ECB funding demand surges as bank strains build
FRANKFURT/LONDON (Reuters) – Euro zone banks’ demand for central funding surged to a two-year high on Tuesday, and U.S. funds cut their lending to the bloc’s banks, tightening a squeeze that looks unlikely to ease this year. Fast-spreading sovereign debt worries have left lending markets virtually frozen and the European Central Bank as the only available funding option for many banks. The ECB’s weekly, limit-free handout of funding underscored the widespread problems, with 178 banks requesting 247 billion euros (213.1 billion pounds), the highest amount since mid-2009. …