The overwhelming factor in the earnings improvement was a continued decline in the amount the bank set aside each quarter to cover expected loan losses. The second-quarter provision for credit losses was $146 million, down from $212 million in the first quarter, and $300 million during the second quarter of 2012. Net interest income declined to $1.242 billion in the second quarter, from $1.251 billion the previous quarter, and $1.306 billion a year earlier. The net interest margin narrowed to 3.25% in the second quarter, from 3.33% the previous quarter and 3.39% a year earlier. Second-quarter noninterest income was $858 million, declining only slightly from $863 million in the first quarter, but down sharply from $940 million during the second quarter of 2012. The year-over-year decline "was primarily driven by declines in mortgage-related income, trading income, and securities gains, which were partially offset by a reduction in the mortgage repurchase provision," according to the company. Large banks are seeing a considerable decline in mortgage application volume, as the major wave of home refinancing supported by the Home Affordable Refinance Program, or HARP, is coming to an end. Rising long-term interest rates have also lowered banks' gain-on-sale margins for newly originated mortgage loans. SunTrust CEO Bill Rogers said during the company's earnings conference call that "near-term mortgage revenue is likely to slow." KBW analyst Christopher Mutascio rates SunTrust "market perform," with a $35 price target, and estimates the company will earn $2.72 a share this year, with EPS increasing to $2.72 in 2014. "The vast majority of the company's estimated pre-tax income growth of 30% in 2013 and 5% in 2014 is driven by lower loan loss provision levels," the analyst wrote in a note on July 23. "This is not sustainable, in our view, and the sequential-quarter decrease in loan loss provisioning is likely to materially slow in the coming quarters." "The potential for stabilizing loan loss provisioning, coupled with some further modest net interest margin compression and weaker mortgage banking income, could result in the flattening out of quarterly EPS growth," Mutascio added. SunTrust's shares have returned 24% this year, following a return of 61.5% during 2012. The shares trade for 1.3 times their reported June 30 tangible book value of $26.08, and for 11.8 times the consensus 2014 EPS estimate of $2.96, among analysts polled by Thomson Reuters. The consensus 2015 EPS estimate is $3.29. STI data by YCharts Interested in more on SunTrust? See TheStreet Ratings' report card for this stock.