* Net profit 60.9 million euros vs forecast of 48 million
* Foreign operations account for nearly all profit
* Domestic side fell as financing conditions worsened
* Net interest income up 7 percent
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LISBON, May 2 (Reuters) - Portugal's No.2 listed bank Banco Espirito Santo on Monday posted a 49 percent fall in first-quarter net profit, providing further evidence of the impact of the country's debt crisis on the banking sector.
The profit fall was partly due to the sale of the bank's syndicated loan portfolio at a discount.
BES sold more than 1.3 billion euros of syndicated project finance and corporate loans in the first quarter at a discount estimated at around 3-4 percent.
It said the costs of the deleveraging process amounted to a net 35 million euros, while a new levy on the banking sector -- part of the government's efforts to reduce its budget deficit -- brought an additional cost of 7.6 million euros.
"The group's performance in the quarter was conditioned by the deterioration of Portugal's financing conditions after successive credit rating downgrades of government debt followed by downgrades of the banking system," BES said in a statement.
Portuguese banks have suffered during the euro zone debt crisis. They have been shut out of interbank loan markets and forced to rely on European Central Bank loans for liquidity. Portugal last month requested a bailout estimated at 80 billion euros.
The bank said in a statement net profit fell to 60.9 million euros ($90.18 million) -- most of it, or 56 million euros, coming from the bank's overseas activities in countries like Angola, Brazil, Mozambique and the United Kingdom.
Still, overall net interest income rose 7 percent from a year earlier, to 271.3 million euros.
Analysts surveyed by Reuters had predicted, on average, a net profit of 48 million euros and net interest income of 270 million euros.
Last week, the country's largest listed bank Millennium bcp reported a 19 percent fall in the quarterly profit due to weaker trading gains and higher bad debts.
BES shares had closed 0.7 percent higher at 2.87 euros on Monday before the results were announced, largely in line with the broader market in Lisbon.
(Reporting by Sergio Goncalves and Andrei Khalip. Editing by Jane Merriman)