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Jittery banks park cash at ECB

Nervous European banks parked just over €320bn at the European Central Bank’s overnight deposit facility, a new record that reflects heightened loan-loss and default fears spreading through the banking system. ECB data yesterday gave more evidence of steady increases in the funds that banks would rather store at the central bank than loan to other banks at higher rates available in the interbank money market, in which banks loan short-term funds to each other to help fund regular operations.