SAO PAULO, Oct 29 (Reuters) - Santander Brasil's

third-quarter net profit jumped 34.3% from a year

earlier, the bank said on Tuesday, topping market forecasts on

higher volumes and fees.

WHY IT'S IMPORTANT

Brazil is a key market for Spanish parent Banco Santander

, which reported its own third-quarter results earlier

in the day, booking a record net profit thanks to a solid

performance at its main retail business.

Santander is typically the first big private lender in

Brazil to publish quarterly results, setting the tone for

upcoming reports from peers such as Itau Unibanco ( ITUB ) and

Bradesco.

BY THE NUMBERS

Santander Brasil's quarterly net profit came in at 3.66

billion reais ($640.8 million), it said in a securities filing,

above the 3.50 billion expected by analysts polled by LSEG.

Net interest income (NII) - earnings on loans minus deposit

costs - rose 15.8% to 15.23 billion reais. Return on average

equity (ROAE), a gauge of profitability, hit 17%, up 3.9

percentage points.

The lender's allowance for loan losses grew 4.7% to 5.88

billion reais, while the expanded loan portfolio rose 6.1% to

663.5 billion reais.

KEY QUOTES

"Our volumes performance results from discipline in capital

allocation, prioritizing operations with higher profitability

and good asset quality," Chief Executive Mario Leao said, adding

that portfolio diversification allowed for an increase in fees.

"The allowance for loan losses remained controlled, growing

at a slower pace than our credit portfolio," he noted. "We will

start 2025 ready to continue our path to evolve ROE. We will

maintain a consistent evolution of our profitability."

($1 = 5.7113 reais)