European shares dropped to a three-and-a-half year closing low on Monday, amid persistent worries about the health of the financial industry.
The FTSEurofirst 300 index of leading European shares ended down 5.23% at 1,047.04 points - its lowest closing level since 24 January, 2005. The index is down around 27% this year,
In London, the FTSE index of leading shares lost 5.3% to 4,818.77 points. In Paris, the CAC 40 tumbled 5.04% to 3,953.48 points and in Frankfurt the DAX shed 4.23% at 5,807.08 points.
Belgian-Dutch banking and insurance group Fortis sealed a multinational bail-out over the weekend while the British government took over troubled mortgage lender Bradford & Bingley on Monday.
German authorities joined a consortium of banks to rescue stricken property lender Hypo Real Estate.
In the United States: Citigroup agreed to take over the banking operations of Wachovia.
Morgan Stanley raised capital to shore up its balance sheet with the sale of a 21% equity stake to Japan's Mitsubishi UFJ Financial Group Inc for $US9 billion.
US Treasury debt prices soared as cash poured into the market looking for a safe haven. The benchmark 10-year Treasury was up more than 1.5 points in price, pushing the yield down to 3.67%.