Oct 17 (Reuters) - Truist surpassed Wall

Street's third-quarter profit estimates on Thursday, driven by

higher income from investment banking and trading amid a

recovery in capital markets activity.

After over two years of sluggish activity due to rising

interest rates and stock market volatility, banks are seeing a

resurgence in investment banking businesses, as corporate

clients pursue large mergers and acquisitions, debt and equity

sales, and previously deferred initial public offerings.

Truist said non-interest income rose 11% to $1.48 billion in

the third quarter ended Sept. 30 from a year earlier, driven by

higher equity and debt underwriting volumes.

Its quarterly investment banking and trading income surged

79.5% to $332 million.

Truist's results mirror larger rivals such as JPMorgan Chase ( JPM )

, Morgan Stanley ( MS ) and Citigroup ( C/PN ), which also

surpassed third-quarter profit targets on investment banking

gains.

Meanwhile, net interest income (NII), or the difference

between what a bank earns on loans and pays out on deposits,

rose 1.8% to $3.66 billion in the quarter. Net interest margin,

which measures lending profitability, expanded to 3.12% versus

2.92% a year earlier.

The bank said the higher NII was driven primarily by balance

sheet repositioning.

"We made considerable progress on driving revenue growth

through our core banking business by adding new clients," said

Truist CEO Bill Rogers in a statement. "Asset quality metrics

were better than our expectations."

Truist reported an adjusted profit of 97 cents per share in

the quarter, compared with analysts' average expectations of 91

cents per share, according to estimates compiled by LSEG.

Net income available to common shareholders rose to $1.34

billion or 99 cents per share, versus $1.07 billion or 80 cents

per share, a year earlier.

Shares in the bank rose 0.6% in thin premarket trading after

the results.