International Paper Co., the nation's largest paper manufacturer, yesterday reported sharply lower profits for the fourth quarter of 1976, which it attibuted to a geneal economic slowdown.

International Paper said ti earned $1.02 a share for the period, nearly 40 per cent below the $1.69 a share it earned for the same period of 1975. Profits for the period totalled $48 million, down from $75 million a year earlier.

For all of 1976, International Paper reported a 13.5 per cent rise to $5.60 a share from $4.93 in 1975. Last year's earning of $254 million were second only to 1974's profits, Chairman J. Stanford Smith said.

Smith said there were "encouraging signs of an acceleration in the rate of growth of the economy." and this "should be reflected in our business, especially since we believe that customers' inventories have been reduced and will need to be built ad demand increases in 1977."

In addition to a general economic slowdown in late 1976, the company blamed part of the drop in its fourth-quarter earnings to a 60-day suspension of operations at its Vicksburg, Miss. paper mill for major repairs, and higher costs for energy and some raw materials.

Smith also said that liquidation of inventories by customers late last year curtailed demand for packaging and business papers especially sensitive to changes in industrial activity.

He added that demand for consumer packaging, newsprint, coated publication paper (used in magazines) and other products remained strong throughout the year.

Mellon National Corp., parent firm of Mellon Bank, reported net income of $64 million ($6.54 a share) in 1976 compared with 1975 net income of $61.2 million ($6.25).

Board chairman James H. Higgins said income before securities transactions for 1976 was 13 cents a share higher than 1975 earnings. he attributed the increase to higher income from international sources and improved performances in non-banking subsidiaries.