Banks, commodities help FTSE close 0.5 pct higher

* FTSE 100 closes 0.5 percent higher

* UK Banks extend gains after Bank of America results

* Oils, mining shares track commodity prices higher

By Atul Prakash

LONDON, July 21 (Reuters) - Britain's top share index closed 0.5 percent higher on Monday, as better-than-expected results from Bank of America (BAC.N: Quote, Profile, Research, Stock Buzz) helped UK banking stocks, while firm commodity prices gave a lift to oils and miners.

The commodity-heavy FTSE 100 .FTSE ended up 27.9 points at 5,404.3, after rising 0.5 percent last week, its first weekly advance in more than two months. But the benchmark index is down 16 percent so far this year.

Banks extended earlier gains after Bank of America figures showed profit fell less than expected, as improved investment banking and trading results offset a surge in bad loans.

Bank of America became the fourth of the nation's five largest banks to top earnings forecasts, joining Citigroup (C.N: Quote, Profile, Research, Stock Buzz), JPMorgan Chase (JPM.N: Quote, Profile, Research, Stock Buzz) and Wells Fargo (WFC.N: Quote, Profile, Research, Stock Buzz).