Italian stocks close down 3.30pc as bank shares fall

MILAN: Italy's stock market closed down 3.30 percent on Thursday, with banks dragging down shares after Banca Monte dei Paschi diSiena became the latest lender to unveil massive losses for 2011.

The benchmark FTSE Mib index inMilanfell to 15,908.85 points.

The worst performers were Banca Monte dei Paschi diSiena, Banca Popolare di Milano, Banca Popolare and UniCredit,Europe's largest bank.

Shares in Banca Monte dei Paschi diSiena, the world's oldest bank founded in the 15th century, plunged 10.69 percent to 0.3224 euros.

The only share price on the rise was aerospace and defence giant Finmeccanica, which gained 2.87 percent to 4.09 euros.

The market was also hit after the Organisation for Economic Cooperation and Development (OECD) inPariswarned the outlook forEuropewas "weak" and said the British, French and Italian economies would contract in the first quarter.

An Italian bond auction earlier on Thursday had however signalled an improvement in market confidence, with the Treasury raising 8.0 billion euros ($10.6 billion) in medium- and long-term debt at lower rates than before.