S&T Bancorp's third-quarter profits plunged 51 percent, dragged down by a higher provision for loan losses, higher deposit insurance premiums and write-downs on investments.

The Indiana, Pa.-based bank posted net income of $7.7 million, or 28 cents per share, down from $15.7 million, or 57 cents, in the same quarter last year.

"We continue to make significant progress working through the difficult economic environment," CEO Todd Brice said in a statement this morning.

The provision for bad loans was $8.4 million, up from $6.2 million in the third quarter of 2008, but down from $21.4 million and $32.2 million in the first and second quarters of this year.

The bank's commercial loan portfolio remained "troubled," but the residential mortgage and home equity portfolios continued to perform "relatively well," Mr. Brice said.

Net interest income fell to $38.1 million from $40.6 million. Non-interest income slipped to $10.3 million from $10.6 million.

Investment security losses were $2.1 million in the third quarter vs. $341,000 a year earlier. The Federal Deposit Insurance Corp.'s premiums rose to $1.5 million vs. $131,000.

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