WASHINGTON (MarketWatch) -- Banks have borrowed $34 billion in short-term credits from three central banks as part of the coordinated effort to alleviate a liquidity crunch at the end of the year.

U.S. banks borrowed $20 billion from the U.S. Federal Reserve for 28 days at 4.65%, the Fed announced Wednesday. The European Central Bank lent $10 billion at 4.65%, and the Swiss National Bank lent $4 billion at an average rate of 4.79%. The interest rates were determined by competitive bids.

Demand for the funds was relatively strong across a wide swath of banks, but did not reflect any desperation to obtain funds, according to analysis. The stop-out interest rates were on the high side of expectations, suggesting healthy demand. Read Steve Goldstein's commentary.

It was the first round of several auctions of short-term credits planned by the central banks to alleviate a liquidity crunch in credit markets. The Fed's second auction will be held Thursday, with $20 billion being offered for 35 days. The results of that auction will be released Friday.

A total of 93 banks bid in the Fed's auction on Monday, asking for $61.6 billion. The bid-to-cover ratio was 3.08. The loans are fully collateralized and will be repaid on Jan. 17. See the full announcement.

At 4.65%, the stop-out interest rate for the auction stood 10 basis points below the Fed's discount window rate of 4.75% and was 28 basis points below the prevailing interbank lending rate of 4.93%.

With 93 banks bidding, there was clearly no stigma to participating in this program, as has been the case with the Fed's primary credit facility (also known as the discount window), according to Lou Crandall, chief economist for Wrightson ICAP.

"The results are consistent with the notion that banks have a strong demand for funding at the right price," wrote David Greenlaw, an economist for Morgan Stanley. "If the stop-out rate had been above the discount rate [4.75%], it would have conveyed a hint of desperation. Alternatively, a lower bid-to-cover would have signaled a lack of interest in the new program."

"The relatively high stop-out rate probably says more about the cost of alternative sources of funds than about severe year-end funding problems," Crandall wrote.

Ahead of the results, observers warned against overanalyzing the auction. The proof of whether the extra liquidity is working will be seen in interbank interest rates.

Last week, major central banks announced a coordinated plan to pump at least $80 billion into the financial system at the end of the year. See full story.

Interbank lending rates have been extraordinarily high, showing a reluctance to lend. The hope is that the central banks can prime the pump and get credits flowing again.

On Tuesday, the European Central Bank trumped that announcement by offering unlimited funds at 4.21%. More than 350 billion euros ($500 billion) were borrowed in that auction. See full story.