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European banks are stashing cash

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Commercial banks parked almost a half trillion euros at the European Central Bank (ECB), the highest on record, as the mix of debt crisis worries and a recent giant injection of ECB cash left banks awash with money but too scared to lend it, Reuters reported. Overnight deposits at the ECB have regularly hit new records in recent weeks after the central bank’s first-ever offering of three-year loans pumped 490 billion euros (about $620 billion) into the banking system. ECB data released today showed that overnight deposits reached a new high of 493 billion euros, up from the 490 billion they had risen to on Friday. The euro traded today at 1.2673 dollars per euro, MarketWatch said.