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Among the fallers was Lloyds Banking Group after it revealed that its recent acquisition, HBOS, would suffer an annual loss in profits of around £10 billion.
Alex Potter, a stock analyst at Collins Stewart, described Lloyds' unscheduled trading statement as "another black swan".
"Earlier this week, we wrote of our concerns about Barclays having posted relatively strong 2008 results but retaining a high-risk profile and weak capital levels," he commented.
Meanwhile, Royal Bank of Scotland shed nine per cent and Barclays dropped by 4.5p per share.
In related news, it has emerged that the government has banned executive bonuses in banks which are partly state-owned.
The news comes after David Cameron, the leader of the Conservative party, said he would cap all bonuses for 2008 at £2,000.
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