UK banking shares are falling in the wake of the Bear Stearns' bail-out. The US institution is heavily involved in the toxic sub-prime home loans market, and any bank with exposure to American mortgages is being hit hard.
So HBOS is down 30p at 532p, with traders pointing to its involvement in so-called Alt-A mortgages, which are just a notch above sub-prime.
Indeed one bank's analysts were warning just recently about HBOS's Alt-A assets. In a "you couldn't make it up" moment, those analysts came from, yes, Bear Stearns.
Barclays has fallen 17p to 434p, Royal Bank of Scotland 10.25p to 332p, and Alliance & Leicester 18p to 514p. A&L has also been hit by news that credit rating agency Standard & Poor's had cut its rating from A+ to A and warned it may lower it further in the weeks ahead.
