Halifax says IF is now experiencing daily application levels of 2,300 and rapidly approaching approved but not yet completed borrowing of £1 billion.

The seperately branded direct banking channel opened for business by phone late last year after software glitches caused delays in the opening of the Internet operation. Despite the set-backs, 54% of IF's business is now coming through the Web channel, an increase over previous estimates.

More than 23,000 intermediaries have registered to do business with Intelligent Finance, says Halifax, and over 50% of mortgage business is now coming through this channel.

Halifax says the sweeper system which enables IF customers to offset credit and savings interest is bringing new business across the entire range of personal banking products, with more than 65% of customers having a current account, credit card or personal loan. Over 90% of Intelligent Finance business is new to the Halifax Group.

The bank is also reporting a significant increase in customer business over its Direct and Online banking operations, ending the year with 409,000 registrations, up from 63,000 at the end of 1999. The bank says it online current account base almost quadrupled in the year, while its online savings account, Web saver, is now used by more than 100,000 customers.

The figures were released as Halifax reported group profit before tax and exceptionals of £1,892m up £138m, an increase of 8% over the previous year. Second-half profit at the group dipped by 10 per cent as competition for home loans increased and the bank upped spending on its computer systems. Halifax spent just under £200 million pounds in 2000 on technology in a bid to sell more products over the Internet and by telephone. That figure is expected to rise to about 220 million pounds this year.