The amount of cash deposited by commercial banks overnight with the European Central Bank spiked last week, ECB data showed yesterday, a sign that they may be increasingly reluctant to lend.

ECB data showed commercial banks parked €107.2 billion in the Bentral Bank’s deposit facility on Friday, up from €90.5 billion on Thursday.

While the amount remained well below the year-high of €145.2 billion in early August, it is nonetheless a substantial amount for banks to deposit at a rate of 0.75 per cent, which means they forego earnings rather than lend it to other banks at the current going rate of around 0.89 per cent.

According to Lena Kormileva, a strategist at Brown Brothers Harriman quoted by Dow Jones Newswires, the figure shows that “the ECB’s intermediation (in the money markets) remains broken.

“Banks are hoarding cash due to systemic risks,” which are expected to grow further, she argued.

On August 11, the ECB launched an exceptional six-month loan operation that saw 114 eurozone banks request a total of €49.8 billion.

However, pumping cash into interbank lending markets might not ease financing problems for those banks considered most at risk of being unable to repay their loans.