Tanzania's Central Bank Governor Daudi Ballali has been sacked after an independent international audit exposed fraudulent transactions.
Mr Ballali is apparently in hospital in the United States
The audit established that more than $120m (£60m) was improperly paid by the bank to dozens of local companies, many of them reportedly fictitious.
The president has been angered by the revelations, his spokesman said.
When Jakaya Kikwete came to power in 2005 he proclaimed the fight against corruption one of his priorities.
International accountancy firm Ernst & Young, which carried out the audit, found that 22 local companies, many of them apparently fictitious, had benefited from the payments through the bank's external payment arrears account.
President Jakaya Kikwete has ordered an investigation into all firms mentioned.
"The president has been deeply angered and disappointed with what has happened," presidential spokesman Philemon Luhanjo said.
The BBC's John Ngahyoma in Dar es Salaam says Mr Ballali's whereabouts have been a mystery for some time, with some people saying he had jumped ship, others accusing the government of a cover-up.
But Mr Luhanjo said Mr Ballali was in hospital in the United States and will be replaced by Deputy Bank Governor Benno Ndulu.