Britain's "bad bank", which is running down the loans of two bailed-out lenders, said it repaid £3.7 billion to the government in the year to March 2015, bringing the total it has repaid to £14.1 billion.
UK Asset Resolution (UKAR) is the state-run "zombie bank" that does not take on new business.
It said it had reduced the size of its balance sheet by a further £8.8 billion during the period.
This brings the total reduction since its formation in 2010 to £49.7 billion, down almost 43%.
UKAR, which is winding down the loans of Northern Rock and Bradford & Bingley, in April began selling a portfolio of mortgages worth £13 billion and selling or outsourcing its mortgage servicing operations.
"We are now progressing two ambitious divestment projects which, if successful, will accelerate repayment of the government loans and ensure the stability of service to customers," said chief executive Richard Banks.
UKAR made an underlying pretax profit of £1.4 billion during the period, up 11% on the year before.
The number of mortgages held by UKAR which are three or more months in arrears fell by 23% to 11,976.
UKAR made an underlying pretax profit of £1.4 billion during the period, up 11% on the year before.
The number of mortgages held by UKAR which are three or more months in arrears fell by 23% to 11,976.
