Citibank Says It's Back to Normal In Hong Kong
Citibank's Hong Kong operations returned to normal Friday afternoon after three days of unusually heavy withdrawals, the company said. But heavy withdrawals at Citibank's Australian operations were reported.
The withdrawals in both countries were partially sparked by comments made by Rep. John Dingell, D-Mich., about Citibank's parent almost two weeks ago, according to newspaper reports out of Europe and the Far East. During a session of the House Energy and Commerce subcommittee, Rep. Dingel said Citicorp was "technically insolvent."
The Hong Kong government's closure of local branches of Bank of Credit and Commerce International last month also was a factor in the withdrawal acticity, according to the reports.
A spokesman for Rep. Dingell said Friday the congressman still stands by his remarks but questioned whether they caused the runs at Citibank's overseas branches. Citicorp has denied Rep. Dingell's claim, calling it "irresponsible and untrue."
Heavy withdrawals began at Citicorp's 27 Hong Kong branches midday Wednesday and continued through Friday morning, according to reports. Lines of customers trying to withdraw their money extended out the doors of some branches at times.
Steven Baker, Citibank's division head for North Asian countries, said Friday that operations were back to normal and that "a number" of customers were redepositing their funds.
Bryan Clayton, president of Citibank's Australian operations, was reported saying there was a "marginal increase in withdrawals" on Friday and that most involved people with family and business links to Hong Kong.
The heavy Hong Kong withdrawals followed runs last month on smaller Hong Kong banks with Middle-East connections. Those panics were also related to the closure of BCCI.