Oct. 10 (Bloomberg) -- Londoners stood in line outside the largest gold coin and bar retailer in the city's West End shopping district, clogging the lobby and trading among themselves as they sought a safe haven for their money.

``People want something tangible, something they can hold on to, something the banks can't give them,'' said Chris Burrow, the owner of ATS Bullion, the gold dealer in the Strand that traces its roots back to the 17th century. ``There's no time to breathe. We're rushed off our feet. Staff are exhausted.''

As U.K. stocks tumbled to a five-year low, paced by financial-services companies, gold advanced. Since Lehman Brothers Holdings Inc.'s Sept. 15 filing for bankruptcy protection, exacerbating the worldwide credit crisis, gold for immediate delivery has jumped 19 percent.

``Investors are rushing to safe havens and physical gold seems to be the favorite one,'' said Frederic Panizzutti, a senior vice president at MKS Finance, one of Switzerland's four bullion refiners.

British government action to prop up the banking industry has failed to reassure investors. The U.K. on Oct. 8 promised 50 billion pounds ($86 billion) of capital to banks, the same day the Bank of England cut its benchmark interest rate by half a percentage point. Last month, the government brokered a takeover of HBOS Plc, Britain's largest mortgage lender, and seized control of Bradford & Bingley's mortgage division.

`Jumping in the Sea'

``I'm uncertain about the banks and I don't want too much of my cash with them,'' said Mark Thomas, 33, who was waiting to buy 2,000 pounds worth of gold from ATS today. ``It's about protection.'' He said he owns about 5 kilograms (11 pounds) of bullion.

Some were buying the metal for the first time.

``It's like jumping in the sea,'' said Ann Ferguson, 70, a retired librarian. ``I've never done it before.''

London bullion merchant Baird & Co., which began offering gold bars in London's financial district in May 2007, said ``all sales of gold coins'' were on hold as of Oct. 7, according to a statement on its Web site.

``The financial sector has been distorted beyond recognition and investors have lost faith,'' said James Moore, an analyst at U.K. metals information Web site TheBullionDesk.com.

In the lobby of ATS, Neil Lovegrove, a 24-year-old engineer, sold a Krugerrand to a buyer who couldn't wait to get into the sales area. ``The queues were too long,'' he said.

`Something Is Wrong'

Gold futures for December delivery jumped $29.30, or 3.3 percent, to $915.80 an ounce at 9:01 a.m. on the Comex division of the New York Mercantile Exchange. A close at that price would be the biggest weekly gain since Sept. 19.

Waiting to buy coins or bars at ATS, Brijesh Patel said he'd take whatever was available.

``I've never seen anything like it. I'll just get anything, whatever they have left,'' said Patel, a 25-year-old salesman. ``Gold is an indicator of confidence. When it's disappearing, it shows something is wrong.''

As the Reuters/Jefferies CRB Index of 19 raw materials fell for the second day, gold headed for its biggest weekly gain in almost a month.

``Demand for gold will continue,'' ATS's Burrow said.

To contact the reporter on this story: Jonathan Browning in London jbrowning9@bloomberg.net.

Last Updated: October 10, 2008 10:38 EDT