Paraguayan prosecutors have charged former president Santiago Peña and a judge has ordered him into pre-trial detention, a day after the Senate removed him from office over the collapse of Ueno Bank.

Peña was brought before prosecutors in Asunción on Saturday and charged with breach of trust and mismanagement for personal gain. After a hearing, Judge Hernán Otazu told reporters he had ordered the former president taken into pre-trial custody and held at the same Asunción facility where he was taken after his removal from office on Friday.

Peña, 47, was questioned for about three hours about his links to Ueno Bank and declined to make a statement during the hearing, according to the judge. Prosecutors also asked for his assets to be frozen, along with those of former central bank president Carlos Carvallo, who faces the same charges.

The Senate voted 44-0 on Friday to remove Peña from office, making him only the second Paraguayan president to lose office through impeachment since the return of democracy, after Fernando Lugo in 2012. Peña had offered to resign on Thursday, but lawmakers chose to impeach him instead, a decision that stripped him of the immunity he would have enjoyed as a former president.

The crisis centres on Ueno Bank, a digital-first lender with accounts held by nearly half of Paraguay's population of about 6.5 million people. The central bank seized the bank on 3 November after its capital adequacy ratio fell below half the legal threshold, and ordered its liquidation. The bank also held more than $800 million in public money, including state pension funds.

An indictment against Peña states that between 2023 and 2026, Ueno Bank allegedly received deposits and loans from public and pension entities, and also allegedly granted loans to companies linked to the bank's economic group in an irregular manner. Peña owned shares in Ueno Holding, the bank's controlling company, until he sold them last year. He has denied wrongdoing.

Carvallo, who ran Ueno Bank until 2023 before being appointed central bank president, resigned on 3 November as the liquidation process began. He surrendered to the authorities on Friday night and was arrested. Eight of the bank's executives, including its founder, have also been arrested.

Thousands of people have taken to the streets in Asunción demanding their money back since the central bank took control of Ueno, and protesters gathered outside Peña's home calling for him to be held in a regular prison. The central bank said it had begun making advance payments to an unspecified number of depositors, while the deposit guarantee covers up to about $38,000 for each depositor.

Peña has been replaced by former vice president Pedro Alliana, who was sworn in as Paraguay's 53rd president on Friday and will serve out the remainder of the term, which ends in 2028. Alliana has promised not to abandon the almost three million depositors, including pensioners, affected by the bank's collapse. Some demonstrators were angered that Alliana, from the same Colorado Party as Peña, had taken over.

Writing on X on Saturday, Juan Pablo Segura, the US assistant secretary of state for Western Hemisphere affairs, called Paraguay a strategic partner, friend and ally of the United States and said Washington looked forward to working with Alliana.