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Belgian bank Dexia fell 3.4 per cent on Friday at the end of another choppy week for the region’s financial sector.

A week ago brokers thought the bank was out of the woods after the completion of a restructuring agreement with the European Union, but the gradual unveiling of the deal’s details has caused some to backtrack.


Evolution Securities was one of the brokers to switch stance. After initially saying it saw “upside risk” to Dexia’s share price, it downgraded the lender from “market perform” to “underperform”.

Morgan Stanley reiterated its “underweight” rating and lowered the bank’s price target from €4.70 to €4.50, citing the higher-than-expected restructuring costs and concerns Dexia would be unable to achieve “normalised earnings”.

The broker said: “We need more visibility on the level of normalised earnings the group can achieve (excluding support of government) and, more importantly, when this can be achieved.”

Dexia fell 2.4 per cent over the week to €3.93, bringing its total decline since the start of the month to 12.5 per cent.

Greek banks had a mixed week but largely ended higher after news that EU countries would stand behind Greece if its financial woes deepened. Piraeus Bank rose 3.9 per cent over the week to €5.77 and Alpha Bank added 4.7 per cent to €6.60, but EFG Eurobank slipped 0.7 per cent to €5.50 and National Bank of Greece dropped 3.9 per cent to €13.55.

In Dublin, Irish Life & Permanent plunged 11.6 per cent to €2.74 but Allied Irish Banks rebounded 1.7 per cent to €1.11.

Portugal’s largest listed bank, Banco Comercial Portugues, climbed 7.1 per cent to €0.76 in Lisbon, in spite of sharp intraday losses at the end of the week.

Greece’s ASE general index has fallen more than 18 per cent from its year peak in early January, but rose 1.1 per cent this week. On Friday it slid 2.1 per cent to 1,899.42.

The FTSE Eurofirst 300 dropped 0.3 per cent to 992.74, clipping its weekly advance to 1.6 per cent. The CAC 40 in Paris was 1 per cent higher for the week at 3,599.07, while Germany’s Xetra Dax climbed 1.2 per cent to 5,500.39 for its first weekly gain in more than a month.

The renewable energy sector posted fresh losses yesterday, after Alpha­Value, the broker, said companies such as Norway’s Renewable Energy Corporation could see their shares fall as governments cut back on solar subsidies.

A profit warning sent shares in REC 19.9 per cent lower on Wednesday, leaving the stock down 24.1 per cent on the week at NKr24.65. Vestas Wind in Denmark dropped 1.6 per cent to DKr270.40 over the week, while Germany’s Solarworld fell 6.9 per cent to €11.16.