* Raises 2017 after-tax profit to CZK 3.65 bln from 3.5 bln
* Ready to continue paying out excess capital in dividend
* Says Czech central bank's rate hike helps profitability
* Stock dips as Q2 profit boosted by sale of bonds
PRAGUE, Aug 10 (Reuters) - Moneta Money Bank raised its 2017 profit outlook and said it would continue paying out excess capital to shareholders as its second-quarter profit was lifted by a one-off bond sale.
The Czech Republic's sixth biggest bank reported a 3.7 percent drop in second-quarter after-tax profit to 1.155 billion crowns ($52 million) versus a 900 million forecast.
This was boosted by a 343-million crown gain from an extraordinary sale of bonds, while Moneta's net interest income and margin continued to fall and analysts said that the results had not reversed the declining trend of recent quarters.
"Without that (bond sale), the results are in line with expectations, perhaps even below on the operating level, hence the lukewarm market reaction," Patria Finance dealer Pavol Mokos said of Moneta's earnings on Thursday.
Moneta shares dropped to a one-month low of 78.3 crowns and were down 0.6 percent at 78.55 crowns at 0934 GMT, erasing moderate initial gains.
Despite the profit fall, Moneta raised its full-year outlook to 3.65 billion crowns from the 3.5 billion crowns it forecast in May. It has also confirmed its dividend policy.
"Our dividend policy is minimum 70 percent, last year we paid out 124 percent, distributing some of our excess capital, and we will act in the same spirit going forward," Chief Executive Officer Tomas Spurny told Reuters.
Czech banks have felt pressure on their profitability in recent years due to record low interest rates, a situation which has changed with the Czech central bank delivering its first interest rate hike in nearly a decade last week.
Spurny said that this would have a positive impact.
"The latest decision by the central bank... will improve profitability of our growth across retail and small business franchises that we operate." ($1 = 22.2760 Czech crowns) (Reporting by Robert Muller; editing by Alexander Smith)