The US central bank (Fed) said on Thursday it had lent almost $12 billion to US banks since Sunday, when it announced it would provide the necessary funds to meet withdrawal requests from their customers, AFP reported.
In a joint statement with the Treasury Department and the banking regulator FDIC, the financial authorities presented a number of measures aimed at reassuring individuals and companies following the bankruptcy of California-based Silicon Valley Bank (SVB).
First there was information that the American bank Silicon Valley Bank went bankrupt. A few hours later, a much larger bank, Credit Suisse, is showing signs that things are not going well.
The Swiss National Bank said late on Wednesday that it was ready to give Credit Suisse cash support after shares in the troubled lender fell 30 percent.
The bank’s problems arose after the chairman of the National Bank of Saudi Arabia, Credit Suisse’s main shareholder, ruled out any further investment in the bank’s capital.
In a statement on Thursday, Credit Suisse said it had decided to “strengthen its liquidity” by borrowing funds from the Swiss central bank under a credit facility.
Chief Executive Ulrich Koerner said the moves “demonstrate decisive action to strengthen Credit Suisse as we continue our strategic transformation.” Körner’s restructuring included the sale of part of Credit Suisse’s investment division and the elimination of thousands of jobs.
The move is Credit Suisse’s latest attempt to restore investor confidence after a series of scandals and collapses that rocked the Swiss bank and sent its share price to record lows.
Shares in Credit Suisse fell 24.2% on Wednesday, valuing the bank below 7 billion francs. The bank’s shares have fallen by 39% this year, and by 85% over the past two years.
Credit Suisse’s fall on Wednesday weighed on shares of European and US banks reeling from the collapse of SVB, the biggest US bank failure since 2008.
Investors also say Credit Suisse’s problems are just a reminder to other European banks that they also hold large bond portfolios that have been hurt by rising interest rates.
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Source: Hot News
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.