FRANKFURT, Germany – Struggling banks snapped up 489 billion euros ($639 billion) in cheap loans from the European Central Bank on Wednesday, a sign of just how hard or expensive it has become to borrow from each other.

The huge demand for newly available three-year loans comes as fears rise that heavily indebted European governments could default and force banks and other bond holders to take big losses.

The loans to 523 banks surpassed the 442 billion euros ($578 billion) in one-year loans extended in June 2009, when the global financial system was reeling from the collapse of the U.S. investment bank Lehman Brothers.

The ECB wants banks to use the money to help pay off or refinance some 230 billion euros ($300 billion) in existing loans early in 2012. Without the special support from the ECB, banks would have had to cut back on loans to businesses and further squeeze the European economy.

While the loans will help stabilize banks and make it easier for them to lend to businesses, they do not attack the root of Europe’s financial crisis — heavily indebted governments face unsustainable borrowing costs. Many economists believe that to solve that problem, the ECB needs to become the lender of last resort to European governments, buying up their bonds in large quantities in order to lower their borrowing costs.

ECB President Mario Draghi has said governments should not depend on a central bank bailout.

Markets initially rose after the amount of the ECB borrowing was announced; it was far higher than the 300 billion euros ($392 billion) expected. But the optimism faded as investors weighed the broader problems facing Europe’s economy.

The broad Stoxx 50 index of European shares fell 0.5 percent. The euro fell nearly 2 cents, to $1.3023 from $1.3198 earlier Wednesday.