Paraguay President Impeached, Placed Under House Arrest After Ueno Bank Collapse

Paraguayan President Santiago Peña has been impeached and placed under house arrest following the collapse of Ueno Bank, one of the country's largest digital banks, triggering a major financial and political crisis.

According to the BBC, almost all senators, including members of Peña's own ruling party, voted in favour of his impeachment on Friday. He was placed under arrest at his residence shortly after the Senate vote.

Peña had business connections with Ueno Bank. On Thursday, he announced his decision to resign, but lawmakers rejected his resignation and proceeded with impeachment proceedings. The move stripped him of the legal immunity he would otherwise have retained as a former president.

Peña previously held shares in a company that owned the bank but sold them last year. He has denied any involvement in alleged irregularities surrounding the bank.

Paraguay's chief prosecutor, Silvia Margarita González, said the former president would be questioned on Saturday over allegations of breach of trust, influence peddling and misuse of public funds.

Following Peña's removal, Vice President Pedro Alliana was sworn in as the country's new president. He has pledged to ensure justice and full compensation for millions of customers affected by the banking collapse.

The crisis erupted after the central bank took control of Ueno Bank following serious financial and regulatory concerns. Since then, customers have been unable to access their savings and make regular transactions through the digital banking platform.

Nearly three million customers have been affected, including people whose savings and pension payments were held by the bank.

The collapse triggered protests in the capital, Asunción, and several other locations on Wednesday and Thursday. Thousands of customers took to the streets demanding the return of their money and accountability from those responsible for the bank's failure.

The crisis has become one of Paraguay's most significant political and financial upheavals in recent years, with investigations underway into the bank's operations and its links to government officials.