Shares in British banks were broadly up on the FTSE 100 in morning trading following the release of the Independent Commission on Banking's (ICB) interim report.

The ICB was set up by the Coalition government and is due to give its final report in September.

In its interim report today the ICB called for the "ring-fencing" of retail banks from investment banks, but notably not the splitting or breaking up of Britain's largest banks.

The ICB also recommended higher capital reserve requirements of banks and the sell off of more of Lloyds Banking Groups branches, in a bid to improve competition in the retail banking market.

Banking shares rose following the interim report, perhaps on expectations that any real reform of the sector is unlikely to be effective unless it can be pushed internationally.

By 09:40 shares in Lloyds Banking Group were up 0.72 per cent to 62.61 pence per share, RBS shares increased 2.49 per cent to 44.51 pence per share and Barclays shares rose 3.28 per cent to 306.90 pence per share.

However HSBC shares declined 0.24 per cent to 663.10 pence per share.

Overall the FTSE 100 was down 0.07 per cent to 6,051.43.