European shares soared to their highest close in 12 weeks Thursday, with banks surging, after European Union leaders struck a deal to help resolve the euro zone debt crisis, reassuring investors.

The STOXX Europe 600 Banking Index <.SX7P> rose 8.9 percent.

French banks, heavily exposed to euro zone peripheral debt, were among the biggest gainers. They had suffered in recent months, on worries that a Greek default would result in a banking crisis. BNP Paribas and Credit Agricole rose 17.3 and 22.7 percent respectively.

The FTSEurofirst 300 <.FTEU3> index of top European shares ended the session provisionally up 3.6 percent at 1,018.67 points, the highest close since August 3.

Decisions have been made, whatever they are, and that's a good thing. I fear further down the road we'll find they're not as good as we thought, said Gavin Launder, fund manager at Legal & General, which has 356 billion pounds under management.

(Reporting by Brian Gorman)