UKX FTSE 100 Index

By Carla Mozee, MarketWatch

Shares in embattled Banca Monte dei Paschi plunges

European stocks slipped Wednesday, but hovered around their highest level of the year, with investors assessing developments surrounding embattled Italian lender Banca Monte dei Paschi, as well fines against some European lenders by a Swiss regulator.

The Stoxx Europe 600 index gave up 0.2% to 360.75 as the financial, utility and basic material sectors declined. But tech, telecom, oil and gas and health care shares moved higher.

The index on Tuesday rose 0.5% (http://www.marketwatch.com/story/european-stocks-rise-to-2016-high-as-italian-banks-swing-higher-2016-12-20) to 361.32, closing at its highest level since December last year. That push came with help from Italian banks on news the Italian government was preparing a bailout package for struggling lenders.

The FTSE Italia All-Share Banks index fell 0.6%. Shares of Banca Monte dei Paschi di Siena SpA (BMPS.MI) dropped 17% off the Stoxx 600, following a report the embattled Italian lender's liquidity could be wiped out sooner than anticipated.

The bank now expects to run out of liquidity in four months, compared with a previous estimate of 11 months, Reuters reported, citing BMPS documents. The bank's current net liquidity position is 10.6 billion euros ($11.02 billion).

Other Italian banks were down, with Mediabanca SpA (MB.MI) giving up 1%, Banco Popolare Societa Cooperativa (BP.MI) off 0.7% and Intensa Sanpaolo SpA (ISP.MI) down 0.7%. UniCredit SpA (UCG.MI) , however, was up 0.4%.

Spanish banks: Meanwhile, Spanish bank stocks fell after the European Union's top court reportedly lost a case over mortgage interest repayments. The ruling may lead to banks having to give back billions of euros to mortgage customers, Bloomberg reported. Banco Popular Espanol SA (POP.MC) dropped 4.4%, Banco Bilboa Vizcaya Argentaria (BBVA) fell 1.5%, and CaixaBank SA (CABK.MC) lost 3.5%.

Meanwhile, the Swiss Competition Commission on Wednesday said it has fined (http://www.marketwatch.com/story/switzerland-fines-banks-963-mln-for-rate-rigging-2016-12-21) some lenders a total of about 99 million Swiss francs ($96.3 million) in its probes into rigging of rates and related products.

The regulator COMCO said in a statement it had reached an "amicable settlement" with RBS, Barclays, Deutsche Bank and Société Générale over their participation in the Euribor cartel. RBS and Barclays also settled investigations into cartels to manipulate Yen Libor, Swiss franc interest rate derivative pricing and the Swiss franc Libor benchmark rate.

Shares in Deutsche Bank AG (DBK.XE) (DBK.XE) were up 1.5%, Societe Generale SA (GLE.FR) fell 0.5%, Royal Bank of Scotland (RBS.LN) (RBS.LN) rose 0.8% and Barclays (BCS) (BCS) shed 0.5%.

Indexes: Italy's FTSE MIB index fell 0.3% to 19,194.04 and Germany's DAX 30 index edged up 0.1% to 11,476.30. France's CAC 40 index was flat at 4,848.08.

The U.K.'s FTSE 100 index rose 0.2% to 7,054.15 (http://www.marketwatch.com/story/bank-stocks-rise-nudging-ftse-100-higher-2016-12-21).

(END) Dow Jones Newswires

December 21, 2016 05:26 ET (10:26 GMT)

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