European shares rise to seven-year high on hopes for a Greek deal

* FTSEurofirst 300 rises to set new seven-year high

* Greek shares lead gains, Athens to submit loan request

* Ct. Agricole rallies after profits beat forecasts

By Francesco Canepa

LONDON, Feb 18 (Reuters) - Greek stocks helped push a key pan-European equity index to a seven-year high on Wednesday, on expectations that Athens would reach an agreement with its international lenders.

Greek shares climbed 1 percent after Greece's government confirmed it would ask on Wednesday for an extension to its loan agreement with the euro zone. Shares (Frankfurt: DI6.F - news) in Greek banks rose sharply.

The new Greek government had refused to seek an extension of a bailout by the European Union and International Monetary Fund, which is due to expire on Feb. 28, because of the austerity policies the bailout imposes. It also wants to renegotiate Greece's debts separately.

The pan-European FTSEurofirst 300 index rose 0.5 percent to 1,512.74 points going into the middle of the trading session, its highest since early 2008.

The euro zone's blue-chip Euro STOXX 50 index also rose 0.6 percent. Germany's DAX rose by a similar amount to put it near the DAX's earlier record highs.

Greek banks such as Piraeus and National Bank (NYSE: NBHC - news) of Greece were among the best performers on the FTSEurofirst 300, rising 7.7 and 5.1 percent respectively.

"While the political situation in Greece remains volatile, the economic and financial situation is more under control," said Andreas Clenow, hedge fund trader at ACIES Asset Management. "I still see a bull market on stocks, and I have been buying into weakness on the Euro STOXX."

PERIPHERY OUTPERFORMS

Shares in Italy and Spain, whose economies face debt pressure similar to Greece's, outperformed. Italy's FTSE MIB rose 1.3 percent and Spain's Ibex advanced 0.9 percent.

Italian oil and gas group Eni (LSE: 0N9S.L - news) provided further support to the Milan market. Its shares rose 2.8 percent after ENI reassured investors with a small dividend increase and pledged to cut capital spending after lower oil prices depressed fourth-quarter profit.

European banking stocks were also boosted by French lender Credit Agricole, which posted profits that beat market forecasts. Its shares gained 6.2 percent.

Shares in French conglomerate Bollore (LSE: 0IXZ.L - news) rose 3.2 percent after Carson Block, the head of investment research firm Muddy Waters, forecast solid gains for Bollore shares.

Around 58 percent of European companies that have reported results so far have met or beaten consensus forecasts, according to Thomson Reuters StarMine data.

Europe bourses in 2015: http://link.reuters.com/pap87v

Asset performance in 2015: http://link.reuters.com/gap87v

Today's European research round-up (Additional reporting by Sudip Kar-Gupta; Editing by Larry King)