By Juan Lagorio

NEW YORK (Reuters) - MasterCard Inc <MA.N> reported higher-than-expected quarterly earnings on Tuesday as the world's second-largest credit card network raised fees to banks and cut expenses, while consumers used their debit cards more.

"We began to see signs of stabilization in parts of our business," Chief Executive Robert Selander said in a statement.

MasterCard's third-quarter net income was $452 million, or $3.45 per share, compared with a loss of $194 million, or $1.48 per share, a year earlier.

Excluding special items, the credit card network posted earnings per share of $3.48, beating analysts' forecast of $2.94, according to Thomson Reuters I/B/E/S.

The company said special items for the third quarter of 2009 represented $6.2 million of litigation settlement charges. The special item for the third quarter of 2008 represented an $827.5 million net pre-tax charge related to an antitrust litigation settlement.

Revenue rose 2 percent to $1.4 billion, and also beat analysts' forecast, boosted by higher fees charged to banks and increased consumer use of credit and debit cards.

These factors were partially offset by the impact of slightly lower cross border volumes on third-quarter 2009 revenue, compared to the same period in 2008.

However, operating expenses declined 13 percent to $685 million, as the company trimmed advertising and marketing spending and reduced personnel and administrative costs. Continued...