Paraguay bank freeze leaves 2.9 million without savings access

Ueno Bank freeze cuts off half of Paraguay from savings

Virtual bank Ueno Bank, serving one in three Paraguayans, displayed a message on thousands of screens: "We cannot show your balance. Try again later." Behind this was a Central Bank intervention, collapsed solvency ratios, and **€2.5 billion** trapped. The country's biggest recent financial crisis left **2.94 million people**, or 48.2% of the population, without access to their money.

Deisy Asva, a 20-year-old nursing student, tried to withdraw her savings Tuesday morning only to see a blank screen. In Asunción, customers crowded closed branches; in Ciudad del Este, hundreds surrounded an office. National Police activated maximum alert status and deployed agents at banking delegations nationwide.

From 5.5% solvency to corralito in fifteen days

The bank itself detected its solvency index had fallen below 50% of the minimum requirement, "as a result of adjustments made to its financial statements during the regularization process." Opposition figures cite a collapse to **5.5%**. The cause: irregular loans to the entity's own owners.

The immediate consequence is a blockage lasting at least fifteen days, affecting more than individuals. The **IPS** (Instituto de Previsión Social), which manages pensions for most Paraguayan workers, has about **$355 million** in Ueno, representing 9% of state investments, according to financial manager Gladys Vera. The bank also channeled investments for several public institutions.

"With so much technology available today, how can this take 15 days?" asked a client already anticipating borrowing from family. María Elena González, a 41-year-old administrator, called her husband as soon as she heard to stop tenants from depositing rent into the account.

Impeachment trial against Santiago Peña and public contracts

The fallout dragged President **Santiago Peña**, a former shareholder of the involved entity, into controversy. Opposition revealed links between Peña and Ueno Bank president **Juan Manuel Gustale**, arrested after the scandal, along with multi-million dollar public contracts allegedly won by the entity during his term. Gustale maintains Peña has no relation to the group beyond shares in Ueno Holding sold last year.

The Colorado Party has called for supporting the impeachment trial: "We will not stand by the plundering of public, private, and pensioners' funds," stated a party voice. The opposition speaks directly of "looting retirees' money."

Chilean AFPs under scrutiny for Paraguay exposure

The impact extends beyond borders. Chilean senators from Frente Amplio, Communist Party, Christian Democracy, and independents signed a document clarifying Chilean pension fund investments in Paraguay. Concern centers on AFP exposure to a financial system under intervention that could compromise retirement savings for millions of workers.

The case raises uncomfortable questions about supervision: a bank serving nearly half the country reached the brink of insolvency due to loans to its own owners. After fifteen days of blockage, half of Paraguay still waits for its balance.