Singh, 68, missing since the irregularities in the PMC Bank tumbled out two weeks ago, was traced to a location in Mahim where he was in hiding and picked up, a Mumbai Police spokesperson said.
The police said that he will be interrogated for his prima facie involvement in the alleged Rs 4,355 crore fraud case concerning the Housing Development & Infrastructure Ltd (HDIL).
Earlier on Saturday afternoon, Waryam Singh created a flutter by sending a signed, type-written letter to the EOW DCP Parag Manere, stating that he planned to surrender before the EOW by evening and was also willing to cooperate.
However, the police team, which was already keeping a watch at his Andheri residence, quickly got cracking to flush him out of his hiding place near the Mahim Church.
The latest development came a day after the PMC Bank's missing Managing Director Joy Thomas was arrested in connection with the same case.
This is the third major arrest in the case in the past three days. Earlier on Thursday, the police nabbed HDIL Chairman and Managing Director Rakesh Kumar Wadhwan and Sarang Wadhwan, respectively, and their asserts worth Rs 3,500 crore were frozen.
Last Monday, the EOW had registered a case against the PMC Bank and the HDIL for causing alleged losses worth Rs 4,355 crore to the bank between 2008 and 2019 in the Bhandup branch.
Simultaneously, the Enforcement Directorate (ED) on Friday launched a separate investigation for money-laundering and carried out raids in six locations in Mumbai.
ED sources said that an enforcement case investigation report, equivalent to a police FIR, was lodged following a complaint by PMC Bank's Manager (recovery department) claiming that over 21,000 fictitious accounts were created to suppress the stressed loan accounts of the HDIL, flouting the Reserve Bank of India norms.
The Mumbai Police FIR has named Thomas, Waryam Singh, the Wadhawans and other officials and a Special Investigation Team (SIT) has been formed to probe the case.
On September 24, the RBI slapped six-month sanctions restraining the PMC Bank from carrying out a majority of its routine businesses, sparking huge panic among depositors and shocking the banking and corporate circles ahead of the festival season.
( With inputs from IANS )