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The crisis occurred despite rising mortgage rates, as gains from the "overhaul" of mortgage rates were more than offset by banks offering large discounts to new customers, along with higher financing costs .
With credit growth also slowing, general manager Marnie Baker said the bank was expecting a tough second half, which should offset some of the slowdown by cutting costs.
"I think it will be as difficult in the second half as in the last game," said Baker.
"I think there is pressure, it's a lower credit growth environment and a lower income growth environment. We are always very focused on costs, especially in this type of environment, to make sure we reduce costs. "
In response to the Hayne Royal Commission's report, Baker said the government could take steps to increase competition, which would "complement" the commission's recommendations to combat misconduct in the industry.
Bendigo had stated that the royal commission could be an opportunity for the bank and Ms. Baker said the clients had abandoned the big banks after the royal commission, but that there was still an "apathy" about the change of bank.
Bell Potter badyst TS Lim said it had been a "hard half" for Bendigo as it predicts a "series of earnings cuts" in the bank's earnings forecasts.
"Sales growth has been weak, margins have decreased and volumes have decreased," Lim said.
Bendigo will pay an interim dividend of 35 ¢ per share, which will be fully stamped and paid on March 29.
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