* Q3 profit $0.19/shr vs est $0.17/shr
* Commercial and industrial loans up 18 pct
* Net interest income up 6 pct from year ago
Oct 18 (Reuters) - Huntington Bancshares Inc's third-quarter profit narrowly beat analysts' estimates as it lent more to commercial and industrial businesses, boosting its net interest margin.
The bank also said average net interest income was expected to remain relatively stable for the next several quarters as higher lending, especially to commercial and industrial customers, was likely to be offset by competitive pressures on loan pricing.
Most U.S. banks are seeing shrinking margins as customers refinance their loans to take advantage of low interest rates.
However, Huntington's net interest income -- the difference between what a bank earns on loans and pays out on deposits -- rose 6 percent in the third quarter to $430.3 million.
Commercial and industrial loans rose 18 percent to about $16.5 billion, while total loans rose 2 percent to $40.1 billion.
The company, however, said commercial real estate loans would likely fall further. For the latest quarter, commercial real estate loans fell 7 percent, reflecting a continued runoff of its noncore portfolio.
The Columbus, Ohio-based bank's earnings rose to $167.8 million, or 19 cents per share, from $143.4 million, or 16 cents per share, a year earlier.
Analysts on an average had expected earnings of 17 cents per share, according to Thomson Reuters I/B/E/S.
Huntington shares closed at $7.05 on Wednesday on Nasdaq.