Shares in British banks were down on the FTSE 100 in morning trading as state-owned banks reportedly began preparing for asset sales.

A report in the Sunday Telegraph claimed that investment banks are currently finalising sale documents that will kick of the auction of £4.4 billion worth of assets belonging to fully nationalised bank Northern Rock, and partially nationalised Lloyds Banking Group.

In addition economic data on jobs in the U.S., released last Friday, proved disappointing, leading investors to once again fret about the state of the global economic recovery.

By 10:05 shares in Lloyds Banking Group were down 1.70 per cent to 47.90 pence per share, RBS shares fell 0.79 per cent to 41.21 pence per share, Barclays shares declined 1.32 per cent to 262.00 pence per share and HSBC shares decreased 0.61 per cent to 623.50 pence per share.

Overall the FTSE 100 was down 0.17 per cent to 5,845.23.