Bank of England Holds Emergency Talks Amid Credit Suisse Crisis

The Bank of England held emergency talks as the crisis at Credit Suisse escalated after the turmoil it caused in global markets on Wednesday, amid fears it was on the brink of financial disaster.

The Bank of England held emergency talks with its international counterparts after Credit Suisse shares plunged 30%. The ailing bank announced on Wednesday evening that it would take out a loan of up to £44 billion from the Swiss Central Bank.

Growing fears of a new banking crisis have prompted financial experts to revise economic growth forecasts, with some predicting that central banks will soon start cutting interest rates.

Credit Suisse said in a statement that it is taking “decisive action to deliver value to our customers and other stakeholders.”

Bank of England officials have held talks with their counterparts in an attempt to assess the potential impact of problems at Credit Suisse, a “systemically important” institution with influence in the global financial system.

Experts have predicted that a bailout plan will be needed to avert a crash that will rock banks and pension funds around the world. Stock markets fell earlier on Thursday as fears intensified.

The FTSE 100 fell nearly 4% as investors dumped British banks and asset managers. Insurance company Prudential lost more than 12% of its value, while Barclays lost 9%.

Meanwhile, Shell and BP shares fell more than 8%. Oil prices fell more than 5 percent as memories of the 2008 financial crisis and its aftermath heightened fears of a global recession.

Investors have become more worried about the global banking sector after the collapse of Silicon Valley Bank (SVB) and Signature Bank in the US last week.

Credit Suisse has been bouncing from crisis to crisis over the past two years, but its troubles worsened on Wednesday when its largest shareholder ruled out injecting additional liquidity into the ailing bank.

Source: Telegraph

Related Stories

Leave a Reply