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MUMBAI : IDFC First Bank has cut the interest rate on savings accounts from 6% to 4-5% for accounts with a balance of more than 1 lakh and up to 2 crore. The new rates will be effective from 1 May, the bank said in its website.

The private sector lender is offering an interest rate of 4% for accounts with a balance of 2 crore to 10 crore, 5% for balances up to 2 crore and 4.5% for 1-10 lakh.

IDFC is one of the private sector banks, apart from RBL and Bandhan Bank, that is offering the highest savings account interest rates.

The private sector lender had cut the interest rate on savings accounts from 7% to 6% in February.

The bank has seen its current and savings account (CASA) ratio increase to 48.3% as on 31 December 2020 from 11.4% as on 31 March 2019.

Since the merger with Capital First in 2018, IDFC First Bank has morphed itself into a retail lender from a legacy infrastructure financier. It had given a guidance of CASA ratio of 30% by fiscal year 2024 and 50% thereafter.

According to estimates given for fiscal year 2021, IDFC First Bank had reported that its loan book grew at 10.09%, much higher than the industry’s growth. Its CASA ratio rose to 51.95% as of March from 31.87% a year ago. Deposits have grown at 43.15% year-on-year for the lender.

The bank had raised 3,000 crore through a qualified institutional placement (QIP) earlier this month.

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