Shares in British banks were up on the FTSE 100 in morning trading ahead of stress test results due out tomorrow.

Under the tests banks are required to simulate what would happen to them should a doomsday scenario, like another credit crunch, strike, as a way of seeing if they have enough reserves to weather future storms.

Most major banks are expected to pass, thus improving investor confidence in banking shares.

By 10:25 shares in Lloyds Banking Group were up 2.62 per cent to 62.61 pence per share, RBS shares rose 0.13 per cent to 45.24 pence per share, Barclays shares increased 2.02 per cent to 297.90 pence per share and HSBC shares climbed 1.18 per cent to 645.50 pence per share.

Overall the FTSE 100 was up 0.58 per cent to 5,244.63.