allendalepharm Chapter 614: Hengsheng Crisis
Chapter 614: Hengsheng Crisis
Soon He Lai got in touch with Lu Zixuan on the phone and told him to contact the boss of Hang Seng Bank, saying that he wanted to discuss cooperation with them.
Lu Zixuan told He Lai that Lai Xin Industrial's current working capital is about 500 million Hong Kong dollars, and more can be mobilized if necessary.
He Lai turned around and thought about it, then called Huo Ying and Fu Huo to express his plan to acquire Hang Seng Bank and hoped that they could help him when the time comes.
Huo Ying and Fu Huo naturally agreed, especially Fu Huo, who said on the spot that he could take out 200 million Hong Kong dollars and deposit it in Hang Seng Bank.
He Lai was very satisfied. After all, he had two Chinese tycoons, Lei Luo and Bo Hao, on his side. It has been 65 years, and he believed that they should have a lot of assets in their hands.
The next morning, Lu Zixuan came to He Lai's villa.
"Mr. He, this morning five people from the industrial park took the initiative to confess their problems, returned the embezzled money, and also confessed a lot of people."
Lu Zixuan said awkwardly.
"Well, take your time with this matter. There's no rush. What does Hang Seng Bank say?"
He Lai nodded and asked.
"Ho Shanheng from Hang Seng Bank has agreed to meet with you." Lu Zixuan said.
"Well, when?"
"Now you can."
"Oh, it seems that this He Shanheng is in urgent need of money. Haha, OK, let's go."
He Lai said with a smile.
"That...that..." Lu Zixuan hesitated to speak.
"What's wrong, Zixuan? Just say it if you have something to say." He Lai looked at Lu Zixuan and asked.
"Okay, Mr. He, actually, there is no need for us to take such a big risk to acquire Hang Seng Bank. After all, this is obviously a trick of HSBC. If you do this, you may offend HSBC."
Lu Zixuan said truthfully.
"What? Are you afraid of offending your old boss?" He Lai looked at Lu Zixuan who was somewhat embarrassed.
"Mr. He, you misunderstood me. I'm not afraid. It's just that HSBC, as the official representative bank of Hong Kong City, controls most of the economic lifelines of Hong Kong City. The upper class people all know that this is a plan against Chinese banks. All of this was promoted by them, and the purpose is to acquire Hang Seng Bank." Lu Zixuan explained quickly.
As the largest bank in Hong Kong, HSBC can print Hong Kong dollars, which means it can issue currency. You can imagine how big the system is.
However, Hang Seng Bank has been developing better and better in recent years and has occupied most of the lower-class people in Hong Kong. Naturally, HSBC will not sit idly by and want to swallow it up directly.
"And Mr. He, we have already acquired a bank with Mr. Huo. There is no need to acquire Hang Seng Bank. It is not a wise choice to provoke HSBC."
Lu Zixuan continued to persuade.
"Haha, Zixuan, don't take it so seriously. HSBC Bank wouldn't dare to do anything rash. The Hong Kong government has always been saying 'active non-intervention', letting the market solve the problem on its own. We just follow their wishes.
As the leader of Chinese banks, Hang Seng cannot be acquired by British banks. If it is acquired, it means that the people of Hong Kong will no longer trust Chinese banks, and all Chinese banks in Hong Kong will have to look at the faces of the British. "
He Lai explained with a smile.
"But He Sheng, our Port City is originally the territory of Eagle Country. If you do this, you may cause unnecessary trouble."
Lu Zixuan was still worried.
"Zixuan, don't be afraid. Gangcheng is a special place now. It is true that Gangcheng belongs to Eagle Country, but it does not mean that Eagle Country can completely control everything. After all, 80% of the people in Gangcheng are Chinese.
HSBC is not omnipotent, otherwise it would not use such despicable means to force Hang Seng Bank to compromise instead of confronting it head-on. "
He Lai continued.
"Okay then, I'll listen to He Sheng." Seeing that He Lai said so, Lu Zixuan stopped trying to persuade him.
"Okay, let's go, meet me at the Hang Seng Bank."
After He finished speaking, he led the way out of the villa.
Hang Seng Bank entrance
There was a long queue with no end in sight. Everyone was holding a deposit certificate in their hands, wanting to withdraw their hard-earned money from Hang Seng Bank, fearing that the Bank would declare bankruptcy the next second.
There are too many bank bankruptcies in this era, especially during the liberation period. Banks, as people called them, were money houses. If they went bankrupt, they would go bankrupt, and the people would lose every penny of their money.
It was the first time for He Lai to see such a scene, and he still felt a little sad. The lower-class citizens were indeed too easy to follow the trend. The panic made them willing to stay out of work to withdraw their money.
This is also the sad thing about Chinese banks. Their business targets are all these ordinary people. After all, British banks will not accept money from these lower-class people. After all, the money is too little and not worth it.
After entering the Hang Seng Bank, He Lai and his companions were quickly received by someone. After learning of He Lai's identity, they were immediately invited into Ho Sin Hang's office.
Ho Sin Hang is really in a state of panic now.
From the beginning of 1965, a war against Chinese banks began to spread. At first, a check for 700 million Hong Kong dollars from a small bank "Ming De Silver" was bounced!
The reason, of course, is that they cannot come up with the money, as the money has been lent out by Mingde Lending and was not redeemed immediately.
As soon as the news came out, Mingde's depositors panicked and all ran to withdraw their money! Mingde Bank collapsed in an instant.
In that era, "panic" was the most terrible infectious disease.
Because Mingde was a Chinese-owned bank, citizens suddenly lost confidence in all Chinese-owned banks and rushed to various banks to withdraw money.
In this way, Trust Bank, Far Eastern Bank, Wing Lung Bank, Ka Wah Bank, Dao Heng Bank, Kwong On Bank... all experienced bank runs.
Soon after, a bank run also occurred at the Trust Bank, and within two days, all operations were announced to be suspended.
That afternoon, the disease affected many Chinese banks, including the largest Chinese bank at the time, Hang Seng Bank, as well as Kwong On Bank, Dao Heng Bank, Wing Lung Bank and other banks. It continued to spread to Far Eastern Bank and Kwong On Bank, and also affected the gambling city.
The Hong Kong City Government immediately arranged for HSBC to provide unlimited funding to support Hang Seng Bank, Far Eastern Bank and Wing Lung Bank, while Standard Chartered Bank supported Dao Heng Bank and Kwong On Bank.
Because of this incident, the Hong Kong City Government also limited the maximum amount of money each person could withdraw to prevent malicious disruption. After all, a chaotic scene was not what the Hong Kong City Government wanted to see.
Some of these Chinese banks survived, such as Wing Lung Bank; some did not, such as Trust Bank.
Even Hang Seng, the largest Chinese bank at the time, almost collapsed and had to change its name.
After Mingde got into trouble, several banks came out to support it, and with the Hong Kong government’s guarantee, the situation was temporarily stabilized.
But not long after, many news reports slandering Chinese banks appeared in the newspapers, including Hang Seng Bank, and a second round of bank runs immediately hit Hong Kong.
Just recently, people who went to Hang Seng Bank to withdraw money lined up from the Central Head Office to Statue Square. In one day, 8000 million was withdrawn, accounting for one sixth of the total deposits. In just half a month, 2 million was withdrawn! That was 60 million in the 2s! It cost Hang Seng half its life.
The founder of Hang Seng Bank, Ho Sin Hang, tried everything but failed to save the bank.