Paraguay President Impeached and Arrested Following Banking Crisis

COLOMBO (News 1st) - Paraguay's Senate has impeached and removed President Santiago Peña from office, following a major banking crisis that triggered widespread public protests.

Peña was subsequently placed under house arrest after prosecutors issued an arrest warrant against him.

The investigation centres on allegations that he used his political influence to favour Ueno Bank, which collapsed amid financial irregularities.

The bank's suspension left approximately 2.9 million customers unable to access their accounts, sparking public anger across the country.

The allegations include conflicts of interest, influence peddling and the misuse of public funds. 

Peña has denied wrongdoing.

Meanwhile, Vice President Pedro Alliana has been sworn in as Paraguay's new president and pledged to compensate those affected by the banking collapse.

The crisis has also prompted investigations into former Central Bank chief Carlos Carvallo, who is among those facing arrest orders.