Chennai, Jan 23 (IANS): City-based Indian Bank has decided to sell off some of its big loan defaulting accounts to asset reconstruction companies and cut down its non-performing assets (NPA), said a top bank official here Thursday.

"We have identified 19 big accounts to be sold to asset reconstruction companies. Each account would have an outstanding of Rs.5 crore and above. Approximately the total outstanding to the bank on these accounts will be around Rs.300 crore," chairman and managing director T.M. Bhasin told reporters after announcing the bank's third quarter results.

He said the bank would put large value NPAs on the block so as to reduce its burden.

Last quarter, the bank assigned NPAs aggregating to Rs.389.97 crore (net of provisions) to asset reconstruction companies for a total consideration of Rs.675.51 crore.

At the end of third quarter, the bank's gross NPA stood at Rs.3,834,79 crore and the net NPA at Rs.2,483.61 crore.

"Over the last two years, the bank has faced severe asset quality pressures, as gross and net NPAs propelled from 1.4 percent and 0.8 percent, respectively to 3.4 percent and 2.2 percent," states a research report from Angel Broking.

According to Bhasin, the bank would be inaugurating 108 branches next month. Presently the bank has 2,139 branches.

Indian Bank will also open three more branches in Sri Lanka, taking the total number of overseas branches to six.

According to Bhasin, the bank's extra-ordinary general meeting will be held Feb 10 here to get the shareholders' approval to convert Rs.400 crore worth of perpetual non-cumulative preference shares held by the central government into equity.

For the quarter ended Dec 31, 2013, the bank posted a net profit of Rs.264.50 crore down from Rs.330.58 crore posted during the corresponding period of the previous fiscal.