Paraguay’s central bank has placed Ueno Bank into resolution after its solvency ratio fell below half the legal minimum, freezing customer accounts.
The Banco Central del Paraguay (BCP) board voted unanimously on 2 November 2026 to begin the resolution process, after Ueno’s solvency ratio dropped below 50% of the required minimum following adjustments to its financial statements. In March, the bank had reported a total capital ratio of 15.01%, against a required minimum of 12%. Supervisors will appoint officials to assess Ueno’s finances and preserve its assets, and resolution allows deposits to be transferred to other institutions before the remaining assets are liquidated.
Deposit guarantee and public funds
Ueno says it has about 3 million customers, roughly 60% of Paraguay’s adults, who currently cannot withdraw or transfer money. A central bank fund guarantees deposits of up to PYG 228.3 million (USD 38,000) per person, which preliminary estimates suggest will fully cover about 97% of depositors, and must pay out within 15 days, extendable once. Depositors will first receive up to PYG 10 million (USD 1,700), minus any debts owed to Ueno, though no date has been set.
Ueno also holds between USD 800 million and USD 850 million in public money, including around USD 380 million from the state pension and health fund, which says pensions will be paid as usual and plans legal action to recover its investment. The securities regulator has temporarily suspended withdrawals from certain mutual funds linked to Ueno, while the BCP says the situation does not reflect a generalised condition of Paraguay’s financial system.
Warnings, arrests, and political fallout
The central bank says it warned Ueno in June 2026 about excessive lending to companies linked to its owners, and Fitch Ratings revised its outlook on the bank to negative in October 2026. Days before the takeover, Ueno had announced plans to raise USD 100 million in new capital. Prosecutors have ordered the arrest of eight people, including the bank’s president and CEO, in an investigation into suspected breach of trust and other offences.
Central bank governor Carlos Carvallo, a former head of Ueno’s predecessor, has resigned at President Santiago Peña’s request but will oversee the resolution in the interim. Peña was a business partner of Ueno’s owner, Grupo Vázquez, until March 2025, and the regulator has said Carvallo recused himself from decisions involving Ueno. Peña has also agreed with congressional leaders to fast-track legislation speeding up depositor payouts and guaranteeing the return of public money.
