The combination of margin pressure from falling interest rates and increased investment in member services resulted in a 7.9 per cent fall in CUA Group's net profit for the six months to December.
Profit from the group's banking operation was down 23.4 per cent to A$23 million.
However, CUA Health increased its profit from $2.4 million in the December half 2018 to $5.1 million in the latest half.
Group net profit was $21.2 million - down 7.9 per cent from the previous corresponding period.
CUA originated $1.5 billion of loans during the December half. This was down from $2.3 billion it originated in the previous corresponding period, but it was 1.3 times system.
Total assets grew 1.7 per cent to $16 billion. Deposits made up 72 per cent of funding.
Member numbers across banking and insurance grew by 2.1 per cent to 561,000.
CUA chief executive Paul Lewis, who has been in the job since November, said the group was committed to spend around $40 million this year "on projects that will accelerate member experience improvements and help the business to scale, including a streamlined lending origination system".
It is working with Sandstone Technology on the new loan origination system.
Lewis said that despite the impact of higher costs on earnings, CUA was committed to its investment in projects that would position the organisation for the future.
Last September, CUA launched a new transaction account, Everyday Snap, targeted at younger members. The new product contributed to 9.1 per cent growth in transaction account balances during the half.
Lewis said: "We have made a decision to strengthen our focus on transaction banking. Millennials account for 63 per cent of the Snap accounts opened.
"CUA's marketing has traditionally focused on our home loan offering, so this has been a strategic shift."
It has also expanded its iM messaging app, a chat function where members are allocated to a designated personal banker for all interactions. The app has around 30,000 users serviced by 26 bankers.