BEIJING, Jan. 29 -- Bank of China (BOC) is looking for acquisitions abroad to strengthen product development at home but not strategic takeovers in new markets, Zhu Min, group executive vice president, said Friday.

Zhu poured cold water on recent speculation the mainland's No. 2 lender was exploring buyout candidates in the U.S. consumer finance market, saying he was not aware of any talks with U.S. financial service providers.

"If there are any opportunities abroad, we are open — we're basically looking for products," he told reporters on the sidelines of the annual meeting of the World Economic Forum held in the Alpine ski resort Davos.

Zhu cited Singapore as one possible place where BOC, which raised a combined US$13.7 billion through Hong Kong and Shanghai listings last year, could invest in firms that could expand his company's product capacity.

But when asked about talks with U.S. firms, he said: "I'm not aware of anything, no."

Rather, BOC's home market provided the best opportunities for growth, Zhu said. BOC's loan growth rate in 2006 was around 10 percent and would remain at roughly that level into 2007.

"This is really the best market in the world. Why should we leave this market and go into somewhere where we don't know very much, with only a 3 to 5 percent growth rate and a narrower margin?" he said. "There is huge room for product innovation."

Zhu said BOC still had some way to go before having the right structure to compete on an international scale.

"We have had to build our governance structure, our risk management and clean our balance sheet," he said. "However, even though we have big market capitalization, I don't think we are ready for international competition."

Turning to the economy, Zhu said China was on a more stable footing than one year ago, and that red-hot economic growth was trending lower despite the fact that the country posted its fastest rate in more than a decade.

China's economy grew 10.7 percent in 2006, new data showed Thursday, as investment and exports powered ahead despite a raft of government curbs to keep the pace of expansion in check.

China's economy has now grown at double-digit rates for four years in a row. "When we move to year 2007, the macroeconomic foundation is better than beginning of year 2006," he said.

"At that time, we were concerned about a real estate bubble, the auto industry declining in sales, about overcapacity in steel and shortages in electricity, transportation and oil," he said.

"Things look more balanced than they did a year ago but obviously there are still concerns because investor motivation is still very strong," he said.

Moves at the start of the year by the central bank to raise reserve requirements for the fourth time since June for the lending sector set the tone that reforms designed to strengthen the financial sector would continue, Zhu said.