HSBC Holdings may be the fortunate beneficiary of Asia's economic growth but investors should not be under illusions as to its record in terms of pure management achievement, says British broker NatWest Securities. In a recent report, the broker - which has been bearish on HSBC since it took over Midland last year and moved its domicile from Hongkong to Britain - recommended selling shares in the stock which it believed to be ''expensive on fundamentals''. ''We . . . believe HSBC to be a poor bank and inasmuch as the Asian growth argument outweighs the political risk (we are not sure that it does, given HSBC's record), that is insufficient to warrant buying the shares on value grounds,'' the report said. ''We understand that investors may buy the shares to reduce performance risk but they should be under no illusions as to what they are buying.'' While the group has grown quickly over the past 12 years, little of that growth was generated independently of acquisition and economic growth, according to NatWest. ''If nominal asset growth is deflated by inflation and economic growth, then it becomes clear that real growth, independently generated, is very poor. ''Therefore, although the UK market is correct to view HSBC as a vehicle for participating in Asian growth, it is not a particularly impressive record of pure management achievement,'' the report said. While some brokers have a ''hold'' on the stock, most are recommending their clients to buy in. HSBC's nominal compound growth in assets during the period 1980-91 was 16.2 per cent against 11.8 per cent for the three main British banks. But after subtracting Hongkong's local inflation of 8.4 per cent and local gross domestic product growth of 6.2 per cent, independently generated growth is just 1.6 per cent, half of the 3.2 per cent achieved by the British banks in the same period. While estimating that last year's results, to be released next month, could see group pre-tax profits rising by as much as 85 per cent over the previous year to GBP1.66 billion (about HK$18.64 billion) - in line with market forecasts - the picture according to NatWest becomes distinctly gloomier thereafter. The market had overestimated the outlook for this year, which was set to decline significantly due to an absence of recovery gains, assets sales and the erosion of favourable conditions in both Hongkong banking and treasury. Underlying profit growth would fall to 12 to 13 per cent, although a full year's contribution from Midland might carry it up to 20 per cent. In terms of earnings per share, increased tax charges and a forecast 24 per cent increase in average shares in issue would conspire to produce an eight per cent fall to 50 pence - thus disappointing market expectations of a 10 to 15 per cent rise. Furthermore, during the period 1980-91, HSBC's ability to finance its growth from retained profits was essentially no different from that of the three main British banks, which in many ways had had to cope with a more difficult environment, the report said.