HSBC has ruled out acquisitions as part of its growth plans for India and is showing preference for organic growth. HSBC Holdings Plc's group chief executive Keith Whiston said he sees no acquisition opportunities in India at the moment.

He was, however, quick do add: "We look at opportunities from all over the world and compare them on a like-to-like basis. The current ceilings on voting rights also coming into the equation."

"The best way to use our capital is to ensure that there is no premium attached, and our agenda is to grow organically," Whiston added.

Regulations today permit foreign banks to acquire 49 per cent stake in another bank, but limit their voting rights at 10 per cent.

Whiston said that ceilings are not necessarily an impediment to acquisition. "We have bought banks in other countries too. However, the preferred route is 100 per cent or at least a majority stake," he said.

HSBC India CEO Niall S K Booker added: "With a 49 per cent stake we have only 10 per cent voting rights. There is not much upside."

However, while some foreign banks have got around the voting rights issue, HSBC prefers to work with the regulator and is confident that things will change.

Meanwhile, even as HSBC's ranking has fallen to third position among foreign banks, Whiston said there has been a marked improvement in the bank's performance in the last few years.

"It has moved well in the right direction, and our strong presence in India helps us get closer to the Indian Diaspora across the world," he added.

"The population is stagnating globally or declining. Whereas the population in India is young and growing, indicating immense prospective for India," Whiston added.

Booker said the bank will have to look at opportunities other than banking including investment banking, securities business and mergers and acquisitions.

"Much of the M&As will be driven if the divestment policy continues," he said. The backoffice processing and software processing, which has been set up in India, will also contribute to the group's bottomline.

HSBC was the first to predict a global slowdown in February 2001 at the time of the announcements of its annual results. It still feels that the time is not right yet.

"We were right at that time.  The world has been facing difficult conditions and cannot see any light at the end of the tunnel. In US  the slowdown has accelerated, Europe is also passing through a difficult patch and so is South East Asia. China is growing rapidly and India is also growing at a very steady pace."