Halifax Bank of Scotland has posted lower than expected annual profits and warned of continued uncertainty in financial markets this year.
Underlying pre-tax profits came in 3% higher at £5.71 billion for 2007 - but below City forecasts of £5.76 billion.
The bank captured 22% of new mortgages in the second half of last year but said it would put profitability ahead of market share in future.
HBOS said: "We are planning on the assumptions that market conditions will remain uncertain throughout 2008."
Headline pre-tax profits fell 4% to £5.47 billion, reflecting factors such as costs related to possible refunds of overdraft fees to customers - currently the subject of a test case brought by the Office of Fair Trading.
Despite the lower than expected profits and the financial turmoil which shook markets in the latter half of last year, HBOS also looked to offer reassurance over its funding position.
The company said the supply of wholesale funding to the bank "remained strong", while customer deposits increased 15% to £243.2 billion.
