Suncorp Bank's investment in upgrading to advanced accreditation with the Australian Prudential Regulation Authority is already paying off, according to the bank, with a very low bad debt charge thanks to its investment in risk management.Suncorp Bank reported a net profit of A$194 million for the six months to December - up 10.2 per cent on the previous corresponding period. Net interest income rose 2.4 per cent to $566 million and operating expenses rose 1.2 per cent to $326 million.The bank reported a big drop in its bad debt charge, which fell from $43 million in the six months to December 2014 to $11 million in the latest half.The ratio of impairment losses to gross loans and advances is just four basis points.The net interest margin fell from 1.86 per cent in December 2014 to 1.83 per cent in June last tear and then rose to 1.85 per cent in the latest half.Suncorp is in the process of moving from a standardised approach for setting mortgage risk weights for regulatory capital purposes to an advanced approach, which will give it more discretion and lower its capital requirements.To make this transition it must convince APRA it has the right risk management systems.Suncorp chief executive Michael Cameron said the bank was effectively operating as an advanced bank already, despite not yet clearing all the regulatory hurdles.He said the investment the bank had made to achieve advanced accreditation was already giving it the capacity to make better risk and return selections, and better capital management decisions.The bank's housing loan portfolio grew 8.2 per cent to $43 billion, which was 1.1 times system growth.Consumer lending contracted by 14.4 per cent to $345 million and business lending contracted by 6.6 per cent to $9.5 billion.Housing finance accounts for about 80 per cent of the bank's total lending and it will remain around that level.Retail deposits made up 65.6 per cent of the bank's funding.Cameron said the bank would start operating on its new core banking system in the middle of the year. The bank expects to be able to deliver faster services and a better customer experience when the new system comes on line.