But its disciples are not giving up just yet.

'I have been buying HSBC shares since the 1970s. Whenever I have any spare money, I buy some,' said Chan Shui-fong, a housewife in her 70s. Chan is an avid speculator on the market, and there are no prizes for guessing which is her favourite stock.

The bank does not disclose shareholder numbers but it is believed to be the most widely held stock by the city's retail investors. Many local brokers say most of their clients hold HSBC stocks and have done so for decades.

HSBC's recent decline does not trouble Chan. She started buying stocks in the 1980s and many of her purchases were done on the cheap.

But not everyone is that lucky.

For the past two years, one pensioner has been appearing at shareholders' meetings, berating senior management about the poor performance of the company's shares and its effect on her retirement income.

It seems she invested her pension in 10,000 HSBC shares at HK$140 each. That HK$1.4 million investment has lost half its value since.

HSBC and other bank stocks have become key selling targets for investors worried about their exposure to the European sovereign debt crisis as well as bankruptcies of mainland private enterprises.

The Basel III banking regulations on bank capital adequacy and liquidity to be implemented in the coming years is also expected to increase costs for banks and restrict their ability to make profit.

HSBC dropped below HK$56.60 last week - down 28 per cent in two months. It has underperformed the Hang Seng Index, which has lost 25 per cent over the same period.

The bank's chief executive, Stuart Gulliver, in May admitted the stock has been lagging behind its peers for 11 years, and announced a range of cost-cutting plans such as closing loss-making branches and operations, and laying off 30,000 staff by 2013.

'I believe these cost-cutting plans will lift HSBC, so I am still into the stock,' said Bernard Chan, president of Asia Financial Holdings.

'The current weakness is an opportunity to buy. Compared with many other banks and blue chips, HSBC is very cheap. I consider this a good time to buy low as I believe the stock will bounce back in the long term when the European sovereign-debt crisis is over. It is better to invest in the market leader than smaller banks.'

According to Christopher Cheung Wah-fung, chairman of Christfund Securities, some investors have indeed been selling HSBC or other banking stocks but there were many others who were planning to buy in as well.

'People are waiting to see the bottom. Since we do not yet know how far it will drop, many investors are taking a wait-and-see approach,' Cheung said.

'HSBC has been the first choice for many retail investors. More than 60 per cent of our 10,000-plus clients have holdings in HSBC. Many of them are in the market for the long haul and have not been panic-selling despite considerable drops in the stock.'

Another broker, David Tung Wai, said many of his clients have been buying HSBC for decades because they see it as a uniquely Hong Kong success story. Tung should know: he has been working in the industry for more than 60 years.

'Investors like its management. They also like the idea that HSBC pays a dividend every three months, making it a dependable source of income after retirement. Many investors buy HSBC for the long term, so they don't care much about short-term price swings.'

Tung blames short sellers for the plight of HSBC and other bank stocks. Short sellers bet on falling share prices by borrowing stocks to sell them and buying them back later at a lower price to pocket the difference.

Several countries such as France, Italy, Spain and Belgium have banned short selling of banking stocks temporarily while South Korea has banned all short selling. Tung and other brokers last week urged the authorities in Hong Kong to do the same.

'Many retails investors are feeling the pinch as they buy HSBC and other blue chips as their retirement protection. But now short sellers are eating into their investments and their life savings. It is not fair to retail investors.'

Tung said that even if the government did not ban short selling outright, it should at least watch for any market manipulation by short sellers.

The secretary for financial services and the treasury, Professor Chan Ka-keung, has rejected the idea of banning short selling but said the regulator would monitor such activities.

Unlike Tung, others see HSBC's current problems as a reflection of the changing times. Brian Fung Wei-lung, chairman of the Hong Kong Securities Association, urges investors to bear in mind that HSBC is not the company it once was.

'HSBC expanded substantially in the US and Europe in the 1990s. In the old days, it was only a Hong Kong and broadly Asian lender. It is now more exposed to risks in Europe and the US,' Fung said. 'But who knows what the future has in store. When the US and European markets improve, companies like HSBC with international exposure may be better off than regional banks.'

HSBC, says Fung, is like an old flame. The feelings are still there but the passion has faded. 'Hong Kong retail investors still like HSBC, but it is no longer their first choice.'