SunTrust Banks Inc , a large U.S. Southeast regional bank, posted its third straight quarterly loss on Wednesday, hurt by an increase in soured commercial and residential loans.

The net loss applicable to common shareholders of the Atlanta-based bank was $164.4 million, or 41 cents per share, versus a profit of $530 million, or $1.52, a year earlier.

Recession-related costs continue to impact our results, Chief Executive James Wells said in a statement.

He said he was encouraged by the bank's growth in deposits and net interest margin, efforts to cut costs, and a decline in early-stage delinquencies measuring borrowers who fall behind on payments for the first time. SunTrust has cut nearly 3,100 jobs, or 10 percent of its work force, in the last year.

Analysts on average forecast a quarterly loss of 51 cents per share, according to Reuters Estimates.

Results included several one-time items related to capital-raising, including a gain from the sale of Visa Inc shares. SunTrust took a charge of $48.4 million to contribute to a federal deposit insurance program.

Borrowers on $5.5 billion of loans, or 4.48 percent of all SunTrust loans, were not current on payments.

The bank set aside $962.2 million for credit losses, more than twice the year-earlier level. Net charge-offs totaled $801.2 million, with increases in nearly all categories, and included $116.2 million for fraud and denied insurance claims.

Net interest margin, the difference between what the bank earns on loans and pays on deposits, rose to 2.94 percent from 2.87 percent in the first quarter.

SunTrust took $4.9 billion of money from the government's Troubled Asset Relief Program, but regulators have not allowed it to repay that sum.

The bank was one of 19 large U.S. banks to undergo stress tests of their ability to weather a deep recession. It was ordered to raise $2.16 billion, which it has done.

SunTrust ended June with $176.7 billion of assets. It operates 1,692 branches in 11 U.S. states and Washington, D.C.

Shares of SunTrust closed Tuesday at $15.18 on the New York Stock Exchange. Through Tuesday they had fallen 49 percent this year, compared with a 19 percent decline in the KBW Bank Index <.BKX>.

(Reporting by Jonathan Stempel; Editing by John Wallace)