Hong Kong and Shanghai Banking Corporation (HSBC) expects the profit before tax from its business in India to cross $1 billion in the medium term. The British banks profit before tax from its India operations stood at $700 million in 2010.

Asia has emerged as the growth engine of the world, and within Asia, India is a key component. Despite inflationary pressures the GDP (gross domestic product) growth of India is estimated at 8 per cent in the current financial year, said HSBC India Chief Executive Officer, Stuart A Davis. This economic prosperity is fuelling growth across segments from large corporates to the increasing mass-affluent segment. We are well poised to leverage this growth and are confident we would be able to meet our groups and shareholders expectations, he said.

The groups Asia strategy reaffirms the groups confidence in emerging markets. The India story is about potential and performance. HSBC India recorded its highest profits ever in 2010 and would work towards improving its performance in India, said Naina Lal Kidwai, group general manager and country head, HSBC India.

In India, HSBC plans to focus on financing top domestic and international companies. The lender would also target the affluent Indian population overseas to increase its wealth management business.

Davis said HSBC expected the share of revenues from commercial and retail banking to rise in India over the next few years. The proposed acquisition of Royal Bank of Scotlands commercial and retail banking operations in India would strengthen HSBCs position in these businesses, he said.

The transaction is expected to be completed by the end of this calendar year, subject to regulatory approvals. It would help us increase our distribution in India, Davis said.

HSBC Chief Executive Officer (Asia-Pacific) Peter Wong said the bank would increase its presence in key Asian markets, including India, Hong Kong, mainland China, Singapore, Malaysia and Indonesia. The bank expects its profit before tax from its Asia business to cross $5 billion in the medium term. The profit before tax would be aided by the rise in pre-tax profits in India, Singapore, Malaysia and Indonesia.

The banks profit before tax is already over $1 billion in Hong Kong and mainland China, where HSBC is the largest foreign bank, with over 270 branches. In Hong Kong, the bank enjoys the largest market share in deposits, credit cards, mortgages and local bonds.