Paris - As evidence grew that the US finance crisis had reached Europe, French shares fell sharply in early trading on Monday, with banking shares leading the decline.

After one hour of trading on Monday, the Paris Bourse's benchmark CAC 40 was down 3.17 per cent, at 4,031.27, with slumping issues outpacing winners by 12 to 1.

The Franco-Belgian financial services group Dexia was the biggest loser, giving up nearly one-fourth of its value, as the Belgian government declared that it would come to its support as it had with the Fortis financial group.

French bank Credit Agricole was down more than 9 per cent, to 13.05 euros (18.71 dollars), with two more banks, BNP Paribas and Societe Generale off more than 7 per cent, at 63.08 and 60.46 euros, respectively. (dpa)