UK bank HBOS has said financial markets will remain "uncertain" this year after reporting a 4% dip in annual profits.
Pre-tax profits at HBOS, which was formed by the merger of Halifax and Bank of Scotland, were �5.47bn, down from �5.7bn in 2006.
The bank said it had performed well for shareholders despite tough market conditions. It has increased its shareholder dividend by 18% to 48.9p.
In the UK, the bank forecasts householders will save more in 2008.
It expects "strong growth" in savers' deposits, despite stiff competition from other banks and building societies for those funds.
"We are well placed to take opportunities presented by these difficult markets and deliver good growth in shareholder value of the next few years," said chief executive Andy Hornby.
© British Broadcasting Corporation