The bank said the strong performance was down to growth in lending, higher UK interest rates and more transactional activity.

And despite rising interest rates, mortgage lending in the housing market was still strong, the lender said.

In quarter three, when rates had reached their present high of 5.25%, the bank said there had been a 35% quarter-on-quarter increase in home loan approvals.

Chief executive Vicky Davies said: “I am pleased to announce a strong set of results for the first nine months of 2023.

“A robust financial performance means we are well positioned to continue to support customers and to invest in improving customer experience."

Total income rose by one-third from £191.4m in the first nine months to 2022 to £254.5m, while there was a 1.7% drop in deposits from £10.7bn to £10.5bn.

Ms Davies said the year had also brought £450m in business lending approvals, with a range of big business names benefiting.

“In quarter three this included growth funding support for Belfast Harbour, Belfast International Airport, Park Electrical Services, and Killahoey Ltd – aiding their acquisition of Rushmere Shopping Centre and Retail Park in Craigavon.”

She said that low unemployment had also contributed to the “resilient” environment for mortgage lending, even in the face of the 14th increase in the base interset rate in a row to 5.25%.

However, customer behaviour was changing. “In what has been an ever-changing interest rate environment we have seen most new mortgage customers this year opting for a two-year fixed product, as opposed to a five-year fix, which was more popular last year.

"Around half of the new mortgage lending we have approved across the UK in 2023 has been through our carbon neutral mortgage product.”

And despite the challenges of the cost-of-living crisis, customer arrears were low.

The settled financial environment also enabled it to release £13.8m which had been set aside for bad loans.

Ms Davies said: "The vast majority of customers are managing to prioritise the repayment of loans, but we are being proactive and reaching out to customers on variable rates, tracker products, interest only and those we have identified as being most likely to potentially struggle with higher payments.

“Our advice to both personal and business customers worried about affordability is to always contact us at the earliest possible opportunity. We will take an empathetic and supportive approach, with a range of tailored forbearance options in place to meet their individual circumstances.

"Overall lending arrears levels across the bank remain very low. Moving forward we are resolute in our commitment to help customers, colleagues and society - while continuing to play an integral role in supporting the local economy.”

Customer embrace of digital banking was also growing, she said, with a 25% increase in the last two years in customer log-ins to digital channels. They are now able to open new savings accounts through the mobile banking app, and apply for personal loans digitally, she added.

Danske Bank has 28 branches across Northern Ireland. Four premises in Lurgan, Cookstown, Kilkeel and Fivemiletown were shut in September last year.