British bank Alliance & Leicester said its profit this year was set to beat a consensus analyst forecast as its revenue has nudged up while costs have fallen significantly.
Alliance & Leicester, Britain's seventh-biggest listed bank, said core 2005 operating profit was likely to be ahead of the current consensus forecast of £506 million (€747 million), and it was on track to achieve its return on equity target of 20 percent for the year.
The bank said full-year revenue was expected to be slightly higher than last year, signalling an improvement in recent months after flat revenue in the first half.
Operating costs would be "significantly below" last year with second-half costs similar to the first six months of the year, the bank said.
Alliance & Leicester is benefiting from customers increasingly using the Internet and telephone services rather than branches.
But the bank said its margins continued to decline in the third quarter in both retail and wholesale banking, and it expected its 2005 net interest margin to be around 10 basis points lower than in 2004.