Wilshire Bancorp Inc. on Tuesday said that its third quarter net income rose 3 percent because it slashed its non-performing loans and became more selective about borrowers and terms.

The Los Angeles bank holding company, parent of Wilshire State Bank, reported net income of $6.9 million (23 cents per diluted share) in the quarter ended Sept. 30, compared with $6.6 million (23 cents) in the same period a year ago.

Average interest-earning assets increased 15 percent from a year ago to $2.22 billion. Gross loan charge-offs dropped 39 percent from a year ago to $1.5 million. Total nonperforming loans decreased 17 percent from the second quarter to $13.7 million. Wilshire did not engage in subprime lending and its portfolio does not contain any such loans, it said.

“We have been able to maintain a strong capital position, allowing us to take advantage of sound lending opportunities and grow our loan portfolio while being more selective as to whom we lend to and on the lending terms,” Chief Executive Joanne Kim said in a statement. “With fewer lenders competing in our market, we have been able to effectively manage loan pricing.”

Wilshire shares closed down 13 cents, or 1 percent, to $11.45 on the Nasdaq.