Part-nationalised bank Royal Bank of Scotland Group fell by 3.5 per cent to 43.35p as uncertainty over banking regulation continues.
 
The bank had been boosted last week by reports that it could exit the government's asset protection scheme earlier than planned.
 
Fresh uncertainty over the coalition government's plans for the banking sector were sparked following a speech by John Vickers, chairman of the Independent Commission on Banking late last week.

Vickers appeared to question whether banks should be broken up. However, this was then tempered by comments by deputy prime minister Nick Clegg, who called for further reform of the banking sector.

In a statement the British Bankers' Association welcomed the comments by Vickers, warning that any new regulation should be coordinated internationally.

Lloyds Banking Group also saw share price drop on uncertainty, falling by 2.7 per cent to 65.82p

Engineering and IT group Invensys dropped 2.7 per cent to 326p, after reports of a downgrade by analysts at Goldman Sachs.

Meanwhile, British American Tobacco was the strongest riser, up by 1.7 per cent to 2,320.5p. Guinness brewer Diageo also saw share price rise by 1.7 per cent to 1,224p and restaurant operator Whitbread saw share price increase by 1.6 per cent to 1,748p.