Shares in British banks were down on the FTSE 100 in morning trading after rating's agency Moody's suggested that Britain's triple A credit rating could be downgraded.

While Moody's said that it would not be cutting Britain's outlook from stable to negative, the agency said that if growth does not start to pick up a reassessment may be due.

In the first quarter of this year GDP growth was reported to be 0.5 per cent. However this followed a 0.5 per cent contraction in the final quarter of 2010, meaning that for the six month period there was effectively no growth.

Moody's added that pulling back on austerity measures could also lead to a reassessment of its outlook for Britain's credit rating.

The news appeared to do little to shares in risk sensitive banks.

By 09:30 shares in Lloyds Banking Group were down 1.02 per cent to 47.12 pence per share, RBS shares declined 1.47 per cent to 40.78 pence per share, Barclays shares fell 1.28 per cent to 259.20 pence per share and HSBC shares dropped 0.61 per cent to 619.40 pence per share.

Overall the FTSE 100 was down 0.92 per cent to 5,810.44.