Paraguay takes over Ueno Bank as depositors await payouts
Paraguay’s central bank took control of Ueno Bank after its solvency ratio breached the legal threshold. Customers lost access to withdrawals and transfers, while officials prepared deposit-insurance payments. The bank says it has about three million customers. The intervention also prompted President Santiago Peña to request the central bank governor’s resignation.
Economics & Markets··Morning
Depositors lose access after the takeover
Paraguay’s central bank took control of Ueno Bank, a digital lender, on 3 November following a solvency crisis. President Santiago Peña asked central bank governor Carlos Carvallo to resign after the intervention. Carvallo submitted his resignation but temporarily remained to oversee the resolution.[1], [2]
The central bank’s board had voted unanimously late on Monday after Ueno’s capital relative to risk-weighted assets fell below half the legal minimum. Customers could neither withdraw nor transfer money on Tuesday. Ueno says it has about three million customers, roughly 60 per cent of Paraguay’s adult population.[1]
Deposit insurance could cover most customers
Deposit insurance guarantees up to 228.3 million guaranies, approximately 38,000 dollars, per person. Preliminary central bank calculations put full coverage at about 97 per cent of depositors. The law allows 15 days for payment and a single extension. An initial payment of up to 10 million guaranies, less debts owed to Ueno, was planned without a starting date.[1]
Public funds and a failed capital plan precede the intervention
Ueno held about 800–850 million dollars in public money, including around 380 million dollars from Paraguay’s pension and health fund. The fund said it was moving 32,000 pensioners to other banks and that pensions would continue to be paid.[1]
The central bank said it warned Ueno in June about lending to companies linked to its owners. A plan announced the previous week had sought 100 million dollars of fresh capital, half from the holding company and half from shares sold to local private investors.[1]
