A bank that grew faster than its books
Paraguay's Senate voted 44 to 0 on Friday to remove President Santiago Peña, one day after he resigned. The trigger was the collapse of Ueno Bank, a digital lender that had grown into one of the country's largest banks by courting first-time customers with supermarket rebates. More than a million Paraguayans held accounts there.
When the bank failed this week, about three million people — close to half the population — lost access to their money. Hundreds of millions of dollars in public funds were frozen with it.
Charges follow the vote
Prosecutors charged Peña on Saturday with breach of trust, influence peddling and misappropriation of funds. He is accused of steering public deposits into the bank and of a conflict of interest in his dealings with it. He pleaded not guilty and was ordered held at a military facility in Asunción while the investigation continues.
The Senate found him guilty of dereliction of duty. Forty-four of 45 senators voted for removal, with one absent, and members of his own Colorado Party joined the majority.
Alliana takes over a bank cleanup
Vice President Pedro Alliana was sworn in as president and will serve out the term until August 2028. He promised that people hit by the collapse would be fully compensated. That promise is not simple to keep: Alliana belongs to the same party as Peña and is himself under investigation over the bank's failure. Protesters outside Congress have carried signs against both men.
The new government also inherits a collapse of confidence. Depositors want their savings back, and the central bank has to decide how far the state will go to cover losses at a private lender. A broad bailout could strain public finances in a country that has kept borrowing costs low and the currency stable for years.
Peña, 47, was seen as a business-friendly reformer. His fall from president to defendant in 48 hours leaves investors watching whether the institutions that moved so quickly can also deliver the money.