AB Bank has run into a leadership vacuum after its managing director and chief financial officer were among the 16 accused of embezzling Tk 383 crore from the bank by the Anti-Corruption Commission.

Following the filing of the corruption case on June 28, Moshiur Rahman Chowdhury, managing director of AB Bank, and Mahadev Sarker Sumon, chief financial officer and company secretary, have stopped coming to office.

Ten other senior and mid-level officials who were accused in the case are also not attending office.

As a result, many vital internal matters have remained pending, including loan disbursement. The Daily Star tried to get in touch with Chowdhury but his mobile phone remained switched off.

Amid this crisis, the board has entrusted the management of the bank to MA Abdullah, currently the deputy managing director, according to M Wahidul Haque, chairman of AB Bank.

The ACC on June 28 filed a case against Mehboob Chowdhury, chief executive officer of Citycell; former foreign minister M Morshed Khan and his wife Nasrin Khan; and 12 senior officials of AB Bank with the Banani Police Station for allegedly embezzling over Tk 383 crore from the bank between 2011 and 2015.

An ACC team led by its Deputy Director SK Abdus Salam arrested the Citycell CEO at Hazrat Shahjalal International Airport on July 1 upon his arrival in Bangladesh from Sri Lanka. He was granted bail on the same day on grounds of ill health.

AB Bank unlawfully guaranteed loans of Tk 348.5 crore given to Pacific Bangladesh Telecom Ltd (PBTL), Citycell's parent company, by eight other banks and non-bank financial institutions, according to the case statement.

The board and other top officials of AB Bank approved the move without taking any collateral from PBTL, which is in violation of the Bangladesh Bank's rules.

Meanwhile, AB Bank is going through a financial crunch due to the loan corruption. The bank last year came short in its provisioning requirement.

The first generation private commercial bank kept only Tk 250 crore as provisioning against the required Tk 1,590 crore, because of bad loans mostly at its offshore banking unit.

The bank will face a capital shortfall if full provisioning is maintained. As of December last year, its capital base stood at Tk 3,064 crore.

In 2106, AB Bank restructured large loans of more than Tk 1,300 crore of six business groups under a special facility offered by the BB.

Amid this situation, the BB on May 3 appointed Sheikh Mozaffar Hossain, a general manager of the central bank, as an observer to AB Bank to closely monitor the bank's financial activities.