After purchasing $1.3 billion of its own shares during the third quarter to boost its share price and offset dilution of internal stock awards, Merrill Lynch & Co. continues to actively buy back shares.

“We are still buying at an active pace,” Merrill’s chairman and chief executive, Stanley O’Neal, said at the firm’s banking and financial-services conference yesterday.

Merrill repurchased 18.3 million shares during the third quarter and about $6.3 billion of shares in the first nine months. On September 30, it had $1 billion of repurchase capacity out of a $6 billion program authorized by the firm’s board in February. The board authorized another $5 billion for buybacks last month.

Merrill’s earnings in the first nine months increased 38% to $5.15 billion, and more than doubled in the third quarter to $3 billion from $1.4 billion in 2005. The total included strong fixed-income and equity-trading results, as well as a one-time gain of $1.1 billion from merging Merrill’s investment-management business with BlackRock Inc.

Mr. O’Neal also said the company’s dividend payment remains an”integral par” of its capital management program. Merrill has raised its dividend 25% in each of the past two years.

Merrill’s first priority in spending excess capital, however, is redeploying it into its business.

“That is the most clear-cut and best path to grow shareholder value,” Mr. O’Neal said.

Merrill’s overseas businesses are growing at a rapid pace. Its non-American revenue in the first nine months of the year was 37% of the firm’s global total revenue, an all-time high. Merrill expects its global trading and banking revenue in Europe and Asia to double by 2008, he said.

The firm’s burgeoning commodities business, after Merrill acquired electricity and coal trading firm Entergy-Koch for $800 million in late 2004, also is growing overseas, he said.

The commodities businesses’ pretax margin is nearly double the trading division’s as a whole, and Merrill is building in the Pacific Rim, as well as expanding into product areas such as oil and metals trading, Mr. O’Neal said.

Merrill, the biggest retail broker with more than 15,000 financial advisors, is expanding into selling banking products and would like to develop a “stronger online transaction capability” for clients and to improve its cash management services for small business, Mr. O’Neal said.

Merrill, which has been buying mortgage lending firms and is periodically rumored to be interested in buying a commercial bank, has about $70 billion of deposits in a small bank it does own.