UPDATE 1-Washington Federal Q1 profit drops 61 pct

* Q1 EPS $0.07 vs $0.23

* Q1 hurt by higher credit costs

* Provision for loan losses doubles

* Loss on real estate acquired through foreclosure higher

Jan 19 (Reuters) - Washington Federal Inc WFSL.O posted a 61 percent drop in quarterly profit, hurt by a jump in provision for loan losses and real estate owned (REO) expenses.

The savings and loan holding company's net income available to common shareholders was $7.9 million, or 7 cents a share, for the first quarter ended Dec. 31, compared with $20.2 million, or 23 cents a share, a year ago.

Analysts on an average expected the company to earn 12 cents a share, excluding items, according to Thomson Reuters I/B/E/S.

Provision for loan losses was $69.8 million for the quarter, compared with $35 million in the year-ago quarter.

The loss on real estate acquired through foreclosure stood at $12.7 million, up from with $1.2 million last year.

Washington Federal, the parent of Washington Federal Savings, provides residential real estate loans, commercial real estate financing, consumer deposit accounts and business banking.

Shares of the Seattle-based company closed $20.50 Friday on Nasdaq. (Reporting by Archana Shankar in Bangalore; Editing by Mike Miller)