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Barclays, Lloyds Banking Group, HSBC and Royal Bank of Scotland were all up by between 0.5 per cent and 1.5 per cent at 09:10 BST, Reuters reports.
As a result, the benchmark index added one per cent - or 52.49 points - taking it to 5,210.57 points.
News that debt problems in Dubai may be easing helped improve sentiment in the financial sector, while energy firms were also given a boost by a rise in the price of oil.
There were gains of between 0.7 per cent and 1.5 per cent for Royal Dutch Shell, BG Group and BP.
However, chief strategist for Brewin Dolphin Mike Lenhoff expressed caution, stating: "We are still in an environment that has been overwhelmed by a phase of volatility."
The FTSE 100 has recovered after falling yesterday, when stocks were hit by the new Germany has banned short selling on some financial products.
Posted by Chris Weaver
