The Australian share market has closed more than two per cent lower, in a horror session weighed down by large losses by the banks.

At the close on Wednesday, the benchmark S&P/ASX200 index was 134.3 points, or 2.3 per cent, lower at 5,692.2, while the broader All Ordinaries index was down 125.3 points, or 2.15 per cent, at 5,690.9, according to preliminary figures.

On the ASX 24, the June share price index futures contract was 149 points lower at 5,658, with 37,837 contracts traded.