Principality Building Society has reported pre-tax profits of £30.8m for 2010, an increase of £16.5m from 2009.
The society says its secured loans subsidiary Nemo performed ahead of expectations and delivered strong profits.
It says in a tight market for credit the business has improved the quality of its loan book and the returns achieved from it.
Principality has capital ratios with a Tier 1 ratio of 13.34%, which increased from 12.49% in 2009.
But its Peter Alan estate agency business had a tougher time than the building society. Sales volumes took a downturn in a depressed market.
Peter Griffiths, group chief executive at Principality, says: “In the most testing of times we have further strengthened our balance sheet which remains in good shape with increased levels of capital, strong levels of liquidity and much improved profitability.”