Halifax's mortgage lending increased 18 per cent to a record £14.2bn in 1998.
It says its net mortgage lending in the second half of 1998 accounted for 11 per cent of the market and 5 per cent for the year as a whole.
It took £7bn in savings which it estimates to be 12 per cent of all savings accounts opened in the year.
Pre tax profits grew by 33 per cent to £541m and earnings per share increased by 9 per cent to 47.5p.
The total dividend increased by 16 per cent with a proposed final dividend of 13.5p per share to be paid on May 10 1999.
Clerical Medical's income from regular and single premiums grew 33 per cent to £238m. The company also won a pension scheme with 20,000 contributions.
Halifax will also undergo a corporate restructuring in a bid to return £1.5bn to its 3.6m ordinary shareholders.
Shareholders can expect a return of £217 in early June for exchanging their shares in Halifax plc for shares in a new holding company.
Chief executive James Crosby says: "These results confirm our position as the market leader whilst underlying the exceptional progress we are making in our new business."