India to remain economic powerhouse: CEO, HSBC worldwide
Despite warnings that growth in emerging markets is slowing, Michael Geoghegan, CEO of HSBC worldwide, is still betting on India. 10 top challenges for India
By Sudeshna Sen, ET Online |
Despite warnings that the momentum of growth in emerging markets is slowing down, Michael Geoghegan, CEO of HSBC worldwide, is still betting on India as a high growth story. "Let's face it, many other countries would love to have growth in the high single digits. Yes, stock markets have fallen, so growth may slow down a bit, because if people don't have confidence they stand back. But India and China are economic powerhouses, and that is not changing," he says. HSBC's first half results and warnings about the future hit Asian markets earlier on Tuesday.
HSBC just turned in first half results where its emerging markets performance, especially in the Middle East and Asia, to some extent offset the dismal showing in North America - and Mr Geoghegan believes the bank will stay 'very focused on emerging markets'. Emerging markets contributed to about 78% of HSBC's first half profits this year, given the losses in North America.
Speaking to ET just before taking off on his annual 68,000 mile pilgrimage to meet up with employees wordwide, Mr Geoghegan said that the current credit crisis is likely to leave Asia largely untouched. "What is happening in the developed world, you may say it needed to happen, a slowdown was necessary, because poor quality of credit had spread through the market.
In Asia, and India, the quality of credit is better. Asia is far more conservative in giving and taking credit. We see, in India, even more conservatism creeping in, in consumer finance, for instance. We see the quality of credit in Asia improving," he says. HSBC, which calls itself the world's largest emerging markets global bank, is targeting to ensure that 60% of its business comes from emerging markets; and not only because America is making losses. Global banking and cross border presence is a focus area for the bank: "We're able to give our customers the benefit of being present in multiple markets."
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Mr Geoghegan, who's due for a 'routine' visit to India soon, is looking for significant growth in all areas. "We have a strong presence on the ground, we employ about 30,000 people in India. We're now in all sectors including insurance, and we believe we'll be doing a lot more business in all income streams," he says.Download
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