Normal operations resumed at local banks

Friday, September 26, 2008
Issue 478, Page 4
Word count: 548
Published in: Macau Daily Times

By Poyi (Natalie) Leung

Normal operations at Luso International Banking Ltd (LIB) and Banco Weng Hang were resumed yesterday and crowds of customers were not sighted at branches wishing to withdraw their savings from accounts.

According to Banco Weng Hang yesterday, the total amount of withdrawals its branches had registered on Wednesday was HK$550 million, adding the lump sum just accounted for a “small proportion” of its 16 billion pataca total bank deposits.

Luso International Banking Ltd also estimated its customers had withdrawn about 200 to 300 million patacas on the same day as a result of the rumour, the Macao Daily News reported.

The rumour that was spread widely in the local community started Tuesday and had Luso International Banking Ltd going bankrupt within two days due to holding of Lehman Brothers bonds. This prompted thousands of concerned customers to race to withdraw their money at its Nam Van head office and branches on Wednesday.

Banco Weng Hang was also affected very soon in the afternoon with nearly one hundred people lining up for cash withdrawal requests at its head office in San Ma Lou.

The Macau Association of Banks, Monetary Authority of Macau as well as the two affected banks held separate press conferences on the day to clarify the “insubstantial” collapse of the local banking system.

Banco Weng Hang also published a clarification in local newspapers yesterday.

Director and general manager of Banco Weng Hang, Lee Tak Lim, told the Macau Daily Times their business went back to normal in the afternoon yesterday where no queues were formed, but branches still prolonged opening hours for 30 minutes until 6pm.

“In the morning there were still a few hundred customers requesting to withdraw their savings, but they were scattered among 12 of our branches so actually the impact was not so obvious,” Mr Lee said.

Although HK$550 million was withdrawn in one single day, Mr Lee assured that Banco Weng Hang’s financial condition was still and had always been “strong and sound”.

Banco Weng Hang allowed customers to withdraw full amount of their unexpired fixed deposits on Wednesday but no interest was given except for a “very small number of old customers”.

“It was already a very rare situation for customers being able to take away the full amount of fixed deposits before the term was up,” Mr Lee told the MDTimes.

“So if these customers come back to our bank in the future they will need to open a new fixed deposit account without being entitled to any previously accumulated interest or otherwise it will be unfair for other customers.” he added.

The Banco Weng Hang chief said yesterday the rumour which was circulated so “quickly” in Macau had already been “fully settled” thanks to the government and the industry’s prompt clarification that “gave very strong confidence” to the public.

An internal investigation is being carried out at Banco Weng Hang to try to track down the source of the fabrication, Mr Lee said, adding police will be reported if it is found to be malicious.

“We cannot let harmful and insubstantial rumours be circulated that affect our society,” he added.

Meanwhile, Banco Weng Hang’s branches in the Inner Harbour and northern district which were closed on Wednesday due to flooding already had their facilities fixed and reopened yesterday.

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