LONDON, Sept 27 (Reuters) - European stocks reversed course mid-morning on Tuesday as weakness in banks, led by another drop to record lows for Deutsche Bank, once again weighed on markets.
The pan-European STOXX 600 index was down by 0.5 percent, a full percentage point lower from the day's highs.
The STOXX Europe 600 banks index was down 1 percent, while the euro zone bank index fell 1.4 percent.
Deutsche Bank hit new record lows, falling nearly 3 percent to extend losses following a 7.5 percent slump in its stock price on Monday, after Deutsche Bank said it had no need for German government help with a $14 billion U.S. demand to settle claims it missold mortgage-backed securities.
Elsewhere, Volkswagen shares slumped more than 4 percent on reports that Berlin was vetting a criminal fine would bankrupt the firm. (Reporting by Sudip Kar-Gupta, Editing by Vikram Subhedar)