LONDON - No specific proposals have been tabled for Britain's banks to get involved in any private sector deal regarding Greece's debt problems, the UK Treasury said on Sunday.

The Observer newspaper had reported the government wanted British banks to take losses on their Greek bonds as part of a Europe-wide plan to prevent Greece's debt problems spiralling into a wider financial crisis.

"HM Treasury is monitoring the situation closely, but no specific proposals for private sector involvement have been tabled," said a Treasury spokeswoman.

Britain's "Big Four" banks -- Lloyds , Barclays, Royal Bank of Scotland and HSBC -- have a relatively small exposure to Greece. They have a larger exposure to other struggling eurozone economies such as Ireland and Spain.