A Deutsche Bank logo adorns a wall at the company's headquarters in Frankfurt, Germany June 9, 2015.
A Deutsche Bank logo adorns a wall at the company's headquarters in Frankfurt, Germany June 9, 2015. Reuters / Ralph Orlowski

Europe's financial sector scrambled on Thursday after Russia invaded Ukraine, with Allianz saying it had frozen its Russian government bond exposure and top British domestic lender Lloyds saying it was on "heightened alert" for cyberattacks.

Deutsche Bank said it had contingency plans in place.

Shares of leading banks sank at the start of trade. An index of European banking stocks <.SX7P> was down 4.2% in early trade, steeper than a 3% fall in the Euro Stoxx index.

Banks with significant operations in Russia were particularly hard hit, with Austria's Raiffeisen Bank International down 9%, while UniCredit and Societe Generale fell 5%.

Earlier Thursday, Russian forces fired missiles at several cities in Ukraine and landed troops on its coast, officials and media said, after President Vladimir Putin authorised what he called a special military operation in the east.

European banks are the world's most exposed to Russia - especially those in France, Italy and Spain, which far outstrip U.S. bank exposure, data from the Bank for International Settlements shows.

German regulator BaFin said it was keeping a watchful eye on the crisis.

Both Deutsche Bank and Allianz - two of Europe's most important financial firms and both with operations in Russia - said they were ready to comply with sanctions.

Allianz, one of the world's asset managers, said that the share of Russian government bonds in its portfolio was "currently very low" and that it had recently implemented a freeze on those securities in its portfolio.

Deutsche Bank, like many lenders in recent years, has reduced its presence in Russia as sanctions on the country have expanded.

"We have contingency plans in place," the bank said in a statement. A spokesperson declined to elaborate.

Lloyds CEO Charlie Nunn told reporters that it was on "heightened alert... internally around our cyber risk controls and we've been focused on this for quite a while".

Preparation for potential cyberattacks was discussed in a meeting between the government and banking industry leaders about Russia on Wednesday, Nunn added.

Lloyds has been on heightened alert for the "last couple of months", Nunn said.