FTSE closes 1.6 pct down; commodities, banks weigh

* FTSE 100 closes 1.6 pct lower

* Oils and miners slip on weaker commodities prices

* British Energy jumps on takeover talk

By Atul Prakash

LONDON, July 24 (Reuters) - Britain's blue-chip index closed 1.6 percent lower on Thursday as oils and miners tracked softer commodity prices and, along with falling banks, outweighed gains in British Energy (BGY.L: Quote, Profile, Research, Stock Buzz) and Kingfisher (KGF.L: Quote, Profile, Research, Stock Buzz).

The FTSE 100 .FTSE ended down 87.6 points at 5,362.3, after rising 1.6 percent on Wednesday. The benchmark index has fallen 17 percent this year, against an average yearly gain of more than 10 percent in the previous five years.

Banks slipped after early gains on a smaller-than-expected fall in the earnings of Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz), as concerns about global economic growth and financial stress continued to dampen market sentiment.

Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz), Barclays (BARC.L: Quote, Profile, Research, Stock Buzz), HBOS (HBOS.L: Quote, Profile, Research, Stock Buzz), HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz), Lloyds TSB (LLOY.L: Quote, Profile, Research, Stock Buzz) and Standard Chartered (STAN.L: Quote, Profile, Research, Stock Buzz) fell between 0.6 and 2.5 percent.