Around £10 billion in new business and mortgage lending has been pledged to the Clydesdale and Yorkshire bank over the next two years.

The banks' owner, National Australia Bank, said despite pre-tax profits falling by 68% to £108 million to the end of September, the UK arm was "moving up a gear".

Lynne Peacock, chief executive, said the business was in a strong position to take advantage of any growth opportunities.

Figures showed that the bank advanced £4.1 billion of new lending in the year, and that bad and doubtful debt charges were up by £236 million to £421 million, due to the difficult economic climate.

Ms Peacock said the promise of £10 billion in new lending was a "considerable commitment for a business of our size".

Clydesdale and Yorkshire said the banks' prudent approach to lending meant that the proportion of mortgages more than three months in arrears was less than a third of the UK average, at 0.8%.

The business, which did not offer controversial sub-prime or self-certified mortgages, said that both banks had a "clear and enduring commitment" to support customers during the recession.

Of the £4.1 billion in new lending in the year, National Australia said £2 billion was new business and £1.8 billion was new mortgage lending.

Average gross loans and acceptances were up £2.1 billion in the year, or 7%.

Ms Peacock said: "We've kept our business safe, secure and in the best possible shape by maintaining a strong capital position and supporting our customers in these challenging times. We're now moving up a gear.

"We will continue to avoid the excesses of the sector and will maintain our careful strategic approach."

National Australia has 2.7 million UK customers - up 2% over the year - through Glasgow-based Clydesdale Bank, which incorporates the Yorkshire Bank brand.

The business has a total of 340 branches, consisting of 188 Yorkshire Bank and 152 Clydesdale sites.

It employs more than 8,200 full time workers in the UK, with 2,400 in its Glasgow and Clydebank operations and 1,900 in Yorkshire.

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