Public confidence in one of Asia’s biggest financial names remained fragile last night as Hong Kong’s banking community fought to subdue fears of a liquidity crisis.

Over two days, hundreds of Bank of East Asia (BEA) customers ignored assurances from the bank’s management, analysts and the Government and descended on branches across Hong Kong to withdraw their savings.

The throng dissipated after a HK$3.9 billion (£273 million) cash injection by the Hong Kong Monetary Authority, the territory’s de facto central bank, and a further statement from John Tsang, the Financial Secretary, that the BEA was adequately capitalised.

The Hong Kong bank run came as authorities around the world attempted to quell fears that the credit crisis has spread dysfunction into financial systems globally.

The Danish Banking Association is reportedly planning a package that will relieve pressure on local lenders whose sources of capital have all but evaporated. The central bank has bailed out Ebh Bank after effectively nationalising Roskilde, another Danish bank, last month.

Yesterday Swedbank, the Swedish bank, was also in defence mode, denying rumours that it had run into funding problems and that it was undergoing a flight of large customers.

Even in the Middle East, the central bank in the United Arab Emirates set up a $13.6 billion (£7.4 billion) war chest to supply banks with funding in case of emergency.

But snaking lines of worried customers in the heart of Hong Kong rattled the territory, whose banking sector had previously seemed fairly unruffled by the bloodletting on Wall Street, but which has had spectacular bank runs in past decades.

BOC Hong Kong, the Bank of China subsidiary that holds nearly 5 per cent of BEA, declared its support and pledged to “take measures . . . to sustain the stability of the bank”.

Analysts at Nomura Securities said that the rapid-fire government assurances and the cash injection by the currency board were clear signs of how quickly hearsay could translate into a “street-level collapse in confidence” in the financial system.

The two-day run on the BEA, which was Hong Kong’s first since the Asian financial crisis 11 years ago, was driven in large part by widely circulated panicky text messages. Jeffrey Tang, a 62-year-old BEA customer in Kowloon, who queued for five hours to withdraw HK$71,300, was prompted by two text messages warning him of a “stability crisis” at BEA. He told The Times that he was also motivated by BEA’s share price, which has fallen by nearly 60 per cent this year.

“If what BEA says about its health is true, I’ll put the money back next week,” Mr Tang said. “But do the bank bosses even know what is true any more?”

Total withdrawals from BEA on Wednesday were estimated at HK$2 billion by analysts at DBS Vickers Securities – a manageable 0.7 per-cent of the bank’s HK$300 billion deposit base.

Some of those queueing to withdraw their money cited fears that BEA had not properly assessed its exposure to the unwinding of Lehman Brothers’ huge positions, which the bank puts at about $54 million. Many savers took to the streets in protest after discovering that HK$13 billion of minibonds guaranteed by Lehman Brothers that they had bought were rendered worthless after the bank’s collapse. Some pointed to the suddenness of Lehman’s demise, saying that in the days before the Wall Street giant went bankrupt it was issuing assurances of its stability, in similar terms to those used on Wednesday by BEA.

The assurances were dismissed by savers who recalled the cast-iron guarantees given by the Hong Kong Government about the health of the Bank of Credit and Commerce Hong Kong right up until it was shut down in 1991.

But BEA analysts were quick to label the liquidity rumours malicious and exaggerated, sending the stock into a rally that left it 3.4 per cent higher by the close. That boost was underpinned by a public bout of BEA stock-buying by Sir Li Ka-shing, Hong Kong’s wealthiest man.

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