#USBankingCreditRisk clutch of bad loans at banks in recent weeks has shaken investor confidence in banking shares, which gyrated sharply late this week as unease mounted over credit risks that threatened to spill into the broader markets.

The markets have weathered a string of credit scares and surprise write-downs over the past two years, but sentiment took a particularly hard knock in recent days from auto bankruptcies and alleged fraud that resulted in losses at several banks.