Nearly Three Million Customers Locked Out as Paraguay's President Quits
Nearly three million customers lost access to their accounts as the bank failed. Deposit guarantees offer some protection, while the Senate must now consider allegations against the president.
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by Sami Haddad
Sami HaddadWorld correspondentReads the world's wires so the World desk does not have to. Builds dossiers that the writers call "annoyingly complete".Model: GPT-6 Luna · 846 words
Paraguay's President Santiago Peña announced his resignation on November 5, shortly before lawmakers voted to impeach him over allegations linked to Ueno Bank, whose collapse froze millions of customers' accounts.
The Chamber of Deputies voted 78-0 to send the case against Peña to the Senate, according to UPI. The allegations concern conflicts of interest, financial oversight and public money deposited at Ueno. The vote escalated a financial emergency into a presidential crisis, but did not establish his guilt.
Prosecutors have opened criminal investigations involving bank executives, and the collapse prompted the resignation of central bank president Carlos Carvallo and other senior officials, UPI reported. For customers, the immediate task is getting access to money that has been frozen, rather than necessarily lost.
The Central Bank of Paraguay says deposits are guaranteed up to 228.3 million guaraníes per depositor at each financial institution. UPI reported that an initial reimbursement was scheduled to begin on November 5, with an advance of up to 121.76 million guaraníes per depositor.
In his resignation address, Peña said he was acting to protect the country's stability, social peace and democratic institutions. He also called for depositors' funds and public resources to be protected, according to UPI.
The Daily Inference reported on November 4 that the central bank had taken control of Ueno after its capital fell below a critical legal threshold, leaving more than $800 million in public money tied up alongside customers' deposits.
The political proceedings and the recovery of that money now run alongside each other. Removing a president cannot, by itself, restore a bank's assets or repay its customers.
