Britain's leading FTSE 100 share index edged up yesterday, with banks forging higher after Barclays' results and dividend signalled the worst may be over for the stricken UK financial sector.

The FTSE 100 ended up 0.3 per cent, or 20.3 points at 5,966.9. Shares across Europe ended little changed as investors balanced the Barclays update with a shock write-down at Swiss bank Credit Suisse.

Barclays raised its write-down on the value of risky assets to £1.6 billion but its shares jumped 3.7 per cent on upbeat comments from management on a conference call as well as annual profit that met forecasts.

Barclays is the first major UK player to report earnings after a turbulent year and analysts said yesterday's numbers - including a modest £300 million increase in write-downs and a 10 per cent dividend increase - were good news for the sector.

"I feel fairly confident that the rest of the banks that are due to report will follow in Barclays' footsteps... in terms that there are no further losses to be reported beyond what they told us in December," said Edward Menashy, an economist at Charles Stanley.

"The fact that the bank felt confident enough to declare an increase in the dividend (has) really stabilised the situation."

Shares in Royal Bank of Scotland, Lloyds TSB and HBOS advanced between 1.6 and 3.1 per cent.

InterContinental Hotels soared 7.3 per cent after the world's largest hotelier met forecasts with an 18.5 per cent rise in annual profit.