Greek shares lead Europe lower after debt talks break down

* Greek shares down 4.6 pct after rescue talks collapse

* Euro STOXX 50 down 1.3 pct, FTSEurofirst 300 down 0.6 pct

* Danish jewellery maker Pandora (LSE: 0NQC.L - news) surges after earnings beat

By Francesco Canepa

LONDON, Feb 17 (Reuters) - Athens stocks led declines on

European share indexes on Tuesday after debt talks between

Greece and euro zone finance ministers broke down, putting the

country's future in the euro zone at risk.

The Athex index was down 4.6 percent by 0837 GMT,

with Greek banks down 9.3 percent.

Euro zone banks, which have a large exposure to the

region's sovereign debt market, shed 1.7 percent.

After the market close on Monday, Greece rejected a proposal

for a six-month extension of its international bailout package

as "unacceptable". Dutch Finance Minister Jeroen Dijsselbloem,

who chaired the meeting, said Athens had until Friday to request

an extension, otherwise the bailout would expire at the end of

the month.

"It's a big risk and the pressure is immense," said Joost

Van Leenders, chief economist of multi-asset solutions at BNP (Paris: FR0000131104 - news)

Paribas Investment Partners. "The parties have to move and the

room for manoeuvre is pretty small."

To protect itself from a Greece-related selloff in stocks,

BNP Paribas IP recently cut its "overweight" position in

equities to "neutral" and bought an option to sell the Euro

STOXX 50 index, Van Leenders said.

The Euro STOXX 50 was down 1.3 percent, while the

pan-European FTSEurofirst 300 index was down 0.6

percent at 1,493.77 points.

On the earnings front, Danish jewellery maker and retailer

Pandora surged 15 percent after it reported

fourth-quarter operating profit above expectations, and said its

profit margin will rise in 2015.

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

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

Today's European research round-up

($1 = 0.8817 euros)

(editing by John Stonestreet)