Ulster Bank recorded a 15 per cent rise in profits to £530 million for last year, according to parent company Royal Bank of Scotland (RBS).
RBS said Ulster Bank increased its customer base by 68,000 over the year, fuelled in part by the success of its switcher mortgage product.
Loans increased by 33 per cent to £25 billion, while deposits were up 21 per cent to £14.4 billion.
RBS as a whole beat analyst expectations with a 16 per cent rise in 2005 profits, and it said it would buy back shares worth up to £1 billion this year.
Europe's third-biggest bank said 2005 profits before tax, goodwill, amortisation and integration rose to £8.25 billion.
Income rose 14 per cent to £25.57 billion, fuelled by strength in corporate banking and at its US unit Citizens, while the bank said it kept a tight control on costs.
RBS has been under pressure to return cash to shareholders to signal it has shored up its balance sheet and does not plan any more big acquisitions, after several major purchases ranging from NatWest in 2000 to a $1.6 billion investment in Bank of China last August.
RBS said its tier 1 capital ratio was 7.6 per cent at the end of 2005, up from 6.7 per cent a year earlier. It had said it would consider share buybacks when the ratio was above 7 per cent.
The bank said its costs as a percentage of income remained steady at 41.8 per cent.