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HBoS' marketshare was 20 per cent as of the 31 December 2006, according to the Council of Mortgage Lenders (CML).

In its first half results for 2008 Abbey, which is owned by Santander, said its share performance was in part impacted by the withdrawal of other providers from the market with a lower share expected in the remaining part of the year.

Mortgage balances were up 13 per cent compared with the same period in 2007, while volumes of new business were considerably higher than a year ago, the lender said.

Deposit flows were well ahead of the first half in 2007, up more than 50 per cent, and in the second quarter of 2008 were more than double the first quarter.

The results also showed Abbey had a trading costs to income ratio of 46.6 per cent, which was in line with the average for the sector.

António Horta-Osório, chief executive of Santander, said: "We held back our market share during the first-half of last year when the market was writing low margin and higher-risk business.

"Since then the market has reduced and we have taken the opportunity to take higher margin, low-risk business and at the same time improving our customer retention.

"As a consequence, Abbey's net lending has increased significantly against the same period last year driven by strong performances in both retention activity and gross lending volumes.

"Our profitable lending growth has been balanced with a prudent risk approach targeting lower LTV business and continued reduction of our unsecured portfolio."