Posted on 09/24/2008 8:24:55 PM PDT by TigerLikesRooster
Rumours trigger bank run in Hong Kong
By Justine Lau and Tom Mitchell in Hong Kong
Published: September 24 2008 15:36 | Last updated: September 24 2008 19:16
Thousands of panicked depositors queued outside Bank of East Asia’s branches across Hong Kong on Wednesday to withdraw their life-savings on rumours that the lender was in financial trouble.
The territory has seen only one other bank run since its return to mainland China in 1997, when the International Bank of Asia saw large withdrawals in November of that year.
David Li, BEA chairman and chief executive, said: “Some people are spreading malicious rumours regarding us, which are not right. We have sufficient liquidity”.
“I will buy [Bank of] East Asia’s shares myself tomorrow,” he added.
The bank, which has 91 branches and is controlled by Mr Li’s family, said it had reported the matter to the police and the Hong Kong Monetary Authority, which regulates the territory’s banks. It had HK$397bn in assets as of June 30, making it the fifth-largest bank in Hong Kong by that measure.
Joseph Yam, head of the authority, hastily arranged a press conference to deny the rumours “categorically”. He said: “Deposits in the banking system of Hong Kong are very well protected. The banking system is robust.”
Under the territory’s banking regulation regime, depositors would receive compensation of up to HK$100,000 (US$12,900) each if they lost their savings because of the failure of a licensed bank in Hong Kong.
(Excerpt) Read more at ft.com ...
Ping!
And so it begins....
Figures in Hong Kong..........
Didn’t the Great Depression start like this?
Not to worry. The US will be more than happy to tack on a few billion for Hong Kong as well.
Holy toledo.........
Maybe I’m slow on the uptake, but does this have anything to do with our problems on Wall Street? Seeing that we’re in the global economy and inter connected? What I’m getting at, will our Federal reserve system be a banker or insurer of last resort if foreign banks start failing, and cause a ripple effect across the globe? Has anyone thought of that possiblity?
Also, don’t we have major investments in our stock market from overseas? So many overseas investors are losing money too?
Yes, effect is global. Foreign governments and financial institutions have significant investments to firms which went down or nationalized lately. Part of reason why they hastily bailed out some firms is that it would bring down these foreign institutions, leading to worldwide financial collapse. Especially, foreign investors bailing out of U.S. in panic could destroy U.S. economy.
This is what’s coming.
I had some of my cd’s out this evening, seeing which ones are coming due. As they mature, I’m taking the cash.
Don’t know what to do next, though.
I just finished talking with a friend living in Malaysia. He said bank panics are happening in Malaysia and Indonesia.
If we sneeze, the whole world will catch cold.
Bush is the worst President in my lifetime—70 years!
You must have slept through 4 years of Carter and 8 years of Clinton.
Worse than Carter??
I was alive when Carter was president, but too young to remember him now. It’s my understanding that he was the worst of the worst.
I was prosperous then.
Now, through no fault of my own, I stand to lose all I have earned in my lifetime.
Bush is a puppet.
That is mighty tough assessment, especially considering Carter and Roosevelt. But we are each entitled to our own judgments. God Bless you.
Why is Bush responsible for Democrat run committes refusing to rein in the controls on the lending institutions, why is he responsible for the democrats voting to do all they do? However, I will say that the president hasn’t used his bully pulpit the way it could have been used... Not that the media would cover it if he did.
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