KOLKATA - HSBC India will go slow in the consumer credit business in 2009 following high level of ‘impairment’ of assets last year, a top official said here Thursday.

‘We continue to do lending in the retail space,’ Naina Lal Kidwai, who was appointed the country head of HSBC India Thursday, told reporters.

According to her, there is no point in growing the retail asset portfolio of the bank at a time when other banks are either reducing their exposure or shutting down this business.

‘We will be there in the consumer asset place but we are more selective. We are doing less open market sourcing and more from within our relationships,’ Kidwai said.

‘We have three million relationships, we do a lot of cross selling within those relationships,’ she added.

HSBC’s retail credit portfolio stood at $40 million as on Dec 31, growing by 15 percent in 2008.

On deposit and interest rates, Kidwai said it was difficult to bring down deposit rate as any cut from current levels would make them ‘unattractive’.

‘There are competing investment avenues available offering 8 percent safe yearly return. So there is stickiness in deposit rates,’ she said.

Though there is ‘pressure’ upon lending rates to go down, first deposit rates have to be lowered, she added.

Kidwai said the company would also look at ‘inorganic growth’.

‘We are wide open to look at acquisition depending on strategy and price,’ she said.

HSBC employs around 37,000 people in India, among which 7,000 are in the banking sector.

The bank expects India to achieve 6.2 percent gross domestic product (GDP) growth rate for the current financial year and 8 percent next year, which would be at par with China.

It is estimated that Asia would grow at 4.5 percent during the same period.