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With European political worries driving the financial market on Monday, financial stocks including Bank of America Corp (NYSE:BAC) and Citigroup Inc. (NYSE:C) are especially taking a hard hit.

Both companies were off over three percent in morning trading with Bank of America Corp (NYSE:BAC) dropping to a one-month low; it has bounced back to over $8 per share and is just down just 1.5 percent. Citi shares also saw its own decline to $32.50 but also reversed course and is now trading over $33 per share.

The declines came amid unsettling news from Europe and its political leaders. First up was France’s Sunday presidential election.

President Nicolas Sarkozy came in at No. 2 for round one of voting.  This unnerved investors as Sarkozy has been an advocate for fixing financial problems in the Eurozone. Far-right candidate François Hollande received a surprising amount of support; he is making the markets nervous with his campaign pledges to increase government spending.

Just north of France in the the Netherlands, came news of the resignation from the prime minister and his cabinet after they did not obtain budget agreements. Budget talks had been going on for some time but came to a grinding stop this weekend thanks to the  Eurzone’s skeptic Geert Wilders leaving the lengthy discussions, saying they were sticking too closely to Eurozone rules and ultimately hurting the Dutch economy.

With the unsettled Netherlands, it will add additional stress for investors who will now worry if the country will meet its its 2013 projected budget and ultimately hit the EU target, according to Forbes.

The most recent woes are just one of many that have been affecting bank shares within the last month. Since March 26, Bank of America’s shares have dropped 16 percent while Citi has fallen 11 percent.

Rival JPMorgan Chase has fared better with its shares off  5.5 percent while Wells Fargo, with its smaller share of international business, has seen its shares drop 2.6 percent during the same time period.

Fitch Ratings Detailed Exposure

Back in November, Fitch Ratings released a report about the U.S banks and their direct exposure to the “stressed” European markets which had been defined as Greece, Ireland, Italy, Portugal and Spain. The group is also known as PIIGs.

The agency warned that “further contagion posed a serious risk to the banks.” The report noted that the big five banks– Bank of America, Citigroup, Goldman Sachs, Morgan Stanley and JP Morgan–had about $22 billion in hedges with these stressed markets, but Fitch expressed concern about their viability.

It also noted in the report, that these big banks also had a “cross-border outstandings to France” at $188 billion, which included $114 billion to French banks.

At the end of 2011, Citigroup said it had $20.2 billion of exposure to the five countries with $9.6 billion of “credit protection” on them; it had also put aside $4.2 billion of collateral to offset its total exposure, reported The New York Times.

Bank of America came in with less hedging at 12 percent of its $14.4 billion exposure offset through credit-default protection. In January, a Bank of America spokesman said, “We carefully manage our risk while still supporting our clients in Greece, Italy, Ireland, Portugal and Spain.”

Adding to the banks’ current unrest is earnings season. Results have been mixed for the first quarter numbers and many of the banks will take accounting charges in the quarter.

In a note by Raymond James Financial, Inc. (NYSE:RJF) analyst Anthony Polini on Monday, he wrote, “The 1Q12 reporting season has been about as good as can be expected, yet headwinds for revenue growth persist given the very low interest rate environment and weak economic recovery. Furthermore, the best news for this reporting season is likely behind us, and barring any positive economic data points, we expect the banks to trade sideways at best over the next few weeks.”