Financial crisis weighs on executives' minds

NEW YORK/SINGAPORE (Reuters) - The most serious financial crisis in decades has caused business executives and government officials around the world to rein in their expectations for short- and long-term growth and warn that business volatility will be around for some time.

In a series of interviews with Reuters reporters, executives -- from industries as varied as oil to property to construction crane rentals -- spoke of the widening global credit crisis and their many concerns.

Most said they were keeping a close eye on Washington, to see how the $700 billion bailout package designed to halt the crisis would work.

Stock markets around the world continue to struggle due to concerns the bailout will not be enough.

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Following are excerpts and highlights from interviews with executives on Wednesday and late Tuesday:

DEVON ENERGY CORP'S PRESIDENT JOHN RICHELS

Richels expects the current credit squeeze will force many mid-size players in the oil and gas industry who are short of cash to merge in order to fund their operations.

"You're going to see a lot of consolidation among the intermediate group, mid-size companies that will see an advantage in becoming larger size and having a larger scale and being able to take advantage of some of the economies of scale," he said.

"A lot of people put together some pretty exciting and highly prospective assets and there is going to be a squeeze on their ability to be able to develop that," he added. "The likelihood of consolidation is going to be higher in the next few years than it has been."

FIRST SOLAR INC CHAIRMAN AND CEO MICHAEL AHEARN

The solar cell maker has felt no immediate effect on its business from the financial crisis and could take on a role in financing new projects or buying new technologies, he said.

The maker of thin-film photovoltaic cells told the Reuters Global Environment Summit that the fast-growing industry would likely face higher costs of capital because of the credit crisis, and that First Solar could help finance new projects.

"First Solar is in a relatively strong position," Ahearn said. "There may be some be opportunities for us to help facilitate lower-cost credit."

HSBC HOLDINGS CEO MICHAEL GEOGHEGAN

The chief executive of HSBC, Europe's biggest bank, said a rescue plan for British banks unveiled on Wednesday set a dangerous precedent but the government had little choice.

"I sympathize with the British taxpayer. I don't think it is right that the British taxpayer should need to bail out banks ... it sets a bad precedent, but the government had no alternative," Geoghegan said in an interview in Istanbul.

Geoghegan said he expected "light at the end of the tunnel" of the credit crisis by 2010 or 2011. He said it was too early for HSBC to look at acquisitions, but its shareholders had indicated they would be willing to raise capital if it did so.

Geoghegan, who was on a global roadshow, said many countries already were in recession and it was the developed world which would feel the impact of the crisis first.

AXA INVESTMENT CEO DOMINIQUE CARREL-BILLIARD

The head of AXA Investment Managers said the company was coping well up to now with the global financial crisis and expected good results for this year despite the market slump.

"As of today, I don't see any cause for alarm, neither on AXA IM nor on its funds and I expect that our results this year will be good," Carrel-Billiard said.

Carrel-Billiard said AXA IM had a business model that was proving to be relatively resilient in the crisis. He said the company was helped by its overseas businesses and the fact that it was part of a large parent group.

He added that he expected the current market crisis to cause opportunities for sector consolidation.

"We are starting to see certain deals arriving."

BOSNIA CENTRAL BANK GOVERNOR KEMAL KOZARIC

Bosnia's 2008 economic growth is expected to fall below a six percent target in response to the global financial crisis, the central bank governor said.

"The increased banking interest rates on loans to private firms seen as more risky may slow down economic growth," Kozaric told Reuters.

The 6.2-percent GDP growth of 2007 was expected to go down slightly to 6 percent in 2008 but Kozaric now said it may fall below 6 percent.

"It is certain that economic growth will slow down in the second half to under 6 percent," he said, adding that credit growth has fallen to 27 percent from 29 percent in the last six months.