Swiss Central Bank Saves Credit Suisse With $54-B Lifeline

Credit Suisse said it would borrow up to $54 billion from the Swiss central bank to shore up liquidity and investor confidence after a slump in its shares intensified fears about a global banking crisis, Tom Westbrook and Saeed Azhar reported for Reuters.

Photo Insert: Credit Suisse said it would exercise an option to borrow from the central bank up to 50 billion Swiss francs ($54 billion).

The bank's announcement helped stem heavy selling in financial markets in Asian morning trade on Thursday, following torrid sessions in Europe and the United States overnight as investors fretted about potential runs on global bank deposits.

Credit Suisse said it would exercise an option to borrow from the central bank up to 50 billion Swiss francs ($54 billion).

Earlier, Swiss authorities confirmed that Credit Suisse met "the capital and liquidity requirements imposed on systemically important banks" and that it could access central bank liquidity if needed.

Credit Suisse is the first major global bank to be given an emergency lifeline since the 2008 financial crisis and its problems have raised serious doubts over whether central banks will be able to sustain their fight against inflation with aggressive interest rate hikes.

Asian stocks followed Wall Street's tumble on Thursday and investors bought gold, bonds and the dollar. While the bank's announcement helped trim some of those losses, trade was volatile and sentiment fragile.

"It does help. It removes an immediate risk. But it confronts us with another choice. The more we do this, the more we blunt monetary policy, the more we have to live with higher inflation -- and what is it going to be?" said Damien Boey, chief equity strategist at Barrenjoey in Sydney.

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