HALIFAX Bank of Scotland went against the tide of branch closures yesterday by pledging to open 100 new sites in the next five years - but they will all be in the South.

The plans, which will represent the biggest network expansion by the Halifax since the 1970s, were announced as the group revealed that pre-tax profits rose 17 per cent to £4.81bn last year.

The new branches will be in 50 towns where Halifax has little or no presence, and another 50 where the company will move to bigger sites. It expects to create about 1,500 jobs in the process.

Yesterday's results were in line with market expectations after profits increased by 13 per cent to £4.84bn.

As a result, an estimated 2.5 million private investors will see their annual dividend payment increase by ten per cent, to 36.1p a share.

Profits from high street operations rose eight per cent to £2.28bn.

In mortgages, the business decided against pursuing growth in the final quarter of the year as its share of the new lending market fell to 21 per cent, against 23 per cent in 2004.

With consumer spending and inflation pressures appearing subdued, Halifax said it expected the Bank of England to lower interest rates from the present 4.5 per cent.

Chief executive James Crosby said: "Growth in the economy should quicken later in the year, ensuring that employment prospects will remain robust."