The Ueno Bank crisis in Paraguay erupted between November 2 and 3, 2026, when the Central Bank of Paraguay placed the digital lender into resolution because of a severe capital shortfall.
Within hours, the bank’s app, cards, transfers, withdrawals and branches stopped operating. Nearly 2.94 million customers lost immediate access to money held at Ueno, triggering long queues, protests and growing political pressure.
From Digital Success to Financial Collapse
Ueno Bank emerged from the restructuring of older Paraguayan financial businesses, including Financiera El Comercio and CrediCentro. After receiving a banking licence in November 2023, it expanded rapidly through digital accounts, cashback offers, fintech services and major acquisitions, including Visión Banco.
The bank also built a highly visible brand through sponsorships involving Paraguayan football, the national team, the CONMEBOL Sudamericana, Olympic sports and the Rally of Paraguay.
By September 2026, Ueno reportedly held around $2.84 billion in deposits and had an outstanding loan portfolio of approximately $2.56 billion.
Solvency Falls to 5.56%
The Central Bank’s inspections reportedly uncovered weaknesses in credit-risk assessments, insufficient provisions and loans involving companies connected to Ueno’s shareholders or executives.
The regulator imposed adjustments exceeding 1.62 trillion guaraníes, which pushed Ueno’s solvency ratio down to 5.56%, compared with a reported regulatory minimum of 12%.
The bank was also unable to restore a mandatory reserve of $70 million. A proposed $100 million capital increase was not completed before the Central Bank intervened.
Public Money and Pensions at Risk
Ueno managed or held between $800 million and $855 million in public funds. These included investments belonging to the Social Security Institute, or IPS, estimated at between $355 million and $380 million.
Around 32,000 pensioners received their benefits through Ueno. The IPS said pensions and additional year-end payments would continue and began preparing to move beneficiaries to another bank.
The crisis also disrupted commerce. According to a Paraguayan trade association, two out of every three electronic transactions in major retail chains passed through Ueno accounts, raising fears of a partial paralysis of domestic trade.
Arrest Warrants and Asset Seizures
Prosecutors issued arrest warrants for eight senior Ueno figures. The investigation focuses on the management of the bank’s resources, its lending practices and possible transactions involving companies linked to its owners.
Authorities also ordered the preventive seizure of assets and accounts connected to Ueno’s controlling companies and executives. The measure was valued at approximately $329 million.
The bank’s ownership chain has been described as running from Grupo Vázquez SAE through U Holdings SARL and U Paraguay SA to Ueno Bank.
Santiago Peña Resigns
The crisis quickly reached the country’s political leadership. Central Bank president Carlos Carvallo, who had previously led Financiera Ueno, resigned at President Santiago Peña’s request.
Peña had previously owned shares in the holding company connected to Ueno. Opposition lawmakers and dissidents from his Colorado Party accused him of misconduct and conflict of interest.
On November 5, while the Chamber of Deputies was debating impeachment charges, Peña announced his resignation. He said the decision was intended to protect Paraguay’s stability, social peace and democratic institutions.
The Chamber subsequently approved the impeachment accusation with 78 votes, far above the 53 required. The Colorado Party supported the case against Peña but not against Vice-President Pedro Alliana.
Alliana is expected to complete the presidential term through August 2028, although the formal transfer of power and the possible continuation of impeachment proceedings still require clarification.
A Crisis That Is Not Over
Peña’s resignation has not resolved the central questions surrounding Ueno Bank. Paraguay must still determine how much money can be recovered, which loans caused the collapse, whether public funds exceeded legal concentration limits and who should bear any remaining losses.
The Ueno case began as a banking solvency crisis. Within days, it became a national crisis involving savings, pensions, public money, financial supervision and political power.