Bank shares suspended during FTSE rout

SHARES in Barclays and Standard Chartered were suspended yesterday during a day of carnage on the financial markets.

The two UK lenders saw their shares slump amid fresh concerns about the global economy and the strength of some of the world’s biggest banks.

Trading in Barclays was suspended for eight minutes while regulators checked for evidence of suspicious behaviour, such as insider trading, which could have driven wild swings in its market value.

Trading in Standard Chartered was also suspended briefly.

Barclays eventually closed down 5.3pc at 163.9p while emerging markets specialist Standard Chartered fell 5.7pc to 427p.

The move from the London Stock Exchange underlined the turmoil for banks on both sides of the Atlantic with Goldman Sachs and Morgan Stanley down more than 6pc in early trading. Royal Bank of Scotland fell 4.63pc to 230.7p, HSBC dropped 4.24pc to 438.45p, and Lloyds shed 3.95pc to finish at 59.36p.

But European bank stocks fared even worse, with Germany’s largest lender, Deutsche Bank, down 9.5pc amid concerns about its £5.3bn loss last year and the prospect of more huge losses to come. Analysts believe that fears about Deutsche’s future have had a knock-on effect on Barclays, with both lenders grappling with similar problems with their investment banks.

The sell-off came amid mounting fears over the strength of the global economy as China slows and other emerging market countries such as Russia, Brazil and South Africa continue to lurch from one crisis to another.

Official figures yesterday showed India’s economy grew by 7.5pc last year – faster than the 6.9pc growth seen in China. According to the IMF, this last happened in 1999.