UPDATE 1-Banks meet NY Fed for pay rules -- sources

* About 20 bank executives participated in 30 min session

* Banks told to be disciplined on comp, consider risk

* Morgan Stanley CEO asked for regulator coordination

By Steve Eder

NEW YORK, Nov 2 (Reuters) - The Federal Reserve Bank of New York huddled with leaders of about 20 major banks on Monday to discuss proposed rules designed to tie pay to performance and curb excessive risk-taking, sources familiar with the meeting said.

The Fed told the bank executives it is serious about its executive compensation rules and wants banks to begin incorporating them in year-end compensation plans, the sources said.

William Dudley, the head of the New York Fed, participated in the meeting, telling the executives they must figure out how to compensate risk-takers while being disciplined on compensation, a source said. The Fed also asked for feedback on its proposed rules.

Bank CEOs, who were on hand for the half-hour meeting with members of their compensation committees, also had opportunities to ask questions or offer comments.

Morgan Stanley CEO John Mack took the opportunity to stress the need for global coordination among regulators on pay issues.

"Everyone agreed and Dudley said 'that's a good point and we will focus on it,'" a source said.

Top executives from Goldman Sachs Group Inc (GS.N), JPMorgan Chase & Co (JPM.N), Bank of New York Mellon (BK.N) and Credit Suisse Group AG (CSGN.VX) were among those participating, a source said.

(Reporting by Steve Eder and Kristina Cooke; editing by Leslie Gevirtz and Andre Grenon)