HSBC Bank Australia's investment in its business over the past year - with more branches, staff and services - has paid dividends. The bank yesterday reported a 12 per cent increase in pre-tax profit.HSBC made a pre-tax profit of A$282 million in Australia in the year to December - up from $251 million in 2009.Gross loans and advances increased 22 per cent to $16.5 billion. Residential mortgages were up 25 per cent to $8.2 billion. Commercial and international trade finance was up 23 per cent to $4.8 billion.Last year, HSBC added three branches to its network (in North Sydney, Canberra and Doncaster), taking the total to 27. HSBC Bank Australia's chief executive, Paulo Maia, said the branch expansion has helped the bank pick up new retail and small business customers.It will open two more branches in the first half of this year - in Perth and South Yarra - and is aiming to open another two by the end of the year.Maia increased staff numbers by 15 per cent last year and introduced a range of new SME products, such as an online forex service.Maia said he had no qualms about pursuing an aggressive growth strategy when other banks had taken a cautious approach to growing their credit portfolios."I am not concerned about the quality of the business we have written. The economy is picking up. "We have a very solid funding base that is not heavily reliant on wholesale markets. We have a strong deposit base and we receive funding from the group."We could have been even more aggressive."Maia said he was particularly pleased with the growth in the business from small and medium-sized enterprises. HSBC is looking for companies with turnover of around $10 million and a requirement for trade or other international services. The commercial banking division made a pre-tax profit of $105 million - up from $41 million in 2009.Pre-tax profit for the global banking and markets division fell from $177 million in 2009 to $105 million last year.