South Indian Bank shares came under sharp selling pressure in Friday’s morning trade, sliding as much as 19% to around Rs. 36 a share and hitting a three-month low, even as the broader market also traded weak.

The fall was triggered by the bank’s disclosure that Managing Director and CEO P R Seshadri has opted not to offer himself for reappointment at the end of his current term, which runs until September 30, 2026. The board said it will begin the process to identify a successor, with the eventual appointment subject to regulatory and shareholder approvals, a development that typically creates near-term uncertainty for investors until succession clarity emerges.

The reaction comes despite a solid Q3FY26 print announced earlier this month, with the bank reporting net profit of about Rs. 374 crore for the quarter ended December 2025, alongside improvement in asset quality and steady operating performance, factors that had supported the stock’s recent run-up. However, the leadership transition headline appears to have dominated sentiment on the day, prompting a swift derating move and profit-taking.

Going forward, investors are likely to track the pace and quality of the CEO search, interim continuity on strategy and execution, and any communication on succession timelines; until then, the stock could stay volatile despite the underlying earnings momentum.