NEW YORK (CNN/Money) - WorldCom Inc.'s lead bankers continued to debate whether they should lend the troubled telecom any more money and under what conditions, persons familiar with the situation told CNN/Money Friday.

A steering committee of nine banks, led by Citigroup and Deutsche Bank, held conference calls Thursday and Friday to discuss WorldCom's current woes and possible options.

WorldCom has drawn down on a $2.65 billion bank loan and the telecom had been in the process of extending that loan to $5 billion earlier this week. Its lenders -- which also include Bank of America and J.P. Morgan -- are trying to decide whether to give the troubled telecom any more money, the bankers said.

WorldCom has $1.6 billion in an undrawn credit facility that expires June 2006, as well as a $3.75 billion facility that expires at the end of this month. But the banks are not allowing WorldCom to access that money.

"In order for them to get more money they would have to verify their financial statements, which they cannot do," a different banking source said.

It will take some time for the banks to figure out what they will do; meanwhile, lenders await correct financial statements from WorldCom. The telecom said Wednesday that it has asked KPMG to conduct a comprehensive audit and, until then, will issue unaudited financial statements for 2001 and first-quarter 2002.

The banks must unanimously decide whether to extend the time WorldCom has to pay back any new loan. But the nation's No. 2 long-distance provider is still trying to figure out how much it needs, banking sources said.

The banks may consider lending WorldCom money if they can secure the loan with company assets, sources said. Also, the banks would be interested in offering debtor-in-possession financing that the company would use as it restructures.

But other banks are refusing to lend money unless WorldCom is in bankruptcy, a different source said. However, it is unclear how many of the banks are backing such a proposal.

"The creditors are only interested in maximizing the amount of money they get back," a third banking source familiar with the situation said. "It could be cutting their losses or extending a new loan right now."

Earlier this week, WorldCom rocked the financial world when it said it misstated $3.8 billion in expenses, which inflated its pretax earnings. WorldCom CEO John Sidgmore said Wednesday that company was taking numerous steps to ensure its survival, including selling assets and laying off 17,000 people.

WorldCom's lead bankers didn't find out about the misstatement until hours before the company made the accounting scandal public on Tuesday afternoon, one banking source said.

"It's a fact that WorldCom won't get an uncollateralized loan," the source said. "That is for sure."

Clinton, Miss.-based WorldCom on Thursday hired law firm Weil Gotshal & Manges and restructuring specialist the Blackstone Group to advise it on its options, sources familiar with the legal situation said. Weil, Gotshal specializes in bankrupt companies and is now advising Enron Corp. and Global Crossing as they restructure.

WorldCom has tapped Weil partner Jeffrey Weinberg, who specializes in mergers and acquisitions, and Marsha Goldstein, who focuses on restructuring issues, to represent the company in negotiations. The troubled telecom is now looking at all its options, which include selling assets, short-term financing and even bankruptcy, one industry observer told CNN/Money.

"Bankruptcy is always the last option," the source said.

Whether or not WorldCom files for bankruptcy will depend on what the banks decide, Rick Black, senior telecom analyst at Blaylock & Partners, said. The banks could opt to make WorldCom pay back the $2.6 billion loan, which means they would have to use the $2.3 billion in cash they have. The company's $30 billion in bonds would also be pushed into default if WorldCom must pay back the loan.

Since WorldCom doesn't have access to more money from the banks, it could face a "liquidity crisis," Black said.

But a loan, secured by WorldCom assets, could solve the company's financial needs for now. WorldCom may use its UUNET Group, a leading Internet backbone, to obtain a loan. The company could also offer its international operations and long distance network, Black said.

J.P. Morgan, Citigroup, Bank of America, Deutsche Bank and Blackstone each declined to comment. Weil Gotshal declined comment. WorldCom could not be reached for comment.