ANZ NZ has reported a 14 per cent rise in cash profit for the nine months to June 30, further embedding its profitability in the wake of last October's integration of its National bank brand and computer system.But the stronger profit was mostly driven by a nine per cent drop in costs, while its net interest income fell four per cent. This contrasted with an improvement in net interest income reported last week by its main Auckland rival ASB.ANZ reported its term deposits at June 30 were NZ$33.6 billion, which was up 3.5 per cent from a year ago, but down one per cent from September 30, 2012 as it lost some retail deposits to other banks. ANZ adopted National's computer system in New Zealand and dropped the National Brand on the weekend of October 27/28.  However, other interest bearing deposits rose 12.5 per cent to NZ$29.1 billion between September 30 and June 30. ANZ did not break out the source of its net interest margin contraction, but noted in a release with its June quarter disclosure statement that it had happened earlier in the financial year. The National Bank integration triggered an intense period of competition for mortgage market share in Auckland as ANZ ramped up activity to defend ANZ and National customers from an anticipated attack from its rivals. This drove fixed mortgage rates and their margins lower.Competition for high loan to value ratio mortgages has however eased in recent months after the Reserve Bank signalled 'speed limits' to slow the growth that surged around the time of the ANZ integration with National. ANZ said in its group trading update its New Zealand division had made a smooth transition to its one brand and its customer numbers were holding steady."While the revenue environment remains quite subdued the simplification program is delivering ongoing scale and productivity benefits," ANZ said. "Margins have stabilised and credit quality trends remain benign," it said.