Paraguay ueno bank resolution and depositor-loss risk

Paraguay is resolving ueno bank after insolvency findings froze accounts, disrupted payments and escalated into a presidential resignation.

Banco Central de Paraguay seized ueno bank on Nov 3 after finding irregularities and a solvency ratio below half the required minimum. The intervention froze accounts, app access, ATMs and card payments for roughly 3 million customers. President Santiago Peña resigned on Nov 5 after protests and near-certain impeachment pressure tied to his former links to ueno’s parent.

The resolution affects depositors, Paraguay’s regulator, mutual funds, state entities, retailers, payment users, political leaders and stability.

• Ueno held about $2.8 billion to $3 billion in deposits. • The bank served about 3 million customers. • Depositors above $35,000 may face losses, according to supplied reporting. • Thirteen mutual funds across five firms froze withdrawals. • Critics allege parent Grupo Vázquez was operated as a Ponzi scheme.