New Delhi, Oct. 29 -- Equitas Small Finance Bank said on Thursday that its longtime managing director and chief executive officer, P N Vasudevan, would step down, citing personal and social initiatives. The announcement sent the bank's shares tumbling as much as 20% during the trading session.

In his resignation letter, Vasudevan said he wanted to remove an "overhang" on the bank's stock stemming from perceived conflict-of-interest concerns involving his daughter, who co-promoted a non-banking financial company (NBFC) licensed by the Reserve Bank of India (RBI) in 2023.

"In my investor meetings over the past 3 years, I have been repeatedly asked about the perceived conflict of interest. In reality there is no conflict of interest, since...