Shares in British banks were broadly up on the FTSE 100 in morning trading after the outgoing chairman of French bank BNP Paribas warned against over-regulation of the banking industry in Britain.

Michel Pebereau, speaking to the Financial Times yesterday, said that London risked losing its status as a world leading financial centre if the government continues to over-regulate and over-tax the banks.

By 09:30 shares in Lloyds Banking Group were up 0.51 per cent to 54.82 pence per share, RBS shares rose 0.47 per cent to 42.62 pence per share and Barclays shares increased 0.38 per cent to 280.10 pence per share.

However HSBC saw its shares fall 0.37 per cent to 643.70 pence per share.

Overall the FTSE 100 dropped 0.99 per cent to 5,916.88.