Paraguay is in a political crisis after the collapse of one of its biggest banks. President Santiago Peña announced his resignation on Thursday, Nov. 5, but Paraguay’s Congress never accepted it. That leaves him still in office and facing a Senate impeachment trial set to continue Friday, Nov. 6.
“I have made the decision to submit my resignation as president of the republic,” Peña said in a video posted to X, according to NBC. Hours later, he said he would appear before the Senate to defend himself.
How the crisis started
On Tuesday, Nov. 3, Paraguay’s central bank seized Ueno Bank, a digital lender. Regulators found poorly documented loans to companies linked to the bank’s owners, NBC reported. Once the books were corrected, the bank’s capital fell below half of the legal minimum.
The impact was huge. Ueno had about 3 million customers, which 3News reported is roughly 60% of adults in Paraguay. Its app, cards and transfers stopped working, and its branches closed. Many depositors could not get to their savings. The bank also held pensions and public money. NBC reported Ueno had about $800 million in public deposits. Officials said about 280,000 customers who banked only with Ueno were being given accounts at other banks, and the central bank voted to move remaining funds to other institutions.
“We have more than three million Paraguayans who have been harmed,” one ruling party lawmaker said, according to Euronews.
Why Peña is under pressure
Lawmakers accuse Peña of a conflict of interest. According to 3News, he held a stake in Ueno’s parent company, Grupo Vázquez, until March 2025. Peña says he sold those shares, and he denies wrongdoing. Carlos Carvallo, whom Peña had picked to run the central bank, previously led Ueno’s predecessor company, NBC reported. Carvallo has resigned.
Prosecutors have charged 27 bank officials and business associates with offenses including breach of trust and attempted fraud, and eight senior executives were detained, NBC reported. The attorney general has also ordered three criminal investigations into how the bank was overseen and how public funds ended up there. Peña says he will cooperate, according to 3News.
A resignation that did not take effect
In Paraguay, Congress must accept a president’s resignation. On Thursday, the joint session called to do so lost its quorum when members of Peña’s own Colorado Party walked out, The Rio Times and 3News reported. Some Colorado senators said they wanted a trial instead.
The stakes are high. Under Paraguay’s constitution, a former elected president becomes a senator for life, with some legal immunity, unless he is convicted in an impeachment trial. 3News noted Peña could have kept that seat if his resignation had been accepted.
Meanwhile, the Chamber of Deputies voted 78-0 to impeach Peña, according to the Christian Post, and the Senate opened the trial Thursday night. Removing him takes 30 of the 45 senators. Senate President Basilio Núñez said the trial could end the same day as Peña’s defense, the Christian Post reported.
Peña has asked that depositors be repaid no matter what happens to him. He wrote on X that payment to savers “cannot stay pending on what happens to me,” according to The Rio Times.
Who would take over
If Peña is removed, Vice President Pedro Alliana would serve out the term, which runs through August 2028. Lawmakers rejected an impeachment request against Alliana, 48 to 30, the Christian Post reported.
Anger has spilled into the streets. Hundreds of retirees, depositors, students and workers marched in the capital, Asunción, and riot police used pepper spray and rubber pellets, NBC reported. Ueno employees also protested over unpaid wages and severance.
Why it matters for families
When a bank fails, ordinary people feel it first: retirees waiting on pensions, workers waiting on paychecks and parents trying to buy groceries. Paraguay’s crisis is a reminder of why bank oversight matters. For families anywhere, it is also a good moment to learn how deposits are protected where you live and to keep some savings plans and emergency cash in mind.
What to watch next
All eyes are on the Senate on Friday. Watch whether Peña appears in person, whether 30 senators vote to remove him, and how quickly depositors get their money back. This is a developing story, and Upstormed News will follow it.
Read more: Spain’s transport minister quits after train crash kills 69, including 4 Americans. Also in world news: Hong Kong activist Joshua Wong sentenced to 10 more years.
What do you think leaders owe the public when a crisis like a bank collapse happens on their watch?
Sources: NBC Los Angeles, “Paraguay President Santiago Peña resigns following bank collapse” (November 5, 2026); Christian Post, “Paraguay’s President Peña offers resignation over bank collapse, then vows to fight impeachment” (November 5, 2026); Euronews, “Paraguayan president resigns amid bank collapse leaving 3M people without access to bank accounts” (November 5, 2026); The Rio Times, “Paraguay’s President Stays Despite Quitting” (November 5, 2026); 3News, “Congress rejects Santiago Peña’s resignation after Ueno collapse” (November 6, 2026)
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