According to new figures, the ECB agreed to lend banks â¬131.9 billion in three month loans, a figure which was lower than that anticipated by economic experts.
Many analysts anticipated that the amount would be between â¬150 and â¬200 billion.
Up to 171 banks borrowed the funds at a flat rate of one per cent over the period.
Gilles Moec, an economist at Deutsche Bank, told the Daily Telegraph: "It's definitely a good sign and means there is still some interbank lending occurring within the European money market.
Reports showed that the value of the euro against the pound rose following the news.
Meanwhile, many banks will repay their part of a 12 month loan worth â¬442 billion to the ECB later this week.
The funds were offered to ailing institutions as part of a special programme to help them stay afloat following the global credit crisis.
By Jim Ottewill