Ueno Bank’s solvency ratio could fall from 12.4% to about 6.12% at the end of 2025 if investments in two related companies were deducted from core capital, as required by Law No. 861/96, Paraguay’s General Banking Law. The estimated ratio would be below the legal minimum of 8% for Tier 1 capital.
The conclusion results from comparing the bank’s financial statements with information presented in an offering memorandum to investors on the United States stock market, filed in March 2026. In the document, Ueno Bank reported an 86.02% stake in Red Digital de Procesamiento SA, known as UPay, through investments of G. 640.469 billion (about US$106 million). It also reported a 72.12% stake in Red Digital SA, known as Wepa, corresponding to G. 236.231 billion (US$40 million).
The two holdings exceed the 51% threshold established by law for an entity to qualify as a subsidiary. Under the rule, investments in controlled companies must be deducted from the core capital used to calculate effective capital. Combined, the amounts total G. 876.7 billion (US$146 million).
In its local balance sheet for December 2025, however, the bank classified the funds as a “minority” stake and “irrevocable contributions for future capitalizations,” without detailing the portion consisting of common shares. This presentation means, according to an analysis published by ABC Color, that the degree of corporate control cannot be confirmed directly from the local statements. The claim that information was concealed and that regulators should have required adjustments was not independently corroborated by other sources in the available material.
After G. 876.7 billion was deducted, the core capital reported by the bank—G. 1.73 trillion—would be reduced to G. 853.806 billion. Considering risk-weighted assets and contingencies of more than G. 13 trillion, the estimated ratio would be approximately 6.12%, below the 8% required for Tier 1 capital. The legislation also establishes a combined ratio of 12% to 14% for Tier 1 and Tier 2 capital.
The case also affects the capital market. Ueno Bank issues securities locally, and regulations require the disclosure of material facts capable of significantly affecting an issuer’s financial position. The material analyzed states that the investments in UPay and Wepa were not reported in this manner to the National Securities Commission, whose structure is now part of the Central Bank of Paraguay.
Ueno Bank is controlled by Grupo Vázquez SAE, chaired by Federico Miguel Vázquez. The institution also ranks among the main institutions holding public funds and funds from IPS, Paraguay’s social security and public health institution, with US$863 million accumulated through July, according to the cited assessment. The gap between the disclosed ratio and the calculation that includes the linked holdings places under scrutiny how the bank classifies its investments and how banking supervision treats these contributions.