paraguay's reputation—a country that had worked hard to establish itself as a stable destination for foreign investment, particularly from neighboring Brazil. Following news of the resignation, prices of Paraguay's international sovereign bonds fell sharply.
Opposition lawmakers called an extraordinary session for Thursday to begin impeachment proceedings in Congress, while protesters demanded Peña's resignation.
Peña, who is a supporter of U.S. President Donald Trump, lost the backing of members of his own conservative party ahead of the impeachment debate.
Despite the president's resignation, the session proceeded as planned. The lower house of parliament approved Peña's impeachment while rejecting a similar motion against Vice President Pedro Alliana, who, under the procedure, is to assume the presidency following Peña's resignation.
The matter now moves to the Senate, which is due to vote on the impeachment proceedings later on Thursday. Peña's decision to resign must also be approved by the Senate.
The impeachment process could delay Pedro Alliana's assumption of the presidency in place of Peña.
Lawmakers accused Peña of a conflict of interest, the misuse of pension funds, and concealing facts at the institutional level—all of it linked to the collapse of "ueno." The institution rapidly transformed from a niche fintech project into a mid-sized bank managing approximately $850 million in public funds.
"My most ardent wish is for the return of these funds to be guaranteed, for the deposit guarantee fund to fulfill its purpose, and for public funds—as well as resources belonging to all Paraguayans—to be protected," Peña said in his address. The Central Bank of Paraguay intervened in ueno's operations, determining that it had violated minimum solvency requirements. This triggered a crisis in which approximately 3 million of the company's customers—in a country with a population of 6.5 million—lost access to their accounts.
Ueno has not yet made any public statements on the matter.
Peña, an economist elected to office in 2023, came under intense political scrutiny because of his past business ties to the bank that collapsed. Peña was a shareholder in Grupo Vázquez, the group that owned the bank until March 2025.
Peña repeatedly denied any improper connections. He characterized the situation as a political escalation of a problem that was initially purely technical and regulatory in nature, and said that any violations should be addressed through the courts.
In a message to clients, JPMorgan bank said that events surrounding ueno had "quickly taken on a political dimension," adding that the risks to the financial system as a whole would depend on the authorities' response being "swift and transparent."