IMB Ltd was not able to make any headway in what it describes as a "challenging business environment" during the 2012/13 financial year. The building society's loan book shrank, its interest revenue fell and its net profit was down more than five per cent.Remarkably, it was only able to write $566 million of new residential loans. As a consequence, its loan portfolio fell from $3.78 billion, in 2012, to $3.72 billion at the end of June.Net interest income fell from $93.2 million to $91.6 million. At the same time, fee and commission income rose $12.5 million, to $13.4 million.While revenue was down, costs were up. Operating expenses rose from $63.5 million to $64.5 million. Net profits fell from $30.1 million to $28.5 million. The 2012/13 earnings figure was bolstered by $4.6 million of revenue from a land sale, which might be considered a one-off.IMB's return on equity fell from 12.7 per cent to 12 per cent. And its net interest margin fell from 1.99 per cent to 1.97 per cent.Highlights were a reduction in the bad debt charge and a 60 basis point increase in the capital adequacy ratio, which is now 16.4 per cent.