HSBC open to more buyouts in India

Having decided to acquire the Royal Bank of Scotland's (RBS) select operations in India, HSBC Group global head today said it is open to more acquisitions in the country to expand the scale of operations.

"We will explore every opportunity whether its organic or inorganic. If opportunities are available for us to build our platform in India we will take them," HSBC Holding Plc Group Chairman Douglas J Flint told reporters here.

"We have been around for about 145 years with 170 offices and 50 bank branches, which is pretty small for a country of so much importance, so whatever opportunities arise from regulatory change, reform or a simple opportunity we will seize them," he said.

Indian operation are the seventh-largest contributor to HSBC's global turnover.

Last year in July, HSBC agreed to acquire the Royal Bank of Scotland Group plc's retail and commercial banking businesses in India involving portfolios with a gross asset value of $1.8 billion as on March 31, 2010.

The total consideration will comprise a premium of up to $95 million over the tangible net asset value of the businesses.

The acquisition, which is subject to regulatory approvals, is expected to be completed this year, he said.

At present, RBS's retail and commercial banking businesses in India has 1.1 million customers served by over 1,800 staff through 31 branches.

In addition to this, HSBC acquired IL&FS Investsmart in 2008, now HSBC InvestDirect, a retail brokerage has more than 130,000 customers with outlets across 52 cities.

On listing at the India bourses, HSBC remained non-committal. "If capital pools are in India which can be accessed by listing here then it makes sense," he said.

The banks are well capitalised and the option to support Indian operation exists. So, the reason to list in India will not be because we are short of capital, it will because it makes sense to list in India, he said.

HSBC is listed in 5 countries, including China and the US.

Another UK-based lender StanChart, which also has operation in India, is listed on two stock exchanges in India through Indian Depository Receipts.

Source: Business Standard