Nervous banks park record sums at ECB

(FRANKFURT) - Crisis-hit eurozone banks parked a record 528.18 billion euros ($675.60 billion) overnight at the European Central Bank, data showed on Wednesday, suggesting the crucial interbank market is clogged.

Banks have been stashing record sums almost daily at the ultra-safe ECB, nervous of lending to each other, despite the fact they earn only a miserly 0.25 percent for their deposits at the central bank.

The previous record was published only on Tuesday, when banks parked 502 billion euros overnight.

The phenomenon appears particularly significant because it comes after eurozone banks borrowed nearly half a trillion euros from the ECB last month via a brand new three-year lending facility.

ECB chief Mario Draghi has insisted that the facility is indeed working to unlock the interbank market, saying recently that the institutions that took funds from the lending programme are not the same ones handing it back.