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The second choice is the correct one. This is because the word "unnecessarily" is addressing the question of "how" the resources of the bank are being diverted, which requires an adverb, and "unnecessarily" is an adverb. (Note the "ly" at the end of the word). The word "unnecessary" is an adjective, which would be used to describe or modify a noun. For example, one could say that diversion of the bank's resources was unnecessary. In this case, "unnecessary" refers to and describes the word "diversion".

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Q: Is it correct to say 'resources of the Bank are being diverted unnecessary' or 'resources of the Bank are being diverted unnecessarily'?
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Related questions

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The word "unnecessary" (not required) is spelled with two N's and two S's.


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