HBOS threw down the gauntlet to the big four high street banking players in Australia as it launched a £160 million expansion drive that will see it open more than 160 branches on the country's East Coast by the end of the decade.

The push by HBOS, through its Australian subsidiary BankWest, represents the largest ever banking expansion to take place in Australia, and is the UK bank's single biggest current investment project.

It will be driven by Ian Corfield, a five-year staffer at HBOS fresh from expanding its Irish network. HBOS named him as chief executive of retail banking at BankWest today. Mr Corfield, a 35-year-old Yorkshireman, previously ran HBOS's credit card arm.

Some 3,000 staff will be hired in Australia as HBOS sets up more than 125 retail, or "Main Street" branches, predominantly in the country's increasingly popular shopping malls. A further 35 business branches will follow. The first branches begin opening later this year.

HBOS, famed for its "Who Gives You Extra" TV campaign in the UK featuring real employees, will be taking the same approach in Australia, where the tax system and banking culture are similar to the UK's. The expansion will be purely under the BankWest brand.

HBOS's chief executive, Andy Hornby, has targeted Australia alongside Ireland, continental Europe and North America as big new potential profits drivers for the bank.

HBOS is the biggest UK bank operating in Australia, where 80 per cent of the population live on the East Coast.

"We are quite realistic. We are not going to take over the big four's patch overnight. But there's plenty of room for all of us," a spokesman said. HBOS currently has about 4 or 5 per cent of the retail market, he said, and will be hoping to snatch business away from incumbents National Australia Bank, Westpac, Commonwealth Bank and ANZ.

The move involves a relatively modest level of investment, but will mark a shift in HBOS's presence in Australia. It currently sells mortgages, current accounts, savings and loans through 90 branches, predominantly on the West Coast. It has 800,000 customers and 5,000 staff.

HBOS described the move as "phase 2" of its Australian adventure. It said that the time was right to gatecrash the "large incumbent banks with significant and healthy margins". It has been in Australia for the past ten years through its stake in BankWest. Four years ago it bought out the minority holders.

Profits have grown 66 per cent over the past three years from £168 million to £279 million.

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