The Vatican said in a statement that Paolo Cipriani and his deputy, Massimo Tulli, stepped down “in the best interest of the institute and the Holy See”.
Mr Cipriani, along with the bank’s then-president, was placed under investigation by Rome prosecutors in 2010 for alleged violations of Italy’s anti-money-laundering norms after financial police seized €23m from a Vatican account at a Rome bank.
Neither has been charged and the money was ordered to be released. However, the bank, known as the Institute for Religious Works, (IOR), has remained under the glare of prosecutors, and Pope Francis, amid fresh concerns it has been used as an offshore tax haven.
Last week, a Vatican accountant was arrested as part of prosecutors’ broadening investigation into the IOR.
Monsignor Nunzio Scarano is accused of corruption and slander in connection with a plot to smuggle €20m into Italy from Switzerland without reporting it to customs officials.
Scarano, dubbed “Don 500” by the Italian media because of his purported favourite euro banknote, said his behaviour was wrong but he was only trying to help friends.
The five cardinals overseeing the IOR accepted the resignations of Mr Cipriani and Mr Tulli and asked the IOR president, German financier Ernst von Freyberg, to serve as interim director.