Valley National Bancorp's (VLY) profit fell by nearly a third in the third quarter as the Wayne, N.J.-based company saw a substantial decrease in net gains on sales of residential mortgages.

The $16 billion-asset Valley National earned $27 million in the third quarter, a 31% decline from the same period in 2012. At 14 cents, earnings per share were a penny below the estimates of analysts polled by Bloomberg.

Noninterest income dropped 45%, to $22.4 million. Falling volumes of new and refinanced residential mortgage originations contributed to the bulk of the decline, according to Valley National. Noninterest expenses ticked up 1%, to $94.5 million. The company closed three New Jersey branches and one New York City branch in the third quarter in a move to contain costs.

Valley National's net interest income slipped 8%, to $111.7 million, with interest and fees on loans also declining by 8%. Its net interest margin declined 26 basis points, to 3.20%.

Net chargeoffs on non-covered loans rose 54% to $9.1 million because of $8.9 million in chargeoffs from a single large commercial borrower. Net loan chargeoffs otherwise remained at low levels. The company took a $5.3 million provision for loan losses, down 27% from the same period in 2012.

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