Equitas Small Finance Bank CEO resigns; stock crashes 20% despite record

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By BL Mumbai Bureau

Updated - October 29, 2026 at 03:54 PM.

Equitas Small Finance Bank shares hit the lower circuit even as the lender reported record quarterly net profit.

Shares of Equitas Small Finance Bank collapsed nearly 20 per cent to ₹52.11 on Thursday after the Chennai-based lender disclosed that its founder and Managing Director & CEO, P. N. Vasudevan, has submitted his resignation, even as the bank reported its highest-ever quarterly net profit of ₹218 crore for the quarter ended September 30, 2026.

The stock opened at ₹66, hit a high of ₹69.70, and plunged to its lower circuit band of ₹52.11 by mid-afternoon, wiping out nearly ₹1,500 crore in market capitalisation. Traded volumes surged to 655 lakh shares, reflecting heavy selling pressure.

Vasudevan resigns over perceived conflict-of-interest concerns

Vasudevan, who has led Equitas since its inception as a microfinance institution in 2007 and steered its transition into a Small Finance Bank in 2016, said in his resignation letter to Part-Time Chairman Anil Kumar Sharma that he was stepping down to remove a “perception overhang” around a potential conflict of interest. His daughter is a co-promoter of an NBFC that received an RBI licence in 2023. Vasudevan maintained that no financial transactions occurred between the bank and the NBFC, except for a short-term deposit roughly two and a half years ago that was repaid at maturity. However, he acknowledged that investor concerns about this perceived conflict had weighed on the stock.

At its meeting on October 29, 2026, the Board of Directors noted the resignation and agreed to it. Vasudevan has agreed to continue as MD & CEO until a successor is in place. The Board has directed the Nomination and Remuneration Committee to identify candidates from within and outside the bank. Any appointment will require RBI approval.

Net profit rebounds to ₹218 crore in September quarter

On the financial side, the bank’s unaudited results for the half-year ended September 30, 2026 showed net profit of ₹401.6 crore, a sharp turnaround from a net loss of ₹199.6 crore in the same period last year. Total income for the quarter rose to ₹2,357.5 crore from ₹1,846.3 crore a year earlier. Gross NPA ratio improved to 2.29 per cent from 2.92 per cent a year ago. Total business crossed ₹1 lakh crore during the quarter.

Board approves chairman’s reappointment and office shift

The Board also approved re-appointing Anil Kumar Sharma as Part-Time Chairman for a further three years from April 25, 2027. It also approved shifting the bank’s registered office to Equitas Towers, Little Mount, Saidapet, Chennai, effective October 30, 2026.

Published on October 29, 2026

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