Prosecutors were stepping up investigations into suspended savings banks on Sunday, as more allegations involving the top brass of embezzlement, accounting fraud and illicit lending surfaced.

On Friday, they secured an arrest warrant for an executive at Hanju Savings Bank who has vanished after allegedly siphoning off 1.6 billion won ($1.4 million) from 350 customer deposits on May 5.

The sum accounts for more than 10 percent of total assets run by the Yeongi, South Chungcheong-based institution, financial authorities said.

Investigators believe that the official distributed fake bankbooks to depositors and pocketed their funds. The victims reported the fraud to the Korea Deposit Insurance Corp. last week.

Hanju is one of the four Korean secondary lenders whose operations were suspended early this month for their failure to raise capital adequacy ratios according to the Bank for International Settlements standards. The other three are Solomon, Mirae and Korea.

On Sunday, Kim Chan-kyong, chairman of Jeju-based Mirae, was found to have tried to flee the country by plane to dodge the investigation and ensuing punishment over alleged irregularities.

The revelation marks another fleeing attempt by Kim, who was arrested on May 3 at a port in Hwaseong, Gyeonggi Province, while trying to depart for China on a blockade runner.

However, prosecutors did not say when he sought flight nor name the destination.

Kim, 55, was prohibited from leaving the country in September when authorities discovered his illegal acts during the second round of restructuring for seven savings banks.

As a suspension draws near, he allegedly took out 20 billion won from a company account at Woori Bank before arriving at the port, according to officials. He has since been handed over to the prosecutors.

Kim is suspected of giving out some 150 billion won in illegal loans to buy a local golf resort under a borrowed name, embezzling 20 billion won on the pretext of building a casino hotel in the Philippines and passing company stocks worth 27 billion won to a private lender in return for about 19 billion won in cash last month.

The four lenders are the latest in a series of savings banks suspensions. Earlier ones such as Samwha and Busan were found to have conducted illicit practices and lobbied financial authorities and political bigwigs to conceal their deteriorating operations.

Prosecutors suppose similar malpractices may have taken place at the four latest banks, such as giving tip-offs to their major customers about the imminent suspension to help them withdraw their deposits in advance.

With their search expanding, investigators last week raided the headquarters and major branches of the four institutions as well as the homes of their management on suspicions of embezzlement and issuing illegitimate loans.

The prosecution has also imposed travel bans on key officials and plans to summon them as soon as it completes analyzing the materials confiscated from the raid.

They found that the lenders have tried to avert suspension by issuing loans to each other to boost capital and fabricating balance sheets to cover up bad loans and increase their BIS ratios.

Solomon last month paid off some 3.7 billion won in loans its employees took out to buy its own shares.

Mirae and Solomon gave out tens of billions of won in loans to each other for capital increase.

The state-run KDIC began the procedure to sell off four distressed lenders last week.

By Shin Hyon-hee (heeshin@heraldcorp.com)