European shares ended slightly lower on Thursday, weighed by financials after the region's top two central banks kept rates on hold as expected and investors saw little to suggest euro zone borrowing costs would fall soon.
The pan-European FTSEurofirst 300 benchmark ended unofficially down 0.2 percent at 1,359.37 points, with banks taking the most points off the index, tracking U.S. peers that fell after regulators urged increased government oversight of investment banks.
Swiss bank UBS fell 5.1 percent, while Societe Generale lost 2.5 percent and Barclays slipped 2.9 percent.
Italy's UniCredit fell 2.9 percent after saying that profit might fall this year and that its capital strength weakened in the first quarter.
And Austrian bank Raiffeisen tumbled 7.7 percent to top European losers after its first-quarter earnings disappointed investors.
But mining stocks rose sharply on consolidation talk, with Kazakhmys jumping nearly 10 percent on renewed speculation of a bid from ENRC, which declined to comment.
Earlier, the Bank of England kept rates at 5 percent and the European Central Bank stayed at 4 percent, as expected.
ECB President Jean-Claude Trichet said that the bank's current policy stance would help it achieve price stability, although inflation was likely to remain high for some time amid turbulent markets.
"The ECB will need to see more of a slowdown in the economy for the next months before it lowers rates, and we expect this to happen in the beginning of fall or end of summer," said Thierry Lacraz, strategist at Swiss bank Pictet.
"The main factor behind this is the development of the oil price, and the bank will have to decide whether...to have a tough policy to fight inflation that is not due to internal factors such as wages," he said.