London, June 1: International banking giant HSBC Holdings said on Friday its performance so far this year was ahead of plan. "So far in 1997 our performance is ahead of plan," chairman Sir William Purves said in a statement from the bank's annual meeting.

Purves said HSBC would seek to retain its position "as the leading financial services organisation in Hong Kong" and would develop its personal banking elsewhere in the Asia-Pacific region.

He said HSBC would build its investment banking business organically and would look to insurance to gradually become its third major business segment. And controlling costs would remain an essential discipline for the entire group.

In Britain and Europe, HSBC will focus on customer service, using technology to improve quality and productivity, while in the US it will integrate its acquisitions and aim for deeper market penetration, Purves added.

"I am optimistic that we can meet the competitive challenges posed by technological developments, consolidating markets, the changing political landscape and the entry of non-traditional participants to our market," he said.

In Buenos Aires, analysts said the purchase of Argentine private financial services holding Grupo Roberts announced on Friday by HSBC Holdings Plc was no surprise after two major Spanish banks took control this month of two top Argentine banks.

"This is the natural transition from being a minor stakeholder to being a major one," said an analyst for Merchant Bankers, an affiliate of Salomon Brothers. "The decision was helped by recent purchases in Argentina by Spain's Banco Santander and Banco de Bilbao Vizcaya."

HSBC said in a statement in London the bank would buy all the shares issued in Grupo Roberts, a holding that includes Banco Roberts, for between $600 and $688 million. HSBC already had an indirect stake of 29.9 per cent in Banco Roberts.

"The announcement by HSBC was no surprise as the Argentine market offers great opportunities due its low banking penetration and good economic prospects," the commercial manager for a major foreign bank said. Ignacio Lafuente, head trader for Banco Frances, said the HSBC deal would make the banking sector more solid although he warned against excessive concentration. When the Mexican devaluation crisis struck in December 1994, Argentina had 168 public or private banks. By last October, they had shrunk to 118 through closures or mergers. Spain's Santander announced it bought a 35.06 per cent stake in local Banco Rio for $594 million.

with an option to buy another 15 per cent. The first stake involves voting control. Earlier this month, fellow Spanish bank Bilbao bought 71.8 per cent of Banco Frances for $466 million.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.