HBOS has announced a 19 per cent rise in annual pre-tax profits, exceeding analysts' expectations.
The bank said that its pre-tax profits for 2006 climbed to £5.71 billion, up from £4.81 billion in the previous year.
Britain's fourth biggest bank, created following a merger between Halifax and the Bank of Scotland, said that lending was up ten per cent to £376.8 billion over the year, with customer deposits also up five per cent to £211.9 billion.
HBOS said that its gross share of the UK's mortgage market remained at 21 per cent, while its share of net lending increased from 14 per cent in 2005 to 17 per cent in 2006.
It also claims to have secured an estimated 11 per cent share of new credit card accounts and 19 per cent of new bank accounts, with the bank determined to grow the market shares of its main products by between 15 and 20 per cent over time.
Despite concerns about the impact of bad debt among lenders in the first half of 2006, HBOS said that the rate of growth of impaired unsecured loans "moderated" during the second half.
But the bank added that while the trend was "encouraging" it remained "cautious about future impairment trends given the continued growth in UK personal insolvencies".
HBOS said it would pay shareholders a full year dividend of 41.4p, a 15 per cent rise on last year.
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