Banking group HBOS said this morning it was on course to meet its key annual targets after reporting a healthy start to its financial year.
The group, which was formed following last September's merger of Halifax and Bank of Scotland, added trading had been in line with expectations.
Like other lenders, HBOS saw an increase in bad debt provisions but added that this was due to higher volumes rather than poor credit quality.
It has been buoyed by strong sales of new mortgages as lending volumes and the retention of existing customers keep the group on course to exceed its target of a 25 per cent share of all net mortgage lending.
HBOS is also set to meet its dual aim of 20% market share in the recruitment of new credit card and current account customers.
The expansion of the group's business banking division from its traditional stronghold of Scotland has also made progress, HBOS added.
It is expected to benefit from the Competition Commission's recent attempt to open up the market in services to small and medium-sized enterprises. HBOS said today: "Business banking has made good progress in the first half of the year.
"By the half-year stage we expect that the attack on the established competitors in England and Wales will see new account openings significantly ahead of last year."