Paraguayan President Santiago Peña resigned on Thursday amid a major political and financial crisis triggered by the collapse of digital lender Ueno. The bank's failure froze access to millions of accounts and shook investor confidence in one of South America's most stable economies.

Peña stepped down hours before lawmakers prepared to advance impeachment proceedings. He had also lost support within his own conservative Colorado Party.

In a statement on social media, Peña said he would appear before the Senate impeachment proceedings to "exercise my right to a defence."

He added that he would do so "not out of personal ⁠pride, but because being accountable and providing explanations is also a responsibility I owe to the Paraguayan people."

He also called for a quick solution for customers unable to access their accounts. "Clarifying the facts and resolving the payments are obligations that must ​advance at the same time," he said.

Following his resignation, Paraguay's sovereign bond prices fell. The guarani weakened beyond 6,500 against the US dollar before closing at 6,490, marking a nearly 5% decline during the day.

The crisis began earlier this week when Paraguay's central bank intervened in Ueno after finding that the fast-growing digital lender had failed to meet minimum solvency requirements. The fallout forced the central bank chief to resign and led to arrest warrants for eight Ueno executives, who later surrendered.

Ueno grew from a small fintech company into a mid-sized bank with around 3 million customers in a country of 6.5 million. It also managed nearly $850 million in public funds, including money linked to government institutions and pension schemes.

Opposition lawmakers accused Peña of conflicts of interest, misuse of pension funds and protecting the bank from scrutiny. Peña denied any wrongdoing, calling the matter a regulatory issue that should be handled by the courts.

Elected in 2023, Peña faced growing scrutiny over his past links to Grupo Vazquez, the business group that owned Ueno until March 2025. He said he sold his stake in the group that month and had no improper involvement in the bank's operations.

Ueno customer Felipe Rodriguez criticised the president over the crisis. "Peña is playing with savers' money," he said, choking up. "This cannot go unpunished," he added, while also accusing Vice President Pedro Alliana of involvement.

Alliana, who is next in line for the presidency, has distanced himself from Peña in recent days. He also announced that he would put his own presidential ambitions on hold until the financial crisis is resolved.