Paraguay lawmakers push impeachment over bank crisis

Paraguay's opposition lawmakers have submitted impeachment articles against President Santiago Pena, accusing him of conflicts of interest and misuse of pension funds linked to the collapse of digital lender ueno.

Thirty-five lawmakers, representing the lower house of 80 seats, have requested an extraordinary session to debate Pena's future, as the crisis continues to deepen the political turmoil.

Pena, a conservative economist who assumed office in 2023, was a shareholder in Grupo Vazquez until March last year. The company controls ueno, a digital lender that expanded into a mid-tier bank managing nearly $850 million in public funds.

The central bank stepped in after finding ueno had breached solvency requirements, leading to a crisis that has left 3 million customers unable to access their accounts in a country of 6.5 million people.

Opposition lawmaker Rocío Vallejo criticized Pena during a congressional session, stating that the president had harmed 3 million people in a single day. The crisis has also undermined Paraguay's reputation as a stable investment destination, particularly from Brazil.

The fallout led to the resignation of the central bank chief and the detention of eight ueno executives, who later turned themselves in. Prosecutors issued arrest warrants, and courts froze their assets as the investigation expanded.

Ueno has not made public statements on the matter and did not respond to a request for comment. Meanwhile, several banking apps experienced outages, raising concerns about confidence in Paraguay's financial system.