Scale economies from its merger with Quay Credit Union and a refashioning of the costs of running its branch network helped G&C Mutual Bank lift net profit by 33 per cent to A$4.8 million over the year to June 2018, one of the heftiest profit increases in the mutual banking sector this year.G&C "is committed to exploring further merger opportunities with like-minded customer-owned banks" Dave Taylor, chief executive of the bank wrote in the annual report, released this week.The bank is one of the many mutual banks bolstering its receivables via a funding line for marketplace lender SocietyOne, though an APRA limit on large exposures has capped G&C's lending via that platform to around $20 million, little changed from last year.G&C has also recently become a funder for RateSetter.Total loans for G&C Mutual lifted by five per cent, with the bank also hemmed in by APRA caps on investment lending.Fewer than "two per cent of the bank's customers visit a branch to conduct their banking" the annual report noted."We've done a lot to lower the overheads without wholesale branch closures" Taylor told Banking Day."There is no discrete contact centre. Our contact centres are in our branches."These measures and the benefits of the Quay merger helped the bank lower its cost to income ratio drastically, to 69.5 per cent from 79 per cent a year earlier.Taylor appealed in the annual report for new regulatory requirements flowing from the financial services royal commission to be "squarely targeted at the major banks."