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Paraguay has appointed former Vice President Pedro Alliana as its new president following the impeachment of Santiago Pena over a banking crisis that left millions of people unable to access their money.
Senators appointed Alliana shortly after voting to remove Pena over the collapse of Ueno Bank, a financial institution linked to his former business interests.
Senate President Basilio Nunez declared Pena guilty of poor performance in office after 44 of the 45 senators voted in favour of his impeachment. One senator was absent.
Hundreds of people gathered outside Congress celebrated the decision.
“Justice has been done. Now we want him to give us back our money and go to jail,” Jessica Aquino, 32, told AFP.
Authorities placed Pena under house arrest minutes after his removal, prosecutor Silvia Margarita Gonzalez Vester told reporters.
Credit: Reuers
In his first address, Alliana promised that the government would not abandon the nearly three million depositors affected by Ueno Bank’s takeover amid concerns about its financial position.
“Compatriots who are now going through a difficult time as a result of the financial collapse will be fully compensated,” Alliana said.
He will remain president until 2028.
Opposition lawmakers had also submitted a motion to impeach Alliana over the crisis, but the proposal failed to secure congressional approval.
Money begins returning to depositors
The collapse of Ueno Bank triggered protests across Paraguay, with thousands of people demanding accountability from Pena, who had links to Grupo Vazquez, the company that controlled the bank.
Until last year, Pena held a stake in the business group.
The Central Bank began making advance payments to some affected depositors on Thursday afternoon, an official told AFP.
Jose Maciel, an official with the Central Bank’s Deposit Guarantee Fund, said the first phase of payments would cover up to approximately $1,600.
The initial payments will go to customers who have no outstanding loans and hold accounts with other banks or financial institutions in Paraguay.
Maciel said other beneficiaries would be announced gradually as the payment process continued.
Pena had offered to resign over the crisis, but lawmakers continued with impeachment proceedings, stripping him of his political immunity.
Opposition lawmakers accused him of having a conflict of interest, an allegation he denied.
The Attorney General’s office said it was investigating him over “acts related to the supervision and resolution of Ueno Bank S.A. and the placement of public funds in said entity.”
Prosecutor Gonzalez Vester said Pena would be questioned on Saturday over alleged breach of trust, influence peddling and misappropriation of funds.
Shortly before his removal, Pena called for unity in a post on X.
“Today, we must come together as Paraguayans to rebuild our institutions and restore trust,” he wrote.
The US Embassy in Paraguay expressed solidarity with the country’s people on Friday but made no direct reference to Pena’s removal.
### ‘Pena in prison’
“Pena in prison,” read one of the protest signs displayed outside Congress on Friday.
On Thursday, thousands of people staged protests for the third consecutive night in the capital, Asuncion, and other cities, demanding the return of their savings.
At a demonstration in the capital, Cynthia Farina told AFP that Pena’s actions had affected many families and business owners, including her son, who had savings in Ueno Bank.
“Santiago Pena has hurt so many Paraguayans, so many families, business owners and small business people, including my own son, who had savings in Ueno Bank,” she said.
Police later dispersed the protesters with tear gas and water cannons.
Ueno started as a small financial technology company operating mainly through digital services. It attracted low-income customers before rapidly growing into a major bank.
The institution handled state pension payments and managed accounts belonging to several government agencies.
The crisis has also led to the removal of Central Bank President Carlos Carvallo and Interior Minister Enrique Riera.
Eight Ueno executives have been arrested, while police carried out raids at several locations linked to Grupo Vazquez on Wednesday and Thursday.
The effects of the crisis have also spread to neighbouring Argentina.
About 1,000 employees of ITTI, a technology company that belongs to Grupo Vazquez, were suspended for 30 days without pay.
The country’s football sector has also been affected.
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Ueno Bank sponsors several top-flight football clubs and the Paraguayan national team.
In a statement posted on X, members of the national team said they had also been affected by the crisis.
“We were also victims of this situation,” they said.
