Like clockwork, Wachovia (NYSE:WB) beat the mean analyst estimate by a couple pennies yet again. It's also no surprise that the company made further acquisitions this quarter as part of its ongoing growth strategy.

Past deals like the recent SouthTrust purchase boosted third-quarter results. Revenue rose 19% in the quarter, and net income grew 32%. On a per-share basis, though, significant dilution reduced growth to just 9% (after stripping out merger-related charges).

Continuing a trend, net interest margin dropped, and the efficiency ratio improved. Although the interest margin drop was about 16 basis points on a year-over-year basis, it was a more modest 3 basis points sequentially. Still, net interest income grew 15% during the quarter. And even though return on equity slipped more than a full point, return on assets actually improved a bit.

While Wachovia owes much of its 36% growth in average loan balances to the SouthTrust buy, underlying lending trends are still positive in their own right. Ditto for deposits, where the average balance climbed 20% from last year. The company has maintained sterling asset quality with both non-performing assets and allowance for losses improved on a year-over-year basis. However, investors shouldn't expect a lot more improvement here. These excellent levels of credit quality will be tough for the bank to maintain, much less improve.

I'd strongly encourage any interested investors to read the earnings release for themselves, but I'll give a few more general thoughts here. First, Wachovia's strong fee and service charge performance continues. Second, the company doesn't appear to be seeing the same sort of disruptions from bankruptcies as Citigroup (NYSE:C) reported today. (Then again, Wachovia doesn't have Citigroup's huge credit card business, either.) Finally, I would expect to see the company continue pursuing acquisitions in its strategy to buy assets and growth.

Wachovia has quickly made itself a major player through savvy management and opportunistic deals. It's even getting into the Asian banking game. I'm not thrilled that Wachovia's interest margin, return on assets, and return on equity are a bit low, but growth is still solid. Trading at a discount to many other large banks, Wachovia could do well in the long term, though it's possible that short-term worries about interest rates and the economy will keep these shares down a little longer.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).