Bottom view of Deutsche Bank Twin Towers in the central business district of Frankfurt am Main, Germany. BY canadastock @

European banks are experiencing a bit of turmoil, and it looks like Deutsche Bank is the next victim. Martha Muir, Katie Martin, and Sam Fleming report in the Financial Times:

Bank stocks took a heavy hit on Friday, with Deutsche Bank falling 10 per cent, as policymakers struggled to calm nerves after failures on both sides of the Atlantic.

The Stoxx 600 banks index, which contains Europe’s biggest lenders, fell 3.6 per cent by mid-afternoon, outstripping weakness in broad national indices. Germany’s Commerzbank fell 5 per cent while France’s Société Générale lost 5.6 per cent.

“Europe is very tilted towards banks, which have been in the eye of the storm ,” said Emmanuel Cau, head of European equity strategy at Barclays. “There are bank-specific issues to worry about like regulation and deposit safety.”

US banks were also under pressure at the Wall Street open, with the KBW Banking index down 0.9 per cent, and troubled regional lender First Republic Bank falling 0.9 per cent.

Broader markets were dragged down by the renewed banking sector turmoil, with the Euro Stoxx 600 down 1.5 per cent, Germany’s Dax down 1.8 per cent, France’s Cac 40 down 2 per cent and London’s FTSE 1.5 per cent lower.

In the US, the S&P 500 fell 0.5 per cent in early trade, while the tech-heavy Nasdaq Composite dropped 0.6 per cent.

Deutsche Bank’s 9.9 per cent slide came after a surge this week in the cost of insuring the lender’s debt against default.

Read more here.