A positive note issued by Citigroup elevated banks on Wednesday and helped ease the FTSE into positive territory.
The note, related to Lloyds Banking Group, the entity formed from the Government-backed merger of Lloyds TSB and HBOS, helped it soar more than 25% to 84p.
The sentiment also filtered down to benefit Barclays and RBS, up 8% and 7% respectively, while Legal & General, up 7%, and Aviva, up 8%, also made early strides.
Directors at Lloyds have shrugged off reports they sounded out shareholders about executive pay rises.
Shortly after 8.30am, the FTSE 100 had climbed more than 60 points, or 1.4%, to 4,254, its highest for two weeks.
However, miners were stunting gains, with Vedanta Resources and Xstrata both struggling.
In New York, better than expected corporate earnings eased major indices higher, with the S&P 500 up more than 1% to 845.7 and the Dow Jones up 0.7% to 8,174. Asian markets tracked Wall Street's advance.
Elsewhere, the pound continued to strengthen against the dollar - $1.4243 - and EURO - 93.16p.IFAonline
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