Banking stocks tumble as US credit worries jolt investors

Group 1 - European and Asian financial stocks experienced a decline following a drop in U.S. regional banking shares due to concerns over mounting risks and credit quality [1][2] - European banks fell by 2.6% in early trading, with Deutsche Bank leading the decline at 5.8%, followed by Barclays at 5% and Societe Generale at 4.35% [2] - The U.S. regional banking index decreased by 6% as two small banks reported separate issues, indicating potential vulnerabilities in the sector [2][3] Group 2 - Zions Bancorporation announced a $50 million loss on two commercial and industrial loans, while Western Alliance initiated a lawsuit alleging fraud, raising concerns about lending standards [3][4] - Analysts noted that while these issues are not expected to pose systemic risks, they could negatively impact near-term sentiment in the financial sector [3] - The recent bankruptcies of U.S. auto parts supplier First Brands and car dealership Tricolor highlighted risks in the banking sector and the opaque credit market, prompting debt investors to reduce exposure to certain sectors [5]