Troubled Continental Illinois National Bank, less than a year ago the darling of the investment community, has stopped trying to raise funds in the U.S. money markets in the past several weeks because investors are scared by recent reverses at the bank, sources say.

Chicago's Continental, the nation's sixth-largest bank and biggest commercial lender, instead has turned to buying funds privately from long-time investors and to raising money in Europe and Asia. Investors there apparently are less jittery about the bank's big portfolio of problem loans and its $220 million in losses that stemmed from the failure of Penn Square National Bank.

Until the past few weeks, Continental had been one of the biggest sellers of so-called negotiable certificates of deposit. These big certificates, generally sold in denominations of $1 million or more, can be bought and sold by investors in much the same way stocks are bought and sold.

Continental has stopped selling certificates in the public money markets because it would have to pay a much higher interest rate than other big money center banks, where reverses have been neither so big nor so public as Continental's.

"They're deathly afraid of issuing new paper and getting U.S. investors to continue to expect those relative premiums over what other major banks pay to raise funds ," said an official of a major Wall Street firm that buys and sells certificates of deposit. He said that in the resale market, a holder of a Continental certificate must offer a buyer about a percentage point more than the yield on a certificate issued by a top-rated money center bank.

Sources close to Continental said that the bank is having no trouble raising funds and that the bank is paying close to market rates for the short-term securities it is selling to private customers and abroad. But one securities official said, "They're scrambling. Don't let anyone tell you differently. They're paying a premium."

Most analysts expect Continental, whose Penn Square problems triggered a $61 million loss in the second quarter, will weather the storm. But it is expected to face profit pressures in the coming months because it will have to pay more for money than its competitors.

The bank has been under pressure for some time, especially after Penn Square's failure. The final straw came Wednesday when Nucorp Energy filed for reorganization under federal bankruptcy laws. Continental has lent Nucorp $150 million.

Dealers and investors became so edgy about buying and selling outstanding Continental certificates that the bank publicly asked to be taken off the so-called "run"--a list of the top 10 banks whose financial standings are so secure that prices for their securities can be quoted as a group rather than individually.