Key facts
- Paraguay's prosecutor's office ordered the arrests of eight people linked to ueno and sought a criminal investigation into the events surrounding the bank.
- Carvallo said he would remain in office during ueno's resolution proceedings, which the central bank said aim to protect depositors and preserve financial stability.
- Ueno has around 3 million customers and administers some $850 million in public funds in Paraguay, according to the report.
- Peña said he reached an agreement with congressional leaders to fast-track a bill allowing the national Guarantee Fund to pay depositors.
- The central bank said the ueno case was isolated and did not point to broader problems in the financial system.
- Grupo Vázquez and ueno did not immediately respond to requests for comment, the report said.
Paraguay's central bank President Carlos Carvallo submitted his resignation on November 3 at the request of President Santiago Peña, as authorities launched resolution proceedings for digital lender ueno. Peña said he asked for the resignation in light of facts that emerged throughout the day. Carvallo said he would remain in office during ueno's resolution proceedings.
The prosecutor's office requested a criminal investigation into the events surrounding ueno and ordered the arrests of eight people linked to the bank. The central bank said the case was isolated and did not point to broader problems in the financial system. Peña said: "This is a particular case of one entity, not of the national financial system." He added that those responsible "must answer before the Judiciary, without exceptions and without privileges."
Ueno, majority-owned by Grupo Vázquez, has around 3 million customers and administers some $850 million in public funds in Paraguay, according to the report. In recent months it faced regulatory scrutiny over alleged excessive lending to companies with ties to Grupo Vázquez, unsettling investors and weighing on both ueno's 2031 dollar bonds and Paraguay's sovereign bonds. Grupo Vázquez and ueno did not immediately respond to requests for comment.
The central bank and Carvallo, who headed the digital bank until August 2023, have faced criticism from lawmakers over how they supervised the lender and over its ties to Peña. Peña was a business partner of the group that owned the bank until March 2025. Concerned customers, including pensioners who receive state benefits through ueno, stood outside closed bank locations on November 3 seeking access to their savings.
Peña announced an agreement with congressional leaders to fast-track a bill authorizing use of the national Guarantee Fund to make payments to depositors. He said the law would also ensure the return of public money and funds held by the IPS social security institute and other public pension funds. The Superintendency of Banks will appoint auditors to verify ueno's asset position, the central bank said. Carvallo told a press conference that stepping aside would help quell the controversy surrounding the central bank and allow it and the banking superintendent's office to work without political and media disputes distracting them.