One of Australia’s largest banks said bad loans among its customers fell further, even before an expected cut to borrowing costs by the central bank on Tuesday.

The bank said its quarterly net profit of $1.7 billion was lower due to some notable items, while its profit margin also contracted due to competition.

Westpac Banking Corp, Australias second-largest mortgage lender, posted a first-quarter net profit of A$1.7 billion ($1.08 billion) for the three months ended December 31, up from A$1.5 billion a year earlier.