Banking stocks fell sharply Tuesday after Treasury Secretary Timothy Geithner urged lawmakers to implement a $90 billion tax on the largest financial institutions.

European debt concerns also weighed on the sector, with the KBW Bank Index falling 2.96% to 54.99.

Most large and midsize banks closed lower after Geithner told the Senate Finance Committee that banks should pay the so-called financial crisis responsibility fee to help recoup the cost of the 2008 bailout.

The tax is unpopular with bank executives and advocacy groups. They note that most large lenders have already repaid their federal aid with interest and argue that banks would past the cost of the fee onto consumers.

Fears that Greek’s debt crisis would spread to other European countries also weighed on banking stocks and the broader markets.

The Dow Jones Industrial Average fell 2.02% ad the S&P 500 Index fell 2.38%.

JPMorgan Chase & Co. fell 2.44%; Bank of America Corp. 2.77%; Wells Fargo & Co. 2.77% and Citigroup Inc. fell 15 cents, to $3.40.

Keycorp fell 3.89%; Fifth Third Bancorp, 5.21%; PNC Financial Services Group Inc., 3.08%; SunTrust Banks Inc., 4.24%; and U.S. Bancorp, 2.65%.

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