In a quarter where most banks increased their reliance on short-term funding to lower their interest expense, TSB Bank in New Zealand stuck to customer deposits as its only form of financing.In fact, in the December 2009 quarter, the bank converted some its on-call deposits to term deposits while increasing its total deposits, and yet managed to maintain its net interest income. The bank recorded net interest income of NZ$28 million, compared with NZ$28.1 million in the preceding September 2009 quarter.Total deposits rose to NZ$4.0 billion, up eight per cent from the September 2009 quarter. Of this, term deposits rose to NZ$2.6 billion from NZ$1.8 billion, while at call deposits fell to NZ$1.2 billion from NZ$1.8 billion.This is the first time in the recent past when the bank's term deposits doubled the call deposits. In the past call deposits closely tracked term.Loans grew to NZ$2.3 billion, up three per cent from NZ$2.3 billion in September. Pre-tax profit, however, fell 14 per cent to NZ$17.6 million due mainly to an increase in provision for impairments which rose to NZ$1.3 million from NZ$0.9 million in the previous quarter. TSB has the lowest level of impaired assets among all the NZ banks at about 0.1 per cent of total assets.