UPDATE 2-NewAlliance Q1 profit beats Wall Street view

(Adds analyst comment, details)

By Ratul Ray Chaudhuri

BANGALORE, April 29 (Reuters) - NewAlliance Bancshares Inc (NAL.N: Quote, Profile, Research) reported a 39 percent rise in first-quarter earnings, beating Wall Street estimates by a cent, helped by higher interest income and a rise in brokerage and other fees.

"This was a solid quarter for NewAlliance. Margin improved and credit costs were relatively stable," Sterne Agee Group analyst Matthew Kelley said by phone.

The holding company for NewAlliance Bank reported net income of $12.9 million, or 13 cents a share, compared with $9.3 million, or 9 cents a share, a year earlier.

Analysts on average expected the New Haven, Connecticut-based company to earn 12 cents a share, before special items, according to Reuters Estimates.

Net interest income rose 6 percent to $46.0 million, while non-interest income rose 10.6 percent to $15.7 million.

Investment management, brokerage and insurance fees rose 47 percent to $2.5 million.

MARGIN EXPANSION