A busy program of investment in customer facing systems will remain a priority for Newcastle Permanent Building Society, Australia's second largest mutual.While not the most profitable mutual ADI, Newcastle Permanent has the firepower to support the investment some may lack. In the 2015 annual report Newcastle Permanent brag of a "tier one capital ratio [that] stands at 19.5 per cent, which is significantly above regulatory requirements and that of all banks and other significant customer-owned banking institutions."Among recent priority projects listed by chief executive Terry Millet are upgrades to mobile and digital banking functionality, its website and home loan systems.Indian financial infotech giant Infosys is the supplier on the digital banking project, though NPBS will continue to rely on an internally developed core banking platform.Newcastle Permanent posted a net profit of A$36.5 million over the year to June 2015, a tiny increase on 2014. With a return on average net assets of around four per cent and a return on assets of 0.4 per cent, NPBS is producing earnings in line with the credit union sector average but a little below par for the much smaller group of peer building societies.A heavy churn in its home loan book is one dynamic for the building society to manage. Its core home loan book increased by four per cent over the year, a rate of growth held back by borrowers' determination to get ahead."Like much of the industry, our customers are significantly in advance, over 90 per cent of home customers are in advance of their obligations. We see this as a good thing."Millett summed up a couple of financial management themes."We are not one of those organisations that operates with 20 per cent to 30 per cent liquidity; we run at about 15 per cent to 16 per cent.""We effectively generate profit to maintain capital levels [which] enables us to maintain long term credit ratings. We then use our pricing to mutually share the benefit back to customers."Asked if any mergers were on the radar, Millett said "we view any approaches to us in the best interest of our members. We don't consider if it's in the best interest of the firm that wants to come and merge with us.""We tend to get at least one or two a year; lots of small organisations down around the one billion dollar asset mark. Many are sub-scale and I assume many want to try to find a way through."Our priority is strong, organic growth in our target market in New South Wales and to be the best retail banking organisation in the country."