Banks on both sides of the Atlantic yesterday scrambled to respond to mounting political pressure as public anger over their bonuses grew and US officials worked on a new levy to recoup the government's losses in the financial crisis.
US bank stocks fell throughout the morning in New York as investors took a dim view of the Obama administration's proposals to charge banks a levy to pay for the estimated $120bn that the government lost on its bail-out fund.
Lenders with a large deposit base, which are likely to bear the brunt of the planned levy, were the worst hit, with Bank of America, JPMorgan Chase and Citigroup all down by about 3 per cent.