Royal Bank of Scotland calmed nervous shareholders yesterday by revealing that it had come across no nasty shocks after its joint acquisition of ABN Amro and expected to squeeze more synergies from the deal than it originally pencilled in.

Announcing an 8 per cent increase in pre-tax profits to £9.9 billion in 2007, Sir Fred Goodwin, the chief executive of RBS, said, “We are happy we bought what we thought we bought.”

There were “no eureka moments or silver bullets” but many cost savings such as a 20 per cent cut in ABN's stationery bill and savings in shared computer software. “There are a lot of areas where it just goes ching, ching, ching, ching, ching,” Sir Fred said.

RBS expects to make annual cost savings of €1.59 billion (£1.2 billion) and gain revenue benefits of €688 million from the deal by the third year, compared with €1.32 billion and €395 million estimated in its offer document in July. RBS led a consortium of Banco Santander of Spain and Fortis of Belgium paying €71 billion for ABN last year and expects final approval of the carve up of the assets by the Dutch authorities in the next two weeks.

Despite some shareholder concern about its balance sheet strength, Sir Fred expressed satisfaction with his capital ratios and said that he would not be a forced seller of assets, such as Angel Trains, which has been on the auction block for a year.

But RBS slammed the brakes on dividend growth, lifting the final payout by less than 5 per cent to 23.1p per share. At the half-year stage — before the credit crunch hit — it raised the interim payout by 25 per cent.

RBS confirmed that it had come through the credit crunch so far relatively unscathed for a bank of its size. Writedowns on sub-prime and other asset backed securities came in at £659 million, on leveraged buyout loans at £285 million. It also wrote off £456 million against the risk that insurers of sub-prime assets might default.

It said that the credit markets were not completely gummed up, revealing that it had managed to sell £3.6 billion of syndicated loans in the past two months including some leveraged buyout debt. Johnny Cameron, the head of the bank's wholesale division, said: “People can overestimate the stickiness of the market.”

RBS was a major backer of buyouts before the credit crunch and still has £8.7 billion of these loans on its books, which it now values at an average of 95p in the pound.

Strong performances from UK corporate and retail banking were offset by tougher conditions in the global markets division, the flood-hit insurance operation and the US retail bank Citizens. The bank benefited from several one-off boosts including a £950 million profit from the sale of Southern Water and £302 million from sale and leaseback property deals.

Sir Fred ruled out more acquisitions in the near future and said that the bank entered 2008 with momentum behind organic growth. He concurred with Hector Sants, the chief executive of the Financial Services Authority, that credit conditions had changed permanently. “It's not going to go back to the way it was, and that's a good thing.”

RBS said that it had refunded £119 million to customers complaining about excessive charges for unauthorised overdrafts.

The shares fell 8p to 402p.

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