Credit Suisse, a troubled banking giant, has announced that it will borrow up to 50 billion Swiss francs (equivalent to $54 billion or £44.5 billion) from the Swiss central bank to strengthen its liquidity and simplify its operations.

The move comes after the bank’s shares plummeted by 24% due to weaknesses in its financial reporting, sparking fears of a wider financial crisis and a sell-off on European markets. Credit Suisse’s CEO, Ulrich Koerner, has pledged to quickly deliver a more focused bank that better serves its clients.

In response to the situation, the Saudi National Bank, a major investor, has declined to provide additional funds to Credit Suisse. However, Swiss regulators have emphasized that the bank meets the requirements for systemically important financial institutions and that there are no immediate risks of contagion for other Swiss banks. The Bank of England is reportedly monitoring the situation closely.

Credit Suisse, which was established in 1856, has been embroiled in various scandals in recent years, including money laundering allegations and other issues. The bank has posted losses in 2021 and 2022, making it its worst year since the 2008 financial crisis, and has warned that it does not anticipate profitability until 2024.

Share values have plummeted, with the bank losing about two-thirds of its value last year as clients withdrew their funds. Investor concerns were further exacerbated by the disclosure of “material weakness” in the bank’s financial reporting controls. The chairman of the Saudi National Bank, the largest shareholder in Credit Suisse, stated that it would not buy more shares in the Swiss bank for regulatory reasons.

Despite Credit Suisse’s assertions that its financial position was not a concern, shares in the bank fell by 24% on Wednesday, leading other banks to cut ties with it. The collapse of Silicon Valley Bank (SVB) and Signature Bank in the US has added to fears of a financial crisis, resulting in volatile trading in bank shares. The Stoxx Europe banking share index dropped by 7% on Wednesday, with UK’s FTSE 100 falling by 3.8% or 293 points. The decline has prompted concerns of potential problems in Europe, with many investors selling their stocks.