SunTrust profit higher on loan balances, lower credit losses
() The Atlanta-based bank attributed growth to improved credit quality among borrowers and a larger portfolio of consumer and commercial loans. Revenue for the quarter decreased 5% to $2.2 billion from $2.3 billion last year. The third-quarter provision for loan losses fell 44% to $347 million from $615 million a year earlier. The bank's loan quality continued to improve with the percentage of net charge offs falling to 1.69% from from 2.42% last year. Meanwhile, nonperforming loans made up only 2.76% of the bank's portfolio in the recent quarter, compared to 3.8% a year ago. New business in the mortgage segment, which was partially driven by low interest rates, pushed the company's mortgage production income to $54 million, compared to $4 million last year. Loan repurchasing costs hit $117 million on higher agency-related repurchase requests, SunTrust said. Meanwhile, reserves for mortgage repurchases fell $17 million to $282 million from the second quarter after more loan resolutions were made. Mortgage production year-over-year still declined by $79 million as refinancing demand declined. Income also fell on the mortgage servicing side to $58 million in the third quarter, compared to $72 million in the second quarter and $132 million from last year. The company said the firm is always at risk of facing adverse changes due to "weakness in the real estate market, including the secondary residential mortgage loan markets." Write to Kerri Panchuk.