European shares fell on Monday after Greece and its private creditors failed to come up with an agreement on debt swap talks, needed to avoid a messy default, before the start of a European summit focused on growth and the region's debt crisis.

Banking stocks, many of which have exposure to euro zone peripheral debt, were the worst performers, with the STOXX Europe 600 Banks index <.SX7P> down 1.6 percent.

It is all pretty negative, Greece is still trying to get a deal and there are worries about contagion, said Joe Rundle, head of trading at ETX Capital.

Euro zone leaders still need to come up with a solution and all the negative news is not good for consumer confidence and could lead to a snowball effect, spending could slow down and hit company earnings.

At 8:05 a.m., the FTSEurofirst 300 <.FTEU3> index of top European shares was down 0.6 percent at 1,034.16 points.

(Reporting by Joanne Frearson)