Karnataka Bank Share Price Crashes Over 8% After CEO and ED Resign; Here's What Triggered the Fall

Karnataka Bank share price nosedived nearly 8.4% intraday on Monday after the private sector lender announced the resignation of its Managing Director & CEO, Srikrishnan Hari Hara Sarma, along with its Executive Director, Sekhar Rao.

The sudden leadership exit triggered heavy selling in the counter, leading to a sharp correction in Karnataka Bank shares which had otherwise been trading in a narrow range last week.

Why Karnataka Bank Share Price Fell Today

In a regulatory filing on Sunday evening, Karnataka Bank Ltd, headquartered in Mangaluru, informed exchanges that both Sarma and Rao had submitted their resignations citing personal reasons.

The lender stated "The Board of Directors of Karnataka Bank has accepted the resignation of the Bank's Managing Director & CEO, Mr. Srikrishnan Hari Hara Sarma. His resignation will be effective from July 15, 2025. Mr. Sarma cited personal reasons and his decision to relocate back to Mumbai. Executive Director Mr. Sekhar Rao has also stepped down, citing his inability to relocate to Mangaluru and other personal reasons. His resignation will take effect from July."

Karnataka Bank Share Price Movement

The scrip opened 4% lower today at Rs. 199 against the Friday's close of Rs. 207.65. It further fell to intraday low of Rs. 190 slipping 8.4% .

Karnataka bank shares last week traded mostly flat around Rs. 205-208. In the last one year the shares fell 12.50% and 8% so far this year.

Karnataka Bank Share Target Price and Broker View

According to a stock research report by Axis Securities dated May 27, the brokerage gave a 'Buy' rating on Karnataka Bank shares, setting a target price of Rs. 270, suggesting a 38% upside potential from current levels.

The report cited improvement in the bank's digital capabilities, retail expansion, and balance sheet health as positive triggers. " With investments made and strengthening processes and teams ripe to yield results, we expect KTKBANK to resume its growth journey, though gradually from FY26E onwards. Focus on granular retail deposits, particularly CASA deposits, remains unabated. We believe KTKBANK has multiple levers in place to protect and improve its margins over the medium term, thereby enabling the bank to improve RoAs. With a majority of the investments already made, Opex growth is expected to remain modest, driving cost ratios downwards" as mentioned in the report.

About Karnataka Bank

Karnataka Bank Limited is one of the major private sector banks in India, headquartered in Mangaluru, Karnataka. Established in 1924, the bank has grown over the decades to become one of India's leading 'A' Class Scheduled Commercial Banks, operating under the regulation of the Reserve Bank of India.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute financial, investment, or credit advice. The views and recommendations mentioned are based on publicly available data and expert opinions at the time of writing. Neither the author nor GoodReturns endorses any specific product or financial decision. GoodReturns.in and its affiliates are not responsible for any loss or damage resulting from reliance on the information presented.