The Paraguayan margin of the Itaipu Binacional plant seeks to recover about R$ 1 billion held in Ueno Bank, after the bank entered a resolution process by the BCP.
The Paraguayan administration of Itaipu Binacional has launched a legal and administrative offensive to reclaim roughly US$ 182 million kept in Ueno Bank. The amount, equivalent to about R$ 1 billion, was held after the Central Bank of Paraguay (BCP) ordered intervention in the financial institution due to serious solvency failures.
The episode casts doubt on the state-owned company’s treasury management. In its official balance sheet, Itaipu detailed that the blocked balance amounts to US$ 163.8 million and an equivalent of US$ 18 million in local currency. These funds were part of a diversification strategy aimed at ensuring liquidity and returns on the surplus from financial operations carried out between 2024 and 2026.
Context of the Ueno Bank crisis
The instability at Ueno Bank became public after the BCP discovered that the institution’s solvency ratio fell below 50% of the minimum required by law. Faced with the critical situation, the Paraguayan monetary authority appointed interventors to preserve the bank’s assets and safeguard depositors’ interests.
The Paraguayan state company ANDE (National Electricity Administration) also became involved in the mess. The company, which held deposits at the same institution, filed a criminal complaint against the bank’s executives, seeking precautionary measures to protect the public assets affected by the financial collapse.
“The company reaffirms that its financial policy allows investments exclusively in legally authorized banks with a AAA risk rating or equivalent, previously approved by the executive board.”
Operational impact and guarantees
Despite the magnitude of the retained amount, Itaipu’s board sought to reassure the market by stating that the situation does not compromise cash flow or the routine development of the hydroelectric plant’s activities. The binational company maintains that the blocked value represents 7.6% of the total resources managed during the period.
The outcome of the case, however, remains uncertain for amounts that exceed the local Deposit Guarantee Fund ceiling. While the BCP assesses the asset situation of Ueno Bank, the Paraguayan arm of Itaipu continues to monitor legal proceedings to avoid permanent losses, reiterating that investments in other financial institutions continue to yield positive results for the binational entity.