Paraguay's president resigns days after Ueno Bank collapse freezes accounts

Paraguay's president has quit. Santiago Peña announced on Thursday that he has resigned, just two days after one of the country's banks fell apart and left millions of people cut off from their savings.

What happened?

Peña shared a video address on his social media accounts. He said his priority is the "peace of mind of Paraguayans" who trusted their savings to the country's financial system. He also said he backs a "guaranteed return of those funds".

The trigger was Ueno Bank. On 3 November, Paraguay's Central Bank imposed external administration on it because of serious solvency problems (in plain terms, the bank could not cover its obligations). Accounts of about three million customers were frozen.

Why is everyone talking about it?

The numbers are huge. Paraguay has just over seven million people, so three million frozen accounts means almost half the population was affected.

People took to the streets. Mass protests swept the country, and demonstrators demanded that the president step down. The opposition went further and submitted a proposal in parliament to impeach him, meaning to remove him from office.

On 5 November it also became clear that lawmakers from the ruling party had turned their backs on the president. That left him with very little political cover.

Where did this start?

Peña, of the Colorado Party, took office on 15 August 2023 after winning the April 2023 election. His term ended abruptly after just over three years, and the cause was a banking collapse rather than a vote.

What's next?

The key question for ordinary people is simple: when will they get their money back? Peña has publicly called for a guaranteed return of the funds, but no details have been given on how or when that would happen.

The Central Bank's external administration of Ueno Bank remains in place, and the accounts of its customers are still frozen.