After several decades of trying to secure a foothold in the Australian financial services market, ME Bank appears to have settled on a winning formula.The bank yesterday unveiled a record first half profit of A$46.4 million on the back of cost reductions and better-than-system growth in mortgages, personal loans and retail deposits.The improvement in the interim bottom line equates to a 58 per cent rise on the previous corresponding period.While heightened price competition in the home loan market is expected to put pressure on the company's net interest margin in the current half, the bank might still be on track to record its maiden nine-digit full year profit when it balances its books at the end of June. The momentum apparent in the business is underlined by the fact that the latest six-month return exceeds the full year bottom line posted in 2014.Managing director Jamie McPhee said consistency was the most important feature of the bank's improving performance in the last five years. "We're growing deposits at 3.6 times system and mortgages at 1.6 times the average for other banks," he said."We want to continue that type of growth."ME's heavy reliance on securitisation as its main source of funding before the global financial crisis hit in 2008 forced the bank to chart a new strategic course focused on the deposits market.Winning the loyalty of retail depositors has been a challenging experience for the organisation.  Although the bank struggled a decade ago to attract deposits from retail customers, in the last six years it has trebled its household deposit base to $7 billion according to APRA data.The consistency of that growth is the most tangible evidence that consumers now view the ME brand as a viable transaction banking option."This is not hot money," said McPhee."We retain around eighty per cent of the deposits that come into the bank because that's what we want to be - the main financial institution for our customers."Another key driver of ME"s sustained bottom line growth in the last five years has been the downward trend in operating costs.Ten years ago the bank was sitting on a sector-leading cost-to-income ratio of more than 80 per cent.Big-ticket investments in new technology and scalable banking platforms have driven the efficiency measure down to 61 per cent."Our cost-to-income ratio is still not where our peer group is - Bendigo for example is in the mid-50s," said McPhee."But we believe it will continue to fall further as we increase lending volumes and reap the productivity gains from our new technology platforms."ME is now operating on a Temenos T24 banking platform, which has enabled the bank to embed straight-through processing across the organisation.The latest half year results show that McPhee is within sight of one of the most sensitive performance targets set for him by the ME board when he took the management reins eight years ago - a 10 per cent return on equity.ME's first half earnings equated to a ROE of 8.9 per cent.The most important aspect of this