Paraguay's Senate removes President Peña over Ueno bank collapse; Alliana sworn in
Paraguay's Senate removed President Santiago Peña over the collapse of Ueno Bank, and Vice President Pedro Alliana took office as the new head of state. Prosecutors ordered house arrest for Peña.
Pedro Alliana, 52, was sworn in on Friday as the 53rd president of Paraguay, a South American country, after the Senate removed his predecessor Santiago Peña amid a banking scandal. The collapse of Ueno Bank has triggered a financial and political crisis in the country.
How the removal unfolded
Forty-four of the 45 senators voted to remove Peña, with one abstaining. On Thursday the Chamber of Deputies had voted 78 to zero to impeach him. Before that, Congress rejected Peña's offer to resign. Had it been accepted, he would have kept the right of former presidents to join the Senate, with legal protection from prosecution.
Peña's Colorado Party, which has largely dominated Paraguayan politics since 1948, backed the impeachment. Party leader and former president Horacio Cartes said it was meant to restore the country's institutions. Peña did not attend the hearing, sending lawyers instead, and had asked for more time to prepare his defence.
After the vote, prosecutors ordered house arrest for Peña on suspicion of breach of trust and other crimes. A warrant was also issued for Carlos Carvallo, the former head of the central bank, who resigned this week. The bank has been accused of failing in its oversight duties.
The Ueno collapse
The crisis began on Tuesday, when the central bank said Ueno had fallen below legal solvency standards and took control of the lender. Millions of clients lost access to accounts and pension payments. The bank had about three million members, nearly two-thirds of Paraguay's adults, and was the country's fifth-largest by deposits.
Prosecutors are examining whether Ueno was shielded from accountability because of government connections; $355m in state pension funds were invested in it. At least 27 people face criminal charges, including lead shareholder Miguel Vazquez. Peña was identified in 2023 as a shareholder of Ueno's parent company, but says he sold his shares in early 2025.
Alliana served as vice president from the start of Peña's term in 2023. He previously governed the Ñeembucú department and spent nearly a decade in the Chamber of Deputies, three years of it as president.
