British mortgage bank Northern Rock said today it had not drawn down any of the money from the emergency facility it had arranged with the Bank of England so far.
The Bank of England stepped in yestederday to rescue Northern Rock, Britain's fifth-biggest mortgage provider, pledging to provide emergency funds after a global credit crunch hit the bank's ability to raise cash in money markets.
Shares in the bank plunged yesteday after it disclosed the emergency facility and customers scrambled to withdraw their savings.
The Financial Timessaid customers withdrew around £1 billion (€1.45 billion) - or about 4 per cent - of deposits yesterday, including online withdrawals. Citing a source familiar with the situation, the Financial Timessaid a quarter of that amount was withdrawn from branches and more via the bank's website, despite problems accessing online accounts.
The bank's 25,000 Irish depositors looking to access their cash were largely disappointed as its website struggled to cope and phone lines came under pressure. Irish savers are understood to hold €2.3 billion in savings at the bank, an average of more than €90,000.
Northern Rock declined to comment on the amount of withdrawals.
Queues formed at Northern Rock branches across Ireland yesterday repeating a reaction seen across Britain, which prompted the bank to keep branches open late. Many people in the queues have said they are aware their cash should be secure, but they are moving funds elsewhere to be safe.
One branch manager in England was reportedly forced to ring the police when a couple barricaded her in her office after they were unable to withdraw £1 million of savings.
Savers have ignored pleas for calm and queued for a second day outside branches across the UK today to empty their accounts. Long lines formed even before counters opened as worried customers sought to withdraw money despite reassurances from the bank over the safety of their savings.
The Newcastle-based lender, the Bank of England and the Financial Services Authority have all called for calm, saying the bank is solvent and will continue business as usual.
Northern Rock has been the first major UK casualty of a credit crunch during the last two months, as it relies on the wholesale markets for three-quarters of its funding needs.
But if retail deposits, which had stood at £24 billion and provided the remaining quarter of its funds, are withdrawn it will exacerbate the problem and increase the amount it needs to borrow from the BoE at a penalty interest rate.