Paraguay President Santiago Peña has announced his resignation after the collapse of a major bank with close links to his administration.

The banking scandal had left half of the country’s population of six million unable to access their money.

In a video statement released online yesterday, Peña, a conservative economist, stated that he was stepping down from his post to ensure stability.

Calling the decision “one of the most difficult moments of his life”, Peña said: “I apologise to the public if I have disappointed you. It was never my intention to betray the trust you placed in me.”

Peña was facing an impeachment vote in the lower house of Congress in connection with the bank’s collapse, which lawmakers characterised as “systematic dereliction of duty”.

Minutes after his announcement, lawmakers voted unanimously to proceed with the impeachment process.

Earlier on Thursday, the prosecutor general’s office announced that it was evaluating a formal criminal complaint filed against the president by lawmakers.

Elected in 2023, the 47-year-old Peña was a staunch South American ally of the Trump administration.

Ueno Bank, which sits at the centre of the scandal, was taken over by the Central Bank of Paraguay early on Tuesday after regulators determined that the lender was no longer solvent.

Millions of Paraguayans soon realized that they could no longer withdraw cash, make digital payments, or use their debit cards for grocery shopping.

“When I woke up on Tuesday, I was completely helpless, without a single peso in my pocket,” said Benicia Sosa, 56, who joined a protest outside the Congress building on Wednesday night.

A day labourer from Luque, on the outskirts of the capital Asunción, Sosa said that her husband and eight children were all locked out of their Ueno accounts.

Sosa said she had been drawn by Ueno’s promotional offer, which provided cardholders with up to 40% cashback at supermarkets.

Sosa also noted that she regretted voting for Peña, who had pledged to revive the economy and create half a million jobs.

“I was foolish. The economy is going to hell,” the worker said during the demonstration at the presidential palace.

Over a few decades, Ueno evolved from a loan-sharking business operating out of a dilapidated market in Asunción into a youth-oriented banking app and a major financial player at times compared to Revolut or Nubank.

However, sceptics have long argued that this rags-to-riches rise was achieved through public resources and high-level connections.

When Peña assumed office in August 2023, he appointed Ueno’s former chairman, Carlos Carvallo, as head of the Central Bank.

Months later, the Central Bank officially granted Ueno a licence to operate as a brick-and-mortar bank. Carvallo also stepped down on Tuesday.

As of the end of October, Ueno, which is not capitalised in company filings and roughly translates to “good”, announced that it had approximately 2.9 million customers.

It also held more than $800 million in public funds, which included around 10% of the state pension fund.

Ueno sponsored the Paraguay national football team, alongside dozens of other businesses and brands.

Its sister company, Itti, expanded by securing dozens of public procurement contracts involving citizens’ data.

Last year, Peña announced that he had officially divested from another affiliated entity, Ueno Holding, following criticism that his shares gave rise to a conflict of interest. Peña maintained that nothing illegal had occurred.

Even so, analysts pointed out that the bank’s proximity to power aroused regulatory suspicions and attracted hostility from rivals.

Concerns surfaced in September when lawmakers loyal to Horacio Cartes, a powerful former president, demanded that the Central Bank answer questions regarding Ueno.

Cartes also leads the Colorado Party, which has governed Paraguay for almost all of the past 80 years.

Peña previously served as finance minister under Cartes, a tobacco magnate sanctioned by the Biden administration over corruption allegations.

According to Paraguayan-American political scientist Miguel Carter, however, the two men fell out over who would lead the party into the 2028 elections.

Reports emerging in October indicated that Ueno had extended roughly $150 million in loans to small firms connected to its own executives and employees.

This situation risked breaching banking regulations and endangering its balance sheet.

Worried about solvency, foreign investors began offloading Ueno’s bonds.

This month, Ueno offered additional perks to savers holding cash in their accounts.

Last week, the company announced that it had raised $100 million from investors and its Luxembourg-registered holding company, denying reports of an imminent intervention.

The speed of Ueno’s collapse surprised even its critics, evoking memories of the 1995 crisis that wiped out half of Paraguay’s banks.

Speaking at a press conference, Central Bank Governor Carvallo, who resigned on Tuesday, stated that the broader financial system was secure and that Ueno customers would be able to recover their funds “as soon as possible”, up to a limit of approximately $38,000.

Analysts observed that this threshold also applies to businesses, meaning that companies holding substantial cash deposits in the bank could also face bankruptcy.

Next in line to succeed Peña is Vice-President Pedro Alliana, who is likewise a member of the Colorado Party.

Yet some lawmakers argued that Peña should not be permitted to leave the presidency so easily.

Under the constitution, should his resignation be accepted, Peña would become an honorary senator entitled to parliamentary immunity. That status would shield him from investigations.

Local media reports suggested that Peña might be considering fleeing the country with US assistance, emulating the escape of Flávio Bolsonaro, the candidate who lost Brazil’s presidential election last month.

Last night, the presidential office dismissed the circulating “rumours” without going into detail. The US Embassy in Asunción referred inquiries to the State Department.

An impeachment resolution drafted in the US House of Representatives against Secretary of War Pete Hegseth could be approved next week, according to claims reported by Fox News.

Citing several Republican lawmakers, the television network reported that the resolution is planned to be brought to a vote once Congress resumes its work.

Republican Representative Thomas Massie told the network that he intends to call a vote on the impeachment resolution when Congress reconvenes, unless Hegseth resigns beforehand.

Speaking to Fox News regarding the measure prepared by Massie, one Republican lawmaker said, “If he introduces the bill, it passes.”

Two other Republican lawmakers interviewed by the network shared the same view.

Massie aims to utilize a procedural rule that allows a resolution to be brought to the floor despite the wishes of the majority leadership.

Under this procedure, once the resolution is introduced, the House of Representatives must hold a vote within two legislative days.

Lawmakers can also vote to end debate on the measure or refer the text to the relevant committee before proceeding to a direct impeachment vote.

An official speaking to the network noted that voter turnout on the House floor could determine the outcome of the vote.

It is reported that some Republican lawmakers who lost their elections might not return to the House before the end of the year.

Because the party holds a very narrow majority in the House of Representatives, if Democrats vote unanimously in favor of the resolution, the absence of just a few lawmakers could be enough for the measure to pass.

Fox News reported that the majority of Republicans still oppose impeaching Hegseth.

One lawmaker, meanwhile, expressed doubts regarding the likelihood of the effort succeeding.

Even if the House of Representatives approves the impeachment resolution, the decision does not result in the immediate removal of the Secretary from office.

Following the impeachment proceedings, the matter must move to the Senate to be taken up there.

A report by CNN yesterday also detailed Massie’s plan to initiate an impeachment vote against Hegseth.

According to sources who spoke to the network, a segment of Republicans holds the Secretary of War responsible for the party’s defeat in the midterm elections on November 3.

Some figures within the party accused Hegseth of convincing President Donald Trump to launch a military operation against Iran without taking into account how the process would conclude or its political fallout.

In a statement on November 4, Trump stated that he would not dismiss Hegseth.

Trump maintained that the Secretary of War was doing a “great job.”

Department of War Spokesperson Sean Parnell rejected claims that the Secretary might resign, speaking to Fox News.

Parnell noted that Hegseth has no intention of backing down before politicians seeking to score internal party points or launch baseless investigations.

US Secretary of State Marco Rubio has announced new sanctions against Cuba, with Chinese suppliers working with the Cuban military among those added to the blacklist.

In a statement, Rubio said: “Cuba’s ruling elites are monopolizing the island’s energy, maritime shipping, and tech resources for their own enrichment, while everyday Cubans are left to deal with power outages, shortages, and a stagnant economy.”

Arguing that the “Marxist regime” in Havana relies on a network of state-owned enterprises, joint ventures, and offshore intermediaries to sustain the system, the US secretary of state said: “The regime’s foreign enablers provide military equipment that sustains the regime’s military forces and enables brutal repression, while also backing its persistent efforts to threaten, infiltrate, and subvert the US homeland.”

Rubio announced that the new sanctions are being implemented pursuant to President Donald Trump’s Executive Order 14404, entitled “Imposing Sanctions on Persons Responsible for Repression in Cuba and Threats to US National Security and Foreign Policy.”

The new sanctions designate ten targets, including additional “Cuban elites”, a crude oil shipping network, state-owned import and technical support entities, and China-based suppliers servicing Cuba’s military forces.

In addition, Rubio identified five associated vessels as “blocked property”.

Rubio continued:

“Today’s targets include GUILLERMO FAUSTINO RODRIGUEZ LOPEZ CALLEJA, who is part of an extensive offshore network of maritime shipping companies that moves Cuban crude oil shipments to and from the island. I am also sanctioning ANY RODRIGUEZ LASTRES, the daughter of previously sanctioned Grupo de Administración Empresarial (GAESA) President Ania Guillermina Lastres Morera.”

Additionally, the US Department of the Treasury issued a determination under Executive Order 14404 authorizing the imposition of economic sanctions against any foreign person determined to operate, or to have operated, in the electronics, manufacturing, maritime, and technology sectors of the Cuban economy.

According to Rubio, while the Cuban leadership “channels the island’s resources to its military elite”, while “regime insiders and family members benefit from opaque offshore networks”, and while “Cuba continues to serve as a base for a global coalition of hostile, anti-American actors to convene, threaten, spy, and conspire against the US and its interests”, the Trump Administration will not stand by.