Judo Bank released some headline numbers for the December half-year yesterday, ahead of the report of its interim financial results next month, as well as a forecast that its net interest margin will fall below 3 per cent in the June half. When Judo presented its 2022/23 results last year, chief executive Joseph Healy said he was confident the bank could maintain a NIM above 3 per cent. NIM was 3.29 per cent in the year to June 2022 and 3.02 per cent in the six months to December. Judo said the lower NIM was the results of its Term Funding Facility repayment strategy and higher liquid holdings during the half. It expects NIM to fall to 2.7 to 2.8 per cent in the June half, which will be “trough NIM”. “Improvements thereafter will be driven by the bank’s liquidity levels normalising, improving ending margins and a higher proportion of funding from lower-cost term deposits,” the bank said. Total income for the half was A$200 million – an increase of 6.4 per cent half-on-half. Pre-tax profit rose 24 per cent half-on-half to $67 million. The impairment expense fell from $32 million in the June half last year to $27 million in the December half. Gross loans and acceptances rose 9 per cent from $8.9 billion at the end of June last year to $9.7 billion at the end of December. Judo said its lending growth over the half was three times system business credit growth. The average gross lending margin was 464 basis points in the December quarter, compared with 398 bps in the September quarter and 390 bps in the June quarter. “The increase in lending margins reflects Judo’s disciplined approach to pricing for risk and sustainable growth.”