By Jeff McKinney
The Cincinnati Enquirer

Substantially less money set aside to cover potential bad loans helped Provident Financial Group Inc. post stronger third-quarter profits.

The parent of Cincinnati's Provident Bank earned $30.4 million, or 60 cents a share, versus a loss of $7.4 million, or 16 cents a share, during last year's third quarter, the banking company said Wednesday.

The results also showed that efforts Provident has implemented in recent quarters - to improve asset quality and reduce credit risks tied to commercial lending - are apparently paying off.

Provident said the provision for loans and leases was $25.1 million in the third quarter, down from $66 million in last year's third quarter.

The $16.2-billion-asset bank also said higher income from fee-based businesses and deposit growth helped boost earnings.

Provident's management said improving credit quality remains the bank's No. 1 priority and that it's pleased with the progress the bank is making.

Credit costs tied to problem loans - mainly business loans hurt by a weak economy and last year's terrorist attacks - have dragged down the bank's profits in recent quarters.

The bank also said third-quarter profits rose as its retail and fee-based businesses grew.

Provident said retail and commercial deposits grew 10 percent to $6.4 billion.

The bank also said quarterly revenue grew 2.4 percent to $185.2 million.