IMB reported a mild improvement in profit in the December 2010 half year, a period in which an increased willingness to lend to customers was offset by customer efforts to build savings.Net profit for the first half of the financial year increased 12 per cent, to $15.1 million, over the December 2009 half.The return on assets in the latest half-year was 0.63 per cent, annualised, for the half year, up from 0.57 per cent in 2009.The ROA for the Wollongong-based building society is thus slightly below the sector average of 0.7 per cent for the year ending September 2010, based on APRA data.IMB said it stabilised its average interest margin of 2.02 per cent.Michael Cole, chair of the board, wrote in an overview of the short-form financial statements published on Friday that IMB "expected that interest margins will continue to be stable over the next half year, but [this] will require constant focus as the competition for retail deposits keeps the cost of funds under pressure."Loan approvals increased nine per cent, to $419 million.However, growth in the stock of loans to members over the half, at two per cent over the last six months, was around half the growth in housing lending across all lenders.Deposits increased four per cent, to $3.5 billion, a rate of growth that also slightly lags that of the wider bank market.Cole wrote that IMB's liquidity levels were 31 per cent at the beginning of July 2010 and remained in excess of 30 per cent at the end of December.