Paraguay Swears In Vice President After Senate Votes To Oust President

Pedro Alliana, 52, took the oath of office on Friday to become Paraguay’s 53rd president. He assumes the role following the removal of his predecessor, Santiago Pena, in a move driven by a banking scandal that has left millions of customers without access to their funds.

The political shift came quickly. In the early hours of Tuesday, the central bank announced that Ueno, the country’s fifth-largest bank by deposits, had fallen below legal solvency standards. The institution did not have enough collateral to cover its loans. Regulators seized the lender and transferred its remaining assets to other banks to protect the system.

Ueno had grown rapidly in recent years, consolidating under its brand in 2023 with $800m in public money. It claimed that more than one million Paraguayans opened their first bank account with the firm. By the time of its collapse, the bank counted nearly two-thirds of the country’s adults as customers, a group totaling roughly three million people.

The sudden seizure left these clients without access to their accounts and pension payments. Questions soon arose about whether government institutions properly regulated the bank and whether Pena had conflicts of interest. In 2023, Pena was identified as a shareholder of Ueno’s parent company, though he stated he sold his shares in early 2025.

Pena initially offered to resign to preserve democratic institutions. However, Congress rejected his resignation on Thursday and moved forward with impeachment instead. The Chamber of Deputies voted 78 to zero to impeach Pena, clearing the way for a Senate vote.

The Senate voted on Friday to remove Pena from office. Forty-four senators voted in favor, while one abstained. This outcome meant Pena would not retain the legal protections from prosecution that former presidents typically enjoy as senators. Prosecutors ordered him placed under house arrest on suspicion of breach of trust and other crimes.

An arrest warrant was also issued for Carlos Carvallo, the former head of the central bank. Carvallo resigned earlier this week after the central bank was accused of failing in its oversight duties. At least 27 people are now facing criminal charges, including lead shareholder Miguel Vazquez. The charges include attempted fraud, misappropriation of funds, and influence peddling.

Alliana, who served as vice president under Pena since 2023, begins his term with prosecutors questioning if Ueno was shielded from accountability due to its government ties. State pension funds had invested $355m in the bank. Pena, who did not attend the final Senate hearings in person, said he plans to cooperate with the investigation while placing the country above his personal fate.