In brief
Paraguay’s central bank president Carlos Carvallo resigned on Tuesday after President Santiago Peña requested it, as authorities launch resolution proceedings for the digital lender Ueno. The move follows criminal investigations into irregular lending and the bank’s ties to the president, sparking worry among depositors and shaking Paraguay’s image as a safe spot for foreign investors.
On November 3, Paraguay’s central bank chief Carlos Carvallo stepped down after President Santiago Peña asked for his resignation. The decision came while prosecutors began a resolution proceeding against the digital lender Ueno, a bank linked to the president’s former business partner.
President Peña said he had requested Carvallo’s resignation “in light of facts that emerged throughout the day.” The move comes after a prosecutor’s office demanded a criminal investigation into the events surrounding Ueno and ordered the arrest of eight people linked to the lender.
Ueno, which is majority owned by Grupo Vázquez, has about 3 million customers and manages roughly $850 million in public funds. Critics say the central bank failed to supervise the lender properly and that its ties to Peña create a conflict of interest. Lawyers argued that the bank’s expansion from a niche fintech fast into a mid‑tier bank highlighted regulatory gaps.
Customers, including pensioners who receive state benefits through Ueno, were seen outside closed bank locations calling for access to their savings. “We’re demanding access to money we have here at Ueno bank,” said Manuel Cáceres of Ñemby, a suburb of Asunción. “Unfortunately, a lot of people, myself included, are spending the morning like this.”
Carvallo told reporters that his resignation would help the central bank and the banking superintendent’s office carry out their work without political and media distractions. He added that staying on would allow the bank to focus on the resolution’s goal of protecting depositors and keeping financial stability.
President Peña also announced an agreement with congressional leaders to fast‑track a bill that would use the national Guarantee Fund to pay depositors and secure public money, including funds held by the IPS social security institute.
The crisis threatens Paraguay’s reputation as an attractive destination for foreign capital. Much of the country’s investment flows come from neighbors like Brazil, and the turbulence could deter future investors while shaking confidence in the financial system.
