Profit before tax at TSB jumped 153 per cent in the first quarter of 2015 compared to the last quarter of 2014, to £34.2m.
That said, on the same quarter last year, profits fell 27 per cent – down from £47m. That reflected higher costs, partially offset by continued improvement in impairment losses, the bank said.
The challenger bank, which was spun out of Lloyds continued to grab account switchers. 7.9 per cent of all those who switched account in the quarter went to TSB, above the bank's six per cent target for the fifth consecutive quarter.
It's new mortgage brokering service launched at the start of the year received £700m of gross mortgage applications by the end of the quarter.
Why it's interesting
From being hived off from Lloyds and floating last year, the self-styled challenger bank has been pleasing investors with profits.
No wonder then that Banco de Sabadell made a £1.7bn takeover offer which sent shares rocketing 27 per cent.
What TSB said
TSB is starting to fire on all cylinders as we take on the big banks in our mission to bring more competition to UK banking.
Over 7.9 per cent of people opening or switching a bank account in the last quarter chose TSB – meaning we've now had five quarters in a row where we've beaten our 6 per cent target; our mortgage broker service has continued its flying start, having received over £700 million of applications by the end of March, and more customers than ever before are recommending TSB to friends and family.
Whilst we still have a long way to go in bringing better banking to UK consumers, we're making real progress. This is reinforced by Banco de Sabadell's recommended offer to acquire TSB, which is a real vote of confidence in everything we've achieved so far and in our potential to succeed further in the future.
TSB is pulling in profit and chief executive Paul Pester continues to make headway into the retail banking space.