Paraguay shuts Ueno Bank, locking customers out of deposits

A predawn intervention and a jarring login screen

When 20-year-old nursing student Deisy Asva checked her Ueno app Tuesday morning, the only message was: "We cannot display your balance. Please try again later." Living in San Lorenzo near Asuncion, she used the account for transit recharges, snacks at university and day to day bills, with fees due Saturday. "With so much technology available nowadays, how can this take 15 days?" she said. "I'm going to have to borrow money from my family."

A bit after 3 a.m., the central bank announced the shutdown; a few hours later it followed up, saying Ueno would be moved into resolution. Regulators concluded that, once its financial statements were revised, Ueno's solvency ratio fell under the mandated 50% threshold.

How deeply Ueno was woven into daily money flows

By June, Ueno reported serving upwards of 2.9 million customers across a nation of about 6.1 million residents, processing in excess of 3 million transactions per day. More than 32,000 retirees used the bank to receive IPS social security pensions, and a business administrator, María Elena González, noted IPS had about $300 million on deposit at Ueno.

That footprint showed up on the streets. Customers queued at shuttered branches in Asuncion, and hundreds gathered at a site in Ciudad del Este, as grievances from people cut off from their money surged across social platforms. The National Police declared a full security alert and sent officers to Ueno locations.

Regulators emphasized the issue was confined to Ueno and said the broader system remains sound. About 97% of Ueno depositors hold balances within the state guarantee, which covers up to 228 million guaranies per depositor and must be paid out within 15 days.

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Legal moves, tense scenes and political ties

Following the shutdown, the public prosecutor's office began a probe and obtained arrest orders for at least eight individuals connected to Ueno; among them was Miguel Vázquez, who chairs the bank's controlling shareholder, Grupo Vázquez. Santiago Peña, now President, had invested in Ueno's holding company earlier and divested his stake in March 2025.

Tensions flared too. In Nemby, a 45-year-old customer smashed a branch's glass door while seeking information about his savings, injuring his leg before receiving medical attention and being summoned by prosecutors, according to local newspaper Última Hora. Business groups warned of broader fallout: Paraguay's association of importers and retailers said commerce risked "semi-paralysis," estimating that about two thirds of electronic payments at large retail stores flowed through Ueno accounts.

The investor angle

Hours before regulators intervened, Ueno was still wooing deposits. Late Monday night, accountant Rocío Zárate moved 1 million guaranies into her account, drawn by a promotion offering a 50% rebate on a credit card purchase if fresh funds stayed until Nov. 7. She also held an additional 2 million guaranies at the bank.

Zárate said her uncle alerted her that the bank had been intervened. "It was very shocking. It completely caught me by surprise."

Even if most balances are insured, the practical issue is timing. Cash flow can get tight if deposits are frozen for days or weeks. González, who used Ueno to collect rent with her husband, told tenants to stop sending payments to the account.

With 18 years of contributions to IPS and another decade ahead, she is focused on whether a fund with about $300 million parked at Ueno will be ready when she retires. "I don't know what this fund will look like in 10 years," she said.

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