Deputy Attorney General Rahmatullah Nazari said, Sherkhan Farnood, the former chairman of Kabul Bank and Khalilulah Frozi, its former chief executive officer were arrested by authorities on Wednesday.
The two officials have been arrested in connection of hundreds of millions of dollars in fraudulent loans to bank officers and insiders.
Mr. Nazari said the two officials are being detained at the attorney general’s office for further investigation but he declined to specify what charges have been brought against the two.
International community is likely to welcome the move.
Some aid have been held up by the international community until government action is taken on Kabul Bank.
The auditors have said that around $900 million in loans were made to insiders with little or no collateral and even no repayment plan.
Afghanistan’s Central bank chief, Abdul Qadir Fitrat has also been accused of taking millions in bribes to overlook the Kabul bank fraud.
The attorney general has also brought charges against Abdul Qadir Fitrat.
Mr. Fitrat fled to the United States just before those charges were brought, saying he feared for his life because of his efforts to expose the fraud.