News: CBA UPDATE 1-Australia's Commonwealth Bank profit beats estimate on higher lending, cost...

(Adds details on results, background)

May 12 (Reuters) - Commonwealth Bank of Australia (CBA) on Thursday beat an estimate for third-quarter cash earnings as solid growth in lending and lower costs at the country's biggest bank more than offset margin pressure from intense competition.

The results mark the end of Australian banks' latest earnings cycle that saw lower margins across the board, although much of that squeeze is expected to ease in the coming year as interest rates rise.

"Continued growth in household deposits, home loans, business lending and business deposits was a feature of the quarter," Chief Executive Officer Matt Comyn said.

CBA said cash net profit after tax from continuing operations was about A$2.40 billion ($1.66 billion) for the quarter to March, in line with year-earlier figures but higher than a Barrenjoey estimate of A$2.15 billion.

CBA did not disclose a net interest margin figure, but said it was under pressure during the quarter. It, however, booked a credit impairment benefit of A$48 million due to improving economic conditions in the country.

Its quarterly home lending balance grew by A$6.9 billion from December-end, CBA said.

($1 = 1.4415 Australian dollars)