NEW YORK (

TheStreet

) --

The Federal Reserve Bank of New York

has been intensifying its scrutiny of the U.S. units of Europe's biggest banks because of growing worries Europe's debt crisis could spill into the U.S. banking system, people familiar with the matter told

The Wall Street Journal

.

The New York Fed, which oversees the U.S. operations of many large European banks, is demanding more information from the banks about whether they have reliable access to the funds needed to operate day-to-day in the U.S. In some cases, the New York Fed is pushing the banks to overhaul their U.S. structures, the

Journal

reported.

New York Fed officials "are very concerned" about European banks facing funding difficulties in the U.S., a senior executive at a major European bank who has participated in the talks told the newspaper.

Fed officials recently held meetings with U.S.-based executives from top European banks to discuss their funding positions, according to the people familiar with the matter, the

Journal

said.

Some of Europe's biggest banks, such as France's

Societe Generale

, Germany's

Deutsche Bank

(DB) - Get Report

and Italy's

UniCredit

, have major operations in the U.S. and rely heavily on borrowed funds to finance those operations. There is no indication that regulators are focused in particular on those banks, the

Journal

said.

The New York Fed also has been coordinating with New York's superintendent of financial services, Benjamin Lawsky, to monitor the foreign banks' funding positions, the newspaper said.

Regulators are trying to guard against the possibility European banks that encounter trouble could siphon funds out of their U.S. units, the people told the

Journal

. Regulators recently have ramped up pressure on European banks to transform their U.S. businesses into self-financed organizations that are better insulated from problems with their parent companies, a senior bank executive said.

-- Written by Joseph Woelfel

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Joseph Woelfel

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