Paraguay's Senate opened an extraordinary sitting on Friday as the impeachment trial of President Santiago Peña got under way, a day after his resignation over the collapse of digital bank ueno left the country's leadership in limbo, Reuters reported from Asuncion.
Peña's legal team had asked the Senate for a 72-hour extension to prepare his defence. The Senate rejected the request, and the president was to be notified that he had been summoned to appear before the Senate on Friday, Reuters said. Senate President Basilio Núñez confirmed the trial would proceed immediately, according to News Central TV's report of the decision.
This is the next step in the crisis Awaaz Punjab reported on Thursday, when Peña announced his resignation but a joint session of Congress failed to accept it for lack of a quorum, sending him to a Senate trial instead. Read the earlier story: resignation blocked, Senate trial ordered
The charges
Lawmakers acting as prosecutors formally filed the impeachment charges on Thursday evening. The charges allege that Peña committed conflicts of interest, manipulated regulatory oversight, diverted pension funds and participated in an institutional cover-up involving the central bank, Reuters reported. Opposition legislators have argued that any final vote must respect the president's right to a defence before proceedings move forward. Peña, 47, has said he will appear and defend himself with arguments and evidence. Removal requires the votes of 30 of the Senate's 45 members.
Frozen savings, protests — and the first payouts
The crisis has spilled onto the streets, with demonstrators returning to downtown Asuncion on Thursday night demanding accountability for ueno's collapse and faster compensation for depositors whose savings remain frozen, Reuters reported. Some account holders began recovering their money on Thursday night, and EFE reported that the central bank began paying deposit guarantees on Friday to an initial group of customers, up to a maximum of 10 million guaraníes (about $1,565). Ueno held roughly $800 million in public deposits — yaani about $80 crore — as of last month, according to earlier reporting on the collapse.
Vice President Pedro Alliana, who is set to take the top office in Peña's place, had not yet been sworn in by early Friday, leaving Paraguay formally without a settled leadership while the trial runs. An impeachment conviction would also prevent Peña from becoming a senator for life, stripping him of parliamentary immunity and potentially exposing him to criminal investigations; prosecutors have already opened criminal cases against him in connection with ueno, and the attorney general's office has announced three criminal investigations into the crisis, the Associated Press reported.
Investors and neighbouring Brazil, Paraguay's largest economic partner, are watching closely. Regulators have sought to reassure markets by guaranteeing most deposits and containing risks to the wider financial system, Reuters said. "Protests over frozen savings will intensify if Peña's exit appears to grant him impunity or if payouts to depositors and pensioners stall," Mariano Machado, Americas principal analyst at Verisk Maplecroft, told Reuters. A Brazilian government source told the agency that Brazil's immediate concern was avoiding social instability in Paraguay.
The turmoil began earlier this week after Paraguay's central bank intervened in ueno, saying the fast-growing digital bank had breached minimum solvency requirements. The fallout has already forced out the central bank chief and led to arrest warrants for eight ueno executives; officials said the bank's top executives were transferred on Friday to one of Paraguay's main prisons for detainees awaiting trial. What happens next is the Senate trial itself: Peña's defence, the evidence sessions and a recorded vote that will decide whether he is removed — and whether Alliana finally takes office until the term ends in August 2028.
Source: Reuters