UK bank shares tumble after call for windfall tax on lenders in budget

Investor jitters follow report by IPPR, with stock market value of sector cut by almost 8bn in morning trading

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UK bank shares tumbled on Friday, cutting the stock market value of the sector by almost 8bn in morning trading, as fresh calls for a windfall tax on large lenders in the autumn budget spooked investors.

Calls for a tax grab, in a paper written by the Institute for Public Policy Research (IPPR) thinktank, took a toll on some of the UK's biggest high street banks. NatWest Group suffered the biggest drop on Friday morning, registering a decline of as much as 5% in its share price, while Lloyds Banking Group and Barclays followed close behind, falling 4.5% and 3.6% respectively. HSBC dropped more than 1%.