RBS, L&G and Aviva all fall between 6% and 7.8%
The FTSE 100 had its biggest daily fall since March, with Royal Bank of Scotland (RBS), Legal & general (L&G) and Aviva all sliding, the FT and others report.
RBS fell 7.8% to 33p after Goldman Sachs cut forecasts to reflect higher loan losses and said it would not to return to normal earnings until 2013.
Changes to the government's asset protection scheme announced this month would lead to higher impairments and delay an earnings recoveryteh FT reported.
Goldman valued RBS stock at 78p on a four-year view but advised clients against buying.
Insurance sector review
L&G fell 7.4% to 78.5p after Citigroup moved to "sell" in an insurance sector review. L&G was "grappling with the strategic challenge of being mainly a one-product player in an overpenetrated market", said the broker.
The Guardian quoted analyst Raghu Hariharan saying: “The combination of a full valuation, inadequate diversification, and regulatory risks around its main annuity product line, high risky asset leverage and operational risks around the strategic shift to savings products drives our new sell recommendation.
“The company has recently been the subject of bid speculation but we believe that an acquisition is unlikely unless the regulatory risks around capital are fully known. This is not expected to be clarified till mid-2010”
The Times said Aviva, whose chief executive, Andrew Moss, is meeting investors in Edinburgh, fell 23.5p (6%) to 371.5p.
