Business EconomyPosted at: Oct 30 2026 2:17PM


Equitas SFB CEO resigns amid investor concerns over conflict of interest

New Delhi, Oct 30 (UNI) Equitas Small Finance Bank Managing Director and Chief Executive Officer P N Vasudevan has resigned, citing persistent investor concerns over a perceived conflict of interest linked to his daughter's association with a non-banking financial company (NBFC). The resignation comes barely three months after the bank's board extended his tenure until July 2029.
The development triggered a sharp sell-off in the lender's shares. Equitas SFB stock plunged 20 per cent during intra-day trading to hit its lower circuit before recovering partially to close 12 per cent lower at Rs 56.99 on the BSE.
In his resignation letter dated October 29, Vasudevan said that concerns over a potential conflict of interest had continued despite his clarifications to investors that there were no ongoing business dealings between Equitas SFB and the NBFC. He said the issue had begun affecting the bank's share price and was undermining efforts to create value for shareholders and employees.
Vasudevan maintained that his position as the head of a bank and his daughter's role as co-promoter of an NBFC were within the regulatory framework of the Banking Regulation Act. He said the NBFC received its Reserve Bank of India (RBI) licence in 2023 and that his association with Equitas, along with his daughter's involvement in the financial services company, had been disclosed to the bank's board and the central bank.
Clarifying the nature of business dealings between the two entities, Vasudevan said there had been no transactions between Equitas SFB and the NBFC, apart from a short-term deposit placed approximately two and a half years ago, which was repaid upon maturity. He added that neither entity had entered into any other transactions, including lending arrangements.
However, the former MD said the issue had repeatedly surfaced during investor interactions over the last three years. Arguing that market perceptions were affecting the bank despite the absence of any ongoing business relationship, he said his departure would help remove the uncertainty surrounding the lender's stock and allow its financial performance to receive greater investor recognition.
The bank's board acknowledged his resignation at a meeting on Thursday and requested him to continue in the position until a successor is appointed. The nomination and remuneration committee will begin the search for a replacement, considering both internal and external candidates. The appointment will require approval from the RBI and other relevant regulatory authorities.
Vasudevan established Equitas as a microfinance institution in 2007 and subsequently steered its transformation into a small finance bank in 2016. Before setting up Equitas, he worked with Cholamandalam for nearly two decades and later had a brief stint at DCB Bank.
In his resignation letter, Vasudevan indicated that he intends to take a break after spending nearly 20 years building the Equitas franchise. He also expressed his intention to focus on creating a corpus for a trust aimed at supporting a different section of society.
The leadership change comes at a time when Equitas SFB has reported strong growth in its business operations. Vasudevan said the bank's total business crossed the Rs 1 lakh crore milestone in the quarter ended September 2026. It also posted its highest-ever quarterly profit of Rs 218 crore during the period.
UNI VK RSA
Tags: #Equitas SFB CEO resigns amid investor concerns over conflict of interest
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