Popular in San Juan, Puerto Rico, reported higher third-quarter profits, as an increase in mortgage banking and lower operating costs.

The $35.5 billion-asset bank's net income rose 37.4% to $84.7 million, from a year earlier. Earnings per share rose 165% to 82 cents. That met the average estimate of analysts polled by Bloomberg.

Net interest income, after a provision for loan losses, rose 15.6% to $284.1 million. The net interest margin narrowed by 25 basis points to 4.39%.

Noninterest income rose 5.5% to $131.1 million, as income from mortgage banking activity rose 67.4% to $24.2 million.

Noninterest expense fell 1.2% to $306.9 million. Personnel costs increased significantly but were partially offset by sharp declines in taxes and other real estate owned expenses.

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