Pedro Alliana has been sworn in as Paraguay’s new president, following the impeachment of Santiago Pena amid a banking scandal. Alliana, 52, took the oath of office on Friday and became the 53rd president of the South American country.
Alliana had been Pena’s vice president since Pena began his term in 2023. His elevation came on the same day Pena was removed from office by the Senate, ending his presidency abruptly.
Senate removes Santiago Pena from office
Forty-four of the 45 senators voted to remove Pena, while one senator abstained. Pena, a member of the Colorado Party, which has long governed Paraguay, announced his departure on social media that afternoon. He thanked people for their support and acknowledged the distress of those still waiting for answers.
Also read: Paraguay's President Santiago Peña resigns after bank collapse
Pena’s fall came quickly. Earlier in the week, the sudden collapse of the lender Ueno Bank had raised questions about whether government regulators had properly supervised it. There were also questions about whether Pena had conflicts of interest linked to the bank.
Pena had offered to step down after the collapse, citing the need to protect the country’s democratic institutions. On Thursday, however, Congress rejected the resignation and moved ahead with impeachment instead. The Colorado Party backed the move, and its former president and party leader, Horacio Cartes, said in a statement that the party supported the impeachment to restore the institutions of the republic.
Had Pena been allowed to resign, he would have kept the right that former presidents hold to sit in the Senate, along with legal protection from prosecution. In Thursday’s session, the Chamber of Deputies voted 78 to zero to impeach him, which paved the way for the Senate vote the following day.
Ueno Bank collapse and oversight questions
The crisis began early on Tuesday, when the central bank said Ueno had fallen below the legal solvency requirements, meaning it lacked enough collateral to cover its loans and other investments. The authorities seized the lender and moved its remaining assets to other banks as a safeguard. Millions of Ueno customers, however, suddenly lost access to their accounts and pension payments.
The bank had about 3 million members, meaning nearly two-thirds of Paraguay’s adults were among its customers. It had grown rapidly, consolidating in 2023 under the Ueno brand, and became the country’s fifth-largest bank by deposits. According to the company, more than a million Paraguayans had opened their first bank account with it. Public money of $800m had fuelled its growth, and roughly $355m in state pension funds had been invested in the bank.
Pena was identified in 2023 as a shareholder in Ueno’s parent company. He said he had sold his shares in early 2025. Prosecutors have also asked whether the bank was shielded from accountability because of its government connections, while the central bank, which has been accused of failing in its oversight duties, has come under scrutiny. Its former head, Carlos Carvallo, resigned earlier this week, and an arrest warrant has been issued for him.
After the impeachment, prosecutors said they would seek Pena’s arrest on suspicion of breaching public trust and other offences. He was reportedly detained at his home. At least 27 people now face criminal charges linked to the scandal, including lead shareholder Miguel Vazquez. The investigation covers attempted fraud, breach of trust, misappropriation of funds and influence peddling.
Alliana’s career and the challenges ahead
Alliana began his political career as governor of his home department of Neembucu, in the south of Paraguay. He later spent nearly a decade in the Chamber of Deputies, including three years as its president. He now takes over a country facing one of its most serious political and economic scandals in recent history.
The Chamber of Deputies declined to open impeachment proceedings against Alliana. Pena has signalled that he intends to cooperate with the investigation, but he did not attend the impeachment hearings in person on Friday and sent his lawyers instead. In a statement, he said he did not want his presence to deepen division or instability, and that he saw it as his duty to put the country above his personal fate.
Earlier on Friday, Pena had complained about the speed of the Senate process and asked for more time to exercise his constitutional right to a defence, saying the time allotted was clearly insufficient.
