If only to assure depositors that their deposits are still intact and the banks are not running out of cash, rural banks in Yancheng city displayed stacked piles of cash in plain view.

One local bank had stacked bricks of yuan notes above head level behind the tellers to show that there was enough cash. In another bank, tellers were seen stacking cash piles to as high as a double deck bed behind the teller's glass.

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The rural banks made the bold move to appease depositors' concern that their money could be lost when the banks shut down. The shutdown rumor had created a panic resulting to queuing at bank branches for three days straight.

Authorities said the rumors started when one local bank allegedly turned down a customer's request to withdraw 200,000 yuan, or US$32,000. The rumor immediately spread that in just a matter of hours people were already seen queuing in local banks.

Authorities said the issue is so small that it cannot affect China's financial sector. Banking sector authorities also assured that the rush for cash is an isolated case.

Jiangsu Sheyang Rural Commercial Bank was first targeted although one depositor, who runs a small store opposite the bank, said he did not join the rush because he didn't believe the rumor.

Local officials had made repeated appeals to calm down but people continued to queue outside their banks. The rush had even extended to the Rural Commercial Bank of Huanghai.

Analysts said the reaction of residents in Yancheng city on the rumored bank shutdown could have something to do with the latest report about credit defaults.

The People's Bank of China, the country's central bank, has assured that interest of all depositors will be protected.