By Andrea Shalal and Thomas Escritt

BERLIN/AMSTERDAM(Reuters) - A European counter-terrorism intelligence database designed to generate greater intelligence sharing among allies to avert deadly Islamist attacks has gone online after overcoming traditional reluctance by spy agencies to sharing information.

European officials were spurred into setting up the project by the Paris attacks last November by Islamist militants which exposed intelligence gaps. A total of 130 people were killed in those attacks.

Hosted by the Dutch intelligence service in the Hague, the database went live on July 1, the German Interior Ministry and the German domestic intelligence agency (BfV) said.

"The intelligence database will make it much easier and quicker to share information about possible threats," said one intelligence official.

The database enables European intelligence agencies to share real-time information about suspected Islamist militants collected by members of the Counter-Terrorism Group (CTG), which groups all 28 European Union countries, Switzerland and Norway.

Its creation marks a step forward in the fight against Islamic State, which is focused increasingly on orchestrating large-scale and "lone wolf" attacks as it suffers setbacks and loses territory in Iraq and Syria.

"We need a close exchange of information that is rapid and comprehensive, based on the relevant legal and privacy regulations," said one official at the German interior ministry.

A refinement of earlier databases, the new system is designed to make it easier to cross-reference material provided by different countries’ security services, a Dutch security services official told Reuters.

"If we see one of our targets traveling to Amsterdam, we haven't been checking until now if his brother or nephew is also traveling," the official said, giving an illustration of the way the new database worked.

European police agencies have long shared information about potential criminals through Europol and Interpol, but spy agencies are generally reluctant to share intelligence data, except on a specific case-by-case or bilateral basis.

Lack of cooperation was a focal point after the Paris attacks. Several of those involved in the attacks had been on the radar of authorities in other countries.

Abdelhamid Abaaoud, suspected mastermind behind the Paris attacks, for instance, had mocked European frontier controls and boasted how easy it was for him to move between Syria to his Belgian homeland and the rest of Europe.

In another case, the former French spy Claude Moniquet has been quoted as saying that France did not pass on information about Mehdi Nemmouche, a French-Algerian dual national, who shot four people at the Jewish Museum in Brussels in 2014.

After Abdesalam's arrest, U.S. officials privately disparaged European intelligence-gathering and said they were working closely with European authorities to ensure they had the training needed to prevent another Paris-style attack.

The Netherlands, which held the rotating EU presidency at the time, played a key role in setting up the database. Dutch officials urged global counter-terrorism officials to agree to greater sharing of banking details and key data about potential militants after missed signals in Paris.

In the past, they said, countries often failed to share lists of suspects whose assets had been frozen, making it possible for someone blacklisted in one country to drive across the border and use their bank cards in a neighboring country.

(Editing by Richard Balmforth)