Insider Media Limited

Businesses in the West Midlands are “sticking their heads above the parapet” and making more growth-enhancing acquisitions. That’s according to Maurice Heath, HSBC’s head of corporate banking in the Midlands, who spoke to Insider. Heath said he expected businesses which exported to high-growth countries such as China and companies in the manufacturing and food and drink sectors to be the success stories of 2011 – but warned that in business “it’s a competition – it’s all about winners and losers”.

Heath is head of the division which manages corporate deals completed by companies in the middle market, with turnover of £25m and above.

He said: “We are definitely seeing much more activity in the first quarter of 2011 than the same period last year. We’re putting more facilities in place for clients, and economic indicators show increasing growth in businesses in the manufacturing sector in particular.

“Companies in the region are reducing debt levels and seeing much more positive cash flow. They’re really beginning to stick their heads above the parapet and are making deals which will position them well for the future.”

Looking to the year ahead, Heath said he expected manufacturing, engineering and businesses within the food and drink sector to develop further growth over the next year. He also said that companies which have expanded to produce and generate business overseas were likely to prosper.

“Business which export to high growth countries like India or China or manufacture components for companies out there are currently experiencing huge growth – and I’d imagine, will continue to do so. These are the companies that are well placed to grow and make acquisitions,” he said.

However, Heath said he expected the construction industry to remain “depressed” for a while to come.

He said: “Of course, there are still difficulties facing businesses – at the end of the day, it’s a competition and it’s all about the winners and losers. But where there are strong players, there will be opportunities.”

Heath said that when it came to funding, HSBC had “always had the same strategy to lending – before, during and after the economic downturn”.

“We have been able to support profitable businesses and continue to do so. My performance targets are focused on lending to stable, high growth businesses, and that’s what we will continue to do.”