UPDATE 2-Provident Financial Q4 profit misses Street

* Q4 EPS $0.12 vs est $0.17

* Provisions for loan losses rise 44 pct

* Net interest margin expands by 15 basis points

* Sees continued NIM expansion in Q1 2010

* Shares rise as much as 6 pct (Adds conference call details, analyst comment; updates share movement)

By Jochelle Mendonca

BANGALORE, Jan 29 (Reuters) - Financial holding company Provident Financial Services Inc (PFS.N) posted a quarterly profit that missed analysts' estimates on higher provisions, but expanded its margins, sending its shares up nearly 6 percent.

"Some of the credit quality problems that they presented have been entirely offset by the improvement in the margin and some nice loan growth," Boenning & Scattergood analyst Jason O'Donnell said by phone.

He said the margin expansion was more than expected and that it had positive implications for earnings going forward.

The net interest margin -- the difference between what the bank earns on loans and pays on deposits -- increased 15 basis points to 3.16 percent from 3.01 percent in the third quarter.

On a post-earnings conference call, the company said it expects continued margin expansion in the first quarter of 2010.

Provisions for loan losses rose nearly 44 percent to $12.2 million, while net charge-offs increased to $7.1 million from $4.1 million.

O'Donnell said he saw the level of provisioning "moderating" from current levels.

For the fourth quarter, the holding company for The Provident Bank earned $6.8 million, or 12 cents a share, compared with $7.4 million, or 13 cents a share, a year ago.

Analysts on average had expected the company to earn 17 cents a share, excluding special items, according to Thomson Reuters I/B/E/S.

Shares of the Jersey City, New Jersey-based company rose as much as 6 percent to $11.75, before shedding some gains to trade at $11.24 Friday late morning on the New York Stock Exchange. (Reporting by Jochelle Mendonca in Bangalore; Editing by Maju Samuel)