Britain's FTSE snaps losing streak as banks rise

* UK blue chip index up 0.3 pct at close

* Financials give biggest boost to FTSE

* Oil price helps energy shares

* Investors await BoE (Shenzhen: 000725.SZ - news) report on Tuesday (Adds detail, updates prices at close)

By Danilo Masoni and Kit Rees

LONDON, June 26 (Reuters) - British shares rose on Monday, snapping four straight days of losses, as banks joined a broader European rally and steadier crude oil prices supported energy firms.

The blue chip FTSE index was up 0.3 percent at 7,446.80 points at its close, paring back its earlier gains slightly as energy shares eased.

Financials provided the biggest boost to the FTSE, adding 11.5 points to the index, with heavyweight banks HSBC and Barclays (LSE: BARC.L - news) both up 1.2 percent.

Banking stocks were in demand in Europe after a deal to wind up two failed Italian regional lenders.

While earlier gains among oil majors BP and Royal Dutch Shell helped underpin the market, both heavyweights saw gains ease as the price of oil steadied. "Gains in (the) energy sector remain fragile as oil prices remain relatively soft compared to last month's levels," Ipek Ozkardeskaya, senior market analyst at London Capital Group, said.

She (Munich: SOQ.MU - news) said investors were also awaiting for the Bank of England Financial Stability Report and Governor Mark Carney's speech on Tuesday for clues about any possible hike in interest rates as inflationary pressures rise.

The news that British Prime Minister Theresa May had struck a deal with Northern Ireland's Democratic Unionist Party had little impact on the internationally facing FTSE 100 index, though sterling ticked higher.

While a drop among materials stocks weighed on British mid caps, which ended the session flat, outsourcer Capita (Taiwan OTC: T1614Y.TWO - news) was among standout movers. Its shares rose 2 percent after agreeing to sell its asset management services arm in a 888 million pounds deal that Jefferies said should help subside balance sheet concerns.

Back on the FTSE, subprime lender Provident Financial (Other OTC: FPLPF - news) fell 1.7 percent as RBC downgraded the stock to "Sector Perform" from "Outperform" following last week's profit warning.

On the up were Nestle (Swiss: NESN.VX - news) rivals Unilever (NYSE: UL - news) and Diageo (LSE: DGE.L - news) , as the sector was lifted after activist investor Daniel Loeb's Third Point urged the Swiss food giant to improve its margins, buy back stock and sell non-core assets.

Top losers were precious metal miners Fresnillo (Frankfurt: A0MVZE - news) and Randgold, which declined 3.1 and 1.5 percent respectively after gold prices fell as investors remained cautious ahead of a flurry of U.S. data due this week. (Reporting by Danilo Masoni and Kit Rees; Editing by Alison Williams)