Australia's largest credit union, Credit Union Australia, has reported a half-year group net profit after tax of A$31.1 million, up 10.9 per cent on its previous first-half result. The result was underpinned by continued member growth, an increase in net interest income and a positive result for its previously troubled subsidiary, CUA Health.CUA Health contributed NPAT of $3.37 million for 1H2017. This represented a minor turnaround helping to offset a slightly weaker result for the banking business, which was impacted by aggressive market competition over the period and continued pressure on margins.The lower banking profits notwithstanding, CUA's major core banking upgrade and its focus on getting full value from its mobile and digital banking services has been paying off."CUA has rolled out Android Pay and Apple Pay to our members, and we are one of only two financial institutions in Australia offering Apple Pay for Mastercard holders. We've introduced the ability for people to open a transaction account and become a CUA member online in just minutes," chief executive Rob Goudswaard said, while noting that this remained a fraught area."We're currently redesigning our mobile banking app, ahead of a launch later this year. And we are committed to being one of the first financial institutions in Australia to deliver members the benefit of real-time payments using the New Payments Platform when it launches towards the end of 2017," Goudswaard said.The number of members using mobile banking has increased by 22 per cent compared to a year ago, with more than 105,000 members logging in each month. Across both mobile and online banking, CUA had over 175,000 active users, he said. CUA Health premium revenue for the six months was $72.1 million, while the insurer returned $61.9 million in benefits to policy holders. Over the past year, policy holders received around 88 cents in the dollar in benefits, higher than the industry average of 86 cents.Another subsidiary, Credicorp Insurance, posted a half-year NPAT of $577,000, an increase of 20 per cent compared to the FY16 first-half result. This subsidiary now provides general insurance to more than 13,500 members. Discussing CUA's outlook for the rest of the year, Goudswaard said an increase in new lending and sales in recent months should contribute to a positive second-half financial performance. "What we do this half and how it flows into the second half [of the 2017 calendar year] will be much more challenging," Goudswaard said.  "Loans are flying through at the moment because we haven't raised our interest rates - but at the same time cost of funds have gone up, meaning that margins will be compressed more in the second half, that is from January to June 2017, relative to what we experienced in the first half last year."Nonetheless CUA's house view is for pressure on margins to continue for the remainder of FY17, given the current low interest rate environment and steepening yield curve - which has pushed up funding costs - and strong competition in both the home loans market and in