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By Bloomberg

Stocks in Europe declined, halting a three- day advance, as lenders fell and concern grew over negotiations between Greece and the European Central Bank.

The Stoxx Europe 600 Index dropped 0.2 percent to 371.32 at 1:08 p.m. in London, paring losses of as much as 0.6 percent. The ECB restricted loans to Greece, a decision that will raise financing costs for the nation’s banks and increase oversight by policy makers. The Greek ASE Index slid 2.8 percent.

Following the ECB’s move, the government in Athens held onto demands to end austerity. German Finance Minister said after a meeting with his Greek counterpart Yanis Varoufakis that they “agreed to disagree,” signaling no compromise. Optimism that Greece’s new government will soften its anti-austerity stance had sent the Stoxx 600 higher earlier this week, with the ASE posting its biggest three-day rally since 1991.

“The consequences of the current turmoil in Greece are extremely important,” said Pierre Mouton, who helps oversee $8 billion at Notz, Stucki & Cie. in Geneva. “Greece puts itself at the extreme of the spectrum, while the ECB stands at the opposite. Now it’s bargaining time and they should get closer as time goes by.”

The Stoxx 600 has still surged 8.4 percent this year after the ECB announced a bond-buying plan that included sovereign bonds. The volume of Stoxx 600 shares changing hands was 9.6 percent greater than the 30-day average, data compiled by Bloomberg show.

Earnings Reports

A gauge of banks contributed the most to losses among 19 industry groups in the Stoxx 600, with National Bank of Greece SA and Piraeus Bank SA plunging more than 6 percent.

UBS Group AG slipped 2.1 percent after people familiar with the matter said the U.S. is investigating whether the bank helped Americans evade taxes. BNP Paribas SA lost 4.1 percent as France’s largest bank said new rules and higher taxes will weigh on earnings, even as it posted a jump in quarterly profit.

Other stocks also moved after reporting earnings. Swatch Group AG fell 3 percent after the watchmaker failed to increase its dividend for the first time in five years amid a stronger Swiss franc. Full-year earnings also missed analysts’ estimates.

AstraZeneca Plc dropped 3.1 percent after reporting worse- than-estimated fourth-quarter results. Sanofi advanced 2.2 percent after the French drugmaker said profit will be “stable to slightly growing” this year. Daimler climbed 1.5 percent after predicting a significant increase in 2015 earnings. The German carmaker also posted fourth-quarter revenue and profit that beat analysts’ estimates.

Deal activity increased. BT Group Plc added 4.8 percent after agreeing to buy EE Ltd. for 12.5 billion pounds ($19 billion) from owners Orange SA and Deutsche Telekom AG.