Bank shares fall prey to malaise that struck London

MARKET REPORT -  Iseq: 5,967.16 ( -138.71):BANK SHARES tumbled yesterday, knocking more than 2 per cent off the Iseq index of Irish shares, as the malaise that struck London on Monday spread to the Irish market on its first day of trade after the long weekend.

However, dealers said the performance disguised a "bounce" from the depths plumbed by Irish stocks traded on the London market.

The Bradford Bingley crisis left investors fearing that bad debts at Bank of Ireland's UK business could be worse than expected.

The bank closed 56 cent or 6.87 per cent off at €7.59. At one point it was down by nearly 11 per cent. Volumes were strong with over eight million of its shares traded in Dublin.

Anglo Irish Bank suffered similarly, shedding 62 cent to close at €7.78, a fall of 7.38 per cent. Just over 5.3 million of the bank's shares were sold in Dublin. AIB fared better. It lost 32 cent or 2.48 per cent to end the day at €12.58.

Building materials giant CRH shed 70 cent to close at €23. Trades amounting to close to half a million shares contributed to the 2.95 per cent fall in value. However, dealers pointed out that these stocks have a dual listing in London, and their prices were actually ahead of Monday's closing values in the British capital. "There was actually plenty of buying interest around today," one observed.

Ryanair was the star performer, thanks to chief executive Michael O'Leary's promise to increase fares and cut costs to deal with the increase in oil prices.

The low-cost airline added 14 cent or 5.19 per cent to close at €2.84. The performance was its biggest rise in a month. Food group, Kerry gained 36 cent to close at €19.76, an increase of more than 1.8 per cent in its share price. Greencore and IAWS also made good gains yesterday.

Settlement date: June 6th