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• Failed Iceland bank sells Danish unit to Sweden

COPENHAGEN (AFP) - Shares in Eik Banki, the biggest bank in the Faroe Islands and Denmark's biggest online bank, fell more than 30 percent on Monday after the bank revealed talks with Danish officials on raising capital.

"Eik Banki and its Danish subsidiary Eik Bank Danmark have within recent days been in dialogue with the financial services authority (FSA)," the bank said on its website.

The talks were "in relation to an expectation that Eik Banki and Eik Bank Danmark will be required to make write downs and increase solvency requirements," the bank said.

"The Bank expects that already today and thus before 30 September 2010 requirements will be made which will necessitate injection of further capital of a substantial size in Eik Banki as well as in Eik Bank Danmark within a deadline decided by the FSA," it added.

In morning trading on the Copenhagen Stock Exchange, shares in the bank were down 31.25 percent to 44 Danish kroner.

Stock price was around 85 kroner last month.

Eik Banki has more than 50 percent of the banking market in The Faroe Islands, a Danish territory with 49,000 inhabitants about 650 kilometres (400 miles) off Scotland.

The bank also claims to be Denmark's biggest online banking group.

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