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Financial services group Alliance & Leicester (A&L) has reported a 12.8 per cent increase in annual pre-tax profits.

The UK's seventh largest bank reported an increase in pre-tax profits from £257 million pounds last July to £290 million on the back of growth in its commercial and retail banking divisions.

It also reported a 39 per cent increase in profit in its commercial banking division to £96 million and a 3.7 per cent increase in retail banking profits to £219 million.

A spokesperson for the company added that 170,000 new current accounts had been opened this year and personal customer deposit balances had increased by £0.6 billion to £23.3 billion. He added that a 29 per cent increase had been reported in the number of corporate accounts opened.

The group also reported improvements in its cost efficiency ratio with a three per cent decease to 51.8 per cent in its ratio of costs to incomes.

Commenting on the results, chief executive Richard Pym said: "A&L has delivered a very good set of results, with good revenue growth, lower costs and strong asset quality.

"A&L is very well positioned for the future, it has a business model which meets the changing needs of consumers and a strong management team," he added.

Finance director David Bennet will soon take over as the group's new chief executive. Richard Pym had announced that he would step down as the group's chief executive after five years, in February 2007.