WASHINGTON, Nov 24 (Reuters) - The U.S. thrift industry reported a slender profit in the third quarter, its first profit in two years after a downward revision in prior data, the Office of Thrift Supervision said on Tuesday.
The OTS, which largely regulates mortgage lenders, said the industry reported a profit of $1.3 billion, but $1.1 billion of that amount was due to one thrift's large nonoperating gain.
Excluding that gain, thrifts earned $200 million in the quarter, a slight improvement from the prior quarter, which was revised to a loss of $94 million from a previously reported profit of $4 million.
The OTS said the small profit in the third quarter was primarily due to higher net interest margins and higher other non-interest income.
Those gains were partially offset by higher loan loss provisions. Thrifts set aside an additional $4.9 billion to cover souring loans in the quarter, a near-record level, due to the continued housing market downturn and rising unemployment.
"We see some encouraging signs, but we also see signs that give us pause," OTS Acting Director John Bowman said in a statement.
The number of "problem thrifts" rose to 43 at the end of the third quarter from 40 in the prior quarter.

(Reporting by Karey Wutkowski; editing by John Wallace)

((E-mail:karey.wutkowski@thomsonreuters.com +1 202 898 8374)) Keywords: THRIFTS/EARNINGS
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