Britain's biggest banks in £2bn crash over Spain fears

UP to £2billion was wiped off the value of Britain’s biggest bank yesterday amid worries over Spain’s ailing finances. Lloyds Banking Group lost nearly 4% of its value, while Royal Bank of Scotland shed more than 4% and Barclays fell by almost 2%. Traders were troubled by events in Spain, where the government’s borrowing costs creep towards unsustainable levels and there are fears the struggling country will need an EU bailout. Rupert Osbourne, futures dealer at IG Index, said: “Spain is very much front and centre for global markets. “If there is one thing that we have learnt from the past couple of years of European debt, it is that these problems tend not to be resolved quickly and painlessly.” The yield on Spain’s 10-year government bonds hit 6.1% – moving closer to the 7% which forced Greece, Ireland and Portugal to seek financial help from the EU.