TFS Financial in Cleveland posted a double-digit profit increase in the quarter that ended June 30 thanks to a combination of improved credit quality and lower expenses.

The $12.6 billion parent of Third Federal Savings and Loan Association said in a press release Thursday that its net income rose 19.4% in its fiscal third quarter compared with a year earlier, to $20.6 million.

Ongoing improvements in loan performance led to a negative provision for loan losses of $3 million compared to no provision a year earlier.

Noninterest expenses fell 5.9% to $44.9 million as a result of reductions in marketing costs, the state franchise tax, and federal insurance premium and assessments.

Total loans increased 3.5% to $11.3 billion, while the net interest margin rose 3 basis points to 2.22%. But net interest income remained relatively flat at $67.3 million due to a decline in average earning assets. Noninterest income held steady, at $6.1 million.

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