Paraguay Takes Over Ueno Bank, a Digital Lender With 3 Million Customers
Hey Digital Banking Fanatic!
What happens when regulators take over a digital bank used by most of a country's adults?
Paraguay is about to find out. Its central bank has put Ueno Bank into resolution after the lender's solvency ratio fell below half the legal minimum.
Ueno says it has about 3 million customers, roughly 60% of Paraguay's adult population. On Tuesday, customers said they were locked out of their accounts on the bank's app.
Deposits are guaranteed up to 228 million guaraní, or about $38,000. The central bank's preliminary estimate is that around 97% of depositors are fully covered. Above that limit, it hasn't promised full repayment.
Then there's the politics. President Santiago Peña remained a business partner of Grupo Vázquez, the group that owns Ueno, until March 2025. The bank says he was never a shareholder or investor.
The central bank's own president, Carlos Carvallo, ran Ueno before Peña appointed him. He says he has signed his resignation letter but will stay on to oversee the takeover.
This shows how quickly a digital bank can become part of a country's financial plumbing. Ueno also handles $800-850 million in public money, according to the bank.
Of course, the investigation is only starting. The central bank says it found "more serious irregularities" and plans to report them to the authorities.
Here's what else is happening in digital banking today👇
See you tomorrow!
Cheers,
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