* Q1 EPS 97 cents, adj. EPS 57 cents
* Higher interest rates drive gains
* Shares up 3.4 percent (Adds details from statement, outlook from presentation, shares)
By Aparajita Saxena
April 24 (Reuters) - Fifth Third Bancorp posted a better-than-expected quarterly profit on Tuesday as higher interest rates helped the bank earn more from loans and other interest-bearing assets.
For the second quarter, the Ohio-based regional bank forecast a modest increase in both consumer and commercial loans, versus the first quarter. It predicted net interest income of between $1.025 billion and $1.030 billion.
In the first quarter, net interest income rose to $999 million from $939 million a year ago, on higher interest rates.
U.S. banks have benefited from higher interest rates since the Federal Reserve started raising them in 2015. Higher interest rates allow banks to charge customers more for loans.
For borrowers too, relatively lower interest rates present a good opportunity to take out loans. The Fed has projected two more interest rate hikes this year, but policymakers foresee three being required to prevent the economy from overheating.
Earlier this month, regional lender PNC Financial Services also said it expects modest loan growth in the second quarter.
For the first-quarter, Fifth Third's net income attributable to common shareholders rose to $689 million, or 97 cents per share, from $290 million, or 38 cents per share, a year earlier. reut.rs/2JmYByF
The quarter included a one-time gain of $327 million on after-tax basis, related to U.S. credit card processing company Vantiv’s merger with UK-based Worldpay. Fifth Third owns nearly 4.9 percent interest in Vantiv, convertible into shares of Worldpay, as of March 31.
On an adjusted basis, the company earned 57 cents per share. (bit.ly/2qUkgYg)
When adjusted for a gain and other charges, the company earned 53 cents per share, which is comparable to estimates of 48 cents per share, as per Thomson Reuters I/B/E/S.
Shares of the Ohio-based bank were up 3.4 percent at $33 in premarket trading.
Total average portfolio loans and leases in the first quarter rose marginally to $92.3 billion.
Provision for loan and lease losses fell 69 percent to $23 million.
Total noninterest expenses rose 6 percent to $1.05 billion, Fifth Third said. (Reporting By Aparajita Saxena in Bengaluru; Editing by Shailesh Kuber)