HSBC has a very different strategy to its foreign bank rival HBOS in Australia, which announced last month that it would develop the business of its subsidiary BankWest in the eastern states by opening 160 branches over the next three years.HSBC Australia chief executive Stuart Davis said: "Our view has been that for a foreign bank to succeed in Australia you have to focus on your advantages. We could not see any point in rolling out a big branch network. That is taking on the big local banks in their area of strength. "HBOS may take a different view because BankWest has a strong position in the Western Australian market. Obviously it believes it can leverage that strength."HSBC's areas of strength include sub-custody management (the safekeeping of investment securities). Its acquisition of Westpac's sub-custody business last year put it in the number one position in the local market. Since then it has increased sub-custody assets from US$300 billion to US$400 billion through a combination of asset growth resulting from a strong equity market, increased investor activity and winning new business."More and more customers are looking to do their sub-custody business on a regional basis and we are number one in this market, with a 42 per cent share, and number one across the region," said Davis.The bank hopes to carve out another niche here with the introduction last month of a cross-border retail banking service HSBC Premier. The bank is targeting regular overseas travellers and expatriate workers, a segment that it estimates accounts for about five per cent of the population.HSBC says it will offer the same level of service to Premier customers in any of the 35 countries where the service will be available. Relationship managers will arrange to open overseas accounts before the customer leaves home.A customer can request that a credit history be transferred from the originating country to assist with access to credit overseas. The online service available to Premier customers will allow them to have a single view of accounts in all countries. Davis said this level of international banking connectivity was not matched by any other bank. "Anyone who has tried to open an account overseas will know how difficult it can be to deal with identification requirements, local compliance rules and getting overseas banks to recognise your employment and credit history. We have taken that out of the customer's hands."Davis said the next area the bank would address was alternative investments.HSBC has a big alternative assets business overseas and Davis believes there is a market for it here, although he will be targeting institutional rather than retail customers. HSBC Australia will hit US$100 million of pre-tax profit this year. Davis said the bank was on track to take pre-tax earnings to US$200 million within the next three years.