We study the statistical properties of a three-level laser where cascade coherent excitation as a two-step process is used as a coherent pump and a laser field is generated on the upper transition. It is shown that the laser intensity fluctuations are suppressed up to 50% below the shot noise limit and that the laser linewidth is reduced below the Schawlow-Townes formula by more than one order of magnitude of the laser intensity. By transforming to the picture dressed by the coherent field on the upper transition, we identify a transfer of the lower coherent excitation to be responsible for th...