Spanish banks borrowed a record 365 billion euros from the ECB, up from 324.6 billion ($395.5 billion) in May, data from the Bank of Spain showed on Friday.

This represented about 30 percent of the 1.2 trillion euros that European banks needed last month from the ECB.

The data provided further evidence that Spanish lenders remain largely shut out of the interbank market as banks respond to the deepening debt crisis in the euro zone by reining in credit activity even further.

"It was widely expected that the data would reflect the growing loss of confidence towards Spain's banking sector," said Juan Pablo Lopez, banking analyst at Espirito Santo.

"Local banks are shut out of the wholesale markets, small investors and savers are losing confidence in their banks and the high yields offered on bonds means the Treasury has become a direct competitor for funds."

Data from the early months of 2012 show that capital is exiting Spain at its fastest rate since the launch of the single currency in 1999, and banking sources report retail deposits being transferred from small banks to bigger ones viewed seen as better armed to weather the current storm.

Banks in neighboring euro zone member Portugal borrowed a record 60.5 billion euros from the ECB in June. Portugal is under a 78-billion euro EU and IMF bailout.

Banks in fellow bailout recipient Ireland had 84.6 billion euros in outstanding ECB loans, up from 84.5 billion in May.

($1 = 0.8208 euros)

(Reporting by the Madrid bureau, Writing by Julien Toyer; Editing by John Stonestreet)

• A Permanent Economic Emergency