New York - AFP
US bank shares plummeted Wednesday, leading a Wall Street rout amid worries about weak US economic growth and renewed fears over the Greek debt crisis. On the blue-chip Dow Jones Industrial Average, Bank of America, the biggest US bank by deposits, tumbled 11.1 percent to $6.76 around 1505 GMT. It was the most-traded stock on the New York Stock Exchange amid rising concerns about the Federal Reserve\'s dim outlook on the slowing economy. Citigroup shed 9.8 percent to $28.69, Wells Fargo dropped 7.3 percent to $22.97, Goldman Sachs fell 8.1 percent to $112.80 and Morgan Stanley was down 8.4 percent at $16.67. The Standard & Poor\'s banking shares index fell 7.3 percent. Peter Cardillo, at Rockwell Global Capital, linked the share price falls to \"the possibility that the Fed may do away with the interest on reserves,\" which he said is \"guaranteed income\" for banks.Such a move would likely be aimed at spurring banks to boost lending rather than hoarding reserves, in order to stimulate the economy. The Fed on Tuesday held its key interest rate unchanged near zero and vowed to keep exceptionally low rates \"at least through mid-2013,\" citing \"increased downside risks to the economic outlook.\" The central bank said it was reviewing the tools it has on hand to boost a slowing economy. Analysts said that European banks were dragged down after an announcement by Greece that cast doubt on its rescue plan and the situation for private creditors. Greece said Wednesday that its exchange of bonds under the debt rescue might include instruments with a life stretching slightly beyond the target date of 2020, and that the swap procedures had not yet begun.