Chennai, July 23 (IANS): Government-owned mortgage lender Indian Bank plans to hold an online auction of pledged properties in a major way next month, said a top bank official on Thursday.

"Next month we plan to auction online the properties mortgaged relating to around 280 accounts," M.K. Jain, managing director and CEO, told reporters here on Thursday.

He said the amount lent by the bank to the 280 loan accounts will be in the region of Rs.600 crore.

He said the bank has been holding e-auctions on standalone basis and next month the auction would be on a consolidated one.

According to Jain, the bank has created a separate vertical to look into loan accounts above Rs.1 crore and monitor them closely.

For delinquent loan accounts where the borrowing is less than Rs.1 crore, action under the SARFAESI Act - The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act - would be taken.

Jain said the bank has started sending SMS to the borrowers reminding them of the loan due repayments.

Queried about the bank's plans to reduce the lending rates, Jain said a decision would be taken after the Reserve Bank of India (RBI) announces its monetary policy next month.

According to Jain, Indian Bank achieved a total business (deposits plus advances) of Rs.300,436 crore (deposits Rs.175,438 crore, advances Rs.124,998 crore) during the first quarter of the current year.

He said the bank curtailed the increase of non-performing assets (NPA) to Rs.145 crore during the quarter under review - the lowest in the last 12 quarters.

He said the bank closed the first quarter with a net profit of Rs.215 crore, up from Rs.207 crore logged during the corresponding period of previous year.

Indian Bank posted a total income of around Rs.4,494 crore during the first quarter, up from Rs.4,144 crore earned during the first quarter of 2013-14.

Jain said the bank shed high cost deposits to the tune of Rs.2,585 crore to reduce its deposit cost to 6.94 percent from 7.14 percent.