Part-nationalised banking group Royal Bank of Scotland (RBS) saw profits double in the first quarter, helped by a reduction in costs and lower impairment charges.
Pre-tax profit surged to £1.64bn in the first three months of 2013, up from £826m the year before.
This came despite a 2% fall in income to £5.05bn, owing mainly to a decline in the Markets division, reflecting its smaller balance sheet and reduced risk levels.
"Just over two months ago, I set out our plan for making RBS the most trusted bank in the UK. Today's results show that in steady state, RBS will be a bank that does a great job for customers while delivering good returns for our shareholders," said Chief Executive Ross McEwan.
However, he said that the bank still has "a lot of work do and plenty of issues from the past to reckon with".
Expenses fell 6% year-on-year to £3.19bn, with Markets down 15% and other banking businesses down 3%.
The company said that benefits from certain "strategic cost reduction initiatives" will feed through in later quarters and it remains on track to deliver its target of £1bn of cost reductions this year. However, restructuring costs are likely to be "considerably higher" for the remainder of the year than the rate implied by the first quarter.
Meanwhile, impairment losses totalled just £362m in the quarter, down from £1.03bn the previous year.
The balance sheet was strengthened further with the common-equity tier-1 (CET1) capital ratio rising to 9.4% at March 31st, up from 8.6% at the end of 2013.
The group said it is making "steady progress" towards achieving a CET1 ratio of 11% by the end of 2015 and 12% or above by the end of 2016.
Insurer Direct Line reiterated guidance for its combined operating ratio but admitted that premiums fell in the first quarter.
Gross written premiums totalled £949.3m in the first three months of the year, down 5.1% at constant currency from the first quarter of 2013, as growth in the Commercial business and an improvement in Germany was offset by "competitive market conditions" in UK personal lines.
Motor gross written premiums in particular were 10.2% down at £326.9m, while Home and Rescue premiums also fell.
The number of 'in-force' policies fell by 2.1% during the three months to 18.1m from 18.5m at December 31st, and were 6.7% lower than the 19.4m reported the year before.
"The UK motor and home markets are highly competitive. The group will continue to prioritise targeting appropriate margins, even if this is at the expense of policy volumes," Direct Line said in a statement.
The company said it still aims to achieve a combined operating ratio - a key measure of profitability in the insurance industry - of 95-97% for the full year.