Preview of coming days? A bank run underway in Hong Kong.....

[marmar]

from Bloomberg:



Hong Kong Savers Fret as Bank East Asia Fights Rumors (Update2)

By Kelvin Wong and Theresa Tang

Sept. 25 (Bloomberg) -- For the first time since the Asian financial crisis more than a decade ago, Hong Kong has faced a bank run.

Hundreds of depositors lined up at the city's third-largest lender Bank of East Asia Ltd. yesterday as the bank hit out at ``malicious rumors,'' and Chairman David Li rushed back to Hong Kong from the U.S. to reassure clients and investors. The city's central bank jumped to BEA's defense and police said they're investigating phone text messages questioning its health.

``The rumors were groundless,'' Li, 69, told reporters at Hong Kong's airport late yesterday. ``The bank has no problem.''

BEA's woes underline how a year of turmoil in financial markets has undermined confidence in the global banking system. Britain's government last year bailed out mortgage lender Northern Rock Plc after a run. The U.S. took over American International Group Inc., the nation's biggest insurer, to prevent the worst financial collapse in American history.

In Singapore, customers thronged outside the offices of AIG's local unit this month to terminate their policies.

BEA gained 3.2 percent in Hong Kong pre-market trading after dropping 6.9 percent yesterday. The 90-year-old lender said its ``exposure'' to bankrupt Lehman Brothers Holdings Inc. and AIG is less than 0.2 percent of assets.

Joseph Yam, chief executive of Hong Kong's central bank, today urged depositors to ``stay calm.'' Under Hong Kong's deposit insurance program, bank depositors are protected up to HK$100,000 in the case of a bank failure. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aII1tgrPIB.s&refer=home

[Doctor Cynic]

1. Li Ka Shing has bought into the bank.

He's very much like the Warren Buffet of Asia, and has put an unspecified amount of $ into it.

This crisis is most likely over, but WaMu's long term debt is now officially junk.

If they go then things will go very bad.

[MercutioATC]

2. If the money is insured, it's not really a "run"...

Yes, the bank has immediate cash flow issues, but everybody gets their money.

Are there any major nations without something similar to FDIC insurance?