Industrial Development Bank of India reduced the deposit rates across the different retail maturities by 25-50 basis points.

The bank has also realigned its maturity buckets for deposits.

The new rates would be effected June 25 onwards.

The rates on deposits above Rs.15 lakh & up to Rs.1 cr, with maturity between 1-2 yrs has been reduced by 50 percent per annum, while for deposits up to Rs.15 lakh, the rate has been reduced by 25 basis points to 7.25 percent per annum.

The rates on short-term deposits up to 6 months remains unchanged. The rates on deposits up to Rs.1 cr, for a period above 7 year and less than 10 years remains at 8.25 percent.

The rate of interest rate on ‘Tax Savings Suvidha deposits', with maturity period of 5 years, has been lowered to 8.00 percent per annum from the existing 8.50 percent per annum.

The interest rate applicable on all senior citizen deposits will be 50 basis points above the usual rates. The bank also indicated premature withdrawals will attract a penalty of 1 percent.

In the pre-budget meeting held on 10th July 09, between the Union Finance Minister, Pranab Mukherjee and top officials of PSBs, the minister urged the bankers to lower the interest rates.

Earlier this month, State Bank of India reduced deposit rates by 25 basis points, following which its largest subsidiary, the State Bank of Bikaner and Jaipur, lowered the deposit rates across all maturities by up to 100 basis points.