A large increase in lending in the second half of last year helped the Bradford & Bingley's pre-tax profits to rise by 11 per cent to £310.1 million last year.

Record buy-to-let lending levels and effective cost cutting measures were among the reasons the mortgage lender gave for its strong showing in its final results released today.

And the business, which has its main offices in Crossflatts and Bingley, believes the record lending of late last year is likely to continue into 2006.

The lender described the housing market as "buoyant" today after unveiling the annual profits which at the top end of expectations.

B&B's main specialist markets, including buy-to-let, recovered from a sluggish first half to reach a much higher level than the rest of the market during the second half of the year.

The company attributed the over-performance to strong social, economic and demographic factors.

Steven Crawshaw, group chief executive, said: "Bradford & Bingley has had a very strong successful year and we have made a strong start to 2006.

"Our business is stronger, leaner and better able to convert growth into profit.

"The momentum of record lending volumes in the second half of 2005 has continued with a strong pipeline as we enter 2006.

"The mortgage market is robust and we see good prospects for our chosen specialist segments, which positions us well for future growth."

The strong results were aided by slashes on operating costs, which were reduced by £264.8 million.

These costs are expected to remain under tight control as B&B prepares for further expansion in 2006.

After a slow down in the housing and mortgage sectors in the first half of 2005, the buy-to-let specialist said in a trading statement that it had seen a "significant improvement" in lending completion over the past six months

In early January the firm announced that their finance director Rosemary Thorne, was leaving to take up a post with bookmaking firm Ladbrokes.

She has been replaced by Chris Willford.

The business, which has about 300 branches in the UK, underwent a cost reduction programme last year and reported a "step change" in efficiency.