Photo: FF MM / Wikimedia Commons (2010 archive)
Paraguay central bank chief Carlos Carvallo submitted his resignation Tuesday after the bank began resolution proceedings for digital lender Ueno, Reuters reported Tuesday morning via Devdiscourse. Carvallo said he would remain in office while the proceedings were carried out.
The central bank said it had detected a shortfall in Ueno’s solvency ratio, a measure of its capital against risk-weighted assets. It said the resolution process was intended to protect depositors and preserve financial stability.
Carvallo and the central bank have faced scrutiny over their supervision of the lender and its political ties, Reuters reported. Carvallo had been Ueno’s president until August 2023.
“Stepping aside will help to quell the controversy surrounding the BCP,” Carvallo told a press conference after the proceedings were announced, according to Reuters. BCP is the Spanish abbreviation for the Central Bank of Paraguay.
He said his resignation would allow the central bank and the banking superintendent’s office to work without distraction from political and media disputes.
Ueno, majority-owned by Grupo Vazquez, has about 3 million customers and administers roughly $850 million in public funds in Paraguay, Reuters reported. The news agency said Grupo Vazquez and Ueno did not immediately respond to its requests for comment.
The central bank described the case as isolated and said it did not point to broader problems in the financial system. Those were the regulator’s assessments. It said the Superintendency of Banks would appoint auditors to verify Ueno’s assets as of the resolution date.
Several lawmakers had called in recent months for the dismissal of the central bank’s senior management after rejecting a report on Ueno that they considered incomplete, Reuters reported.
Archive photograph of the Central Bank of Paraguay, not Tuesday’s announcement. FF MM / Wikimedia Commons, CC BY-SA 3.0; displayed at reduced resolution without further edits.
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