Iseq slides over 3% on banking sell-off

Iseq: 2,484 (-86) at 12.28pm:The Dublin market was over 3 per cent lower this morning as banking stocks were sold off across Europe.

At 12.28pm the Iseq index of Irish shares was off 86 points at 2,484.

Irish banking stocks came under renewed pressure this morning due to ongoing investor concerns whether the banks can raise enough capital to manage through the recession.

Anglo Irish Bank was the biggest faller among the banks dropping to 94 cents, a fall of over 15 per cent. Earlier the stock had been 18 per cent lower.

Irish Life and Permanent stocks were over 11.5 per cent lower at €1.38.

AIB shares were also sharply lower, dropping over 7.7 per cent to €2.44, in part due to a fall in the share price of its US subsidiary M&T overnight.

Bank of Ireland shares remained weak this morning, falling to 81 cents in early trade before rebounding to rise to 90 cents, a gain of 8 per cent.

Bank of Ireland's shares have been under pressure since it scrapped its dividend last Thursday and reported a 32 per cent drop in underlying pre-tax profits.

Analysts said buyers for banking stocks were "thin on the ground" on a Europe-wide basis with Lloyds-TSB down 9.7 per cent and HBOS off 9 per cent on the FTSE 100.

In France BNP Parabis stock was over 8 per cent lower with Societe Generale off 7 per cent.

Major world banks showed the strain today with Britain's Barclays altering its fund-raising plans to quell shareholder anger and profits in Japan's largest bank tumbling.