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Credit crunch jitters prompt financials to slump


Financial stocks have taken a battering this morning, dragged down by concerns about further problems emerging in the banking sector.

Northern Rock has led the slump, down a further 33 per cent after seeing a third of its value wiped out on Friday.

By lunchtime trading volumes in the companies shares had topped 174m, compared to an average trading volume of closer to 15m.

Alliance & Leicester, down 14 per cent, and Bradford & Bingley, down 11 per cent, were the next worse hit as investors took flight from lenders viewed as having funding models which will have to change in the current climate.

Paragon is down 6 per cent and banking giants HBOS and Royal Bank of Scotland down 4.8 per cent and 4.2 per cent, respectively. Barclays is down by 2.7 per cent.

Fund managers have also been dragged down with F&C, Aberdeen and Schroders all down by over 2 per cent.

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