* H1 net down 48 pct to 214.7 mln euros vs f'cast 180.5 mln
* Q2 net profit up 50.4 percent q/q to 129 million euros
* H1 net interest income down 5.9 percent to 844.9 mln euros (Adds CFO and analyst comments, details)
By George Georgiopoulos
ATHENS, Aug 25 (Reuters) - Alpha Bank, Greece's third largest lender, on Tuesday reported better-than-expected first-half and second-quarter earnings, helped by asset repricing, cost containment and cheaper funding.
Kicking off the Greek banks' earnings season, Alpha reported a 48.2 percent drop in first-half net profit to 214.7 million euros ($307 million) as loan growth slowed and provisions rose.
Analysts polled by Reuters had forecast 180.5 million euros in profit on average, with estimates ranging from 172 million to 186 million.
Quarter-on-quarter the bank's earnings jumped 50.4 percent to 129 million euros, also above consensus.
"Results were better than forecast on improved net interest income in the second quarter," said analyst Nikos Gallousis at Kappa Securities. "We expect improving performance in the coming quarters."
Net interest income rose 10 percent quarter-on-quarter to 442.3 million euros in the three months to June as the net interest margin widened to 2.5 from 2.4 percent. Net interest income in the first half was down 5.9 percent to 844.9 million.
An economic downturn at home and in the Balkans, where Greek banks have expanded, weighed on Alpha's volumes in the first half, while a battle to attract deposits in Greece during the first quarter pressured net interest margins.
Competition for deposits eased in the second quarter with cheap liquidity provided by the European Central Bank taking some pressure off net interest margins. Rebounding equity markets boosted trading gains.
"We had a robust financial performance in the second quarter and our main focus was the strength of our balance sheet," CFO Marinos Yannopoulos told Reuters. "Strong capital generation raised our core Tier capital to 7 percent with our Tier 1 ratio reaching 9.7 percent, high ratios by any standards."
Alpha said asset quality deteriorated compared with the previous two quarters, with non-performing loans (NPLs) rising by an anticipated 50 basis points to 4.8 percent. Its loan book had a limited exposure to consumer loans and the Balkan markets -- 11.6 and 12.6 percent of the total respectively.
The bank said it had an adequate profitability buffer to accommodate impairments. Adding collateral to accumulated provisions of 1.4 billion euros, its NPL coverage ratio was 135 percent.
Alpha shares are up 63.5 percent year to date, outperforming the Greek stock market's 39 percent advance. They trade about 15 times 2009 estimated earnings versus a multiple of 17 for European peers. (Additional reporting by Lefteris Papadimas; Editing by David Holmes)