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Uncertainty around Credit Suisse – the Swiss banking giant that has long been plagued by regulatory woes and financial stress – has wreaked havoc on global markets as concerns over rising interest rates worldwide lead to historic bank failures and sudden government intervention .

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Shares soared 33% on Thursday after an announcement that the Swiss national bank would lend Credit Suisse up to $54 billion, a nearly 17% gain, as investors braced for the central bank to help Credit Suisse avoid a possible collapse. rallied around the efforts of

The sudden jump in shares is a stark contrast to the bank’s seven-day losing streak, when shares were halted on Wednesday as they plunged as much as 21%.

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The chaos followed Tuesday’s announcement from Credit Suisse, which said it had found “material weaknesses” in its 2021 and 2022 financial reporting process.

After the lender shared weaknesses found in its 2021 and 2022 reporting process (including a lack of effective risk assessment to identify misstatements in its financial reporting), the Saudi National Bank—Credit Suisse’s biggest backer—Said It will not buy any more shares in the Swiss bank.

Then the collapse of Signature and Silicon Valley Bank – two smaller regional lenders – caused panic throughout the investing world as concerns arose for Credit Suisse, as Arthur Wilmarth, a professor at the George Washington School of Law, Said The collapse of CNN, Signature and SVB was a signal problem “could spread to banks of very large size.”

Credit Suisse is known as “global systemically important bank“A bank whose risk profile is considered so significant that its failure could trigger a wider financial crisis, so its potential collapse would be detrimental to the global economy.”

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Following its closure by the Federal Deposit Insurance Corporation, California's financial regulator, the collapse of SVB was marked as the biggest US bank failure ever. since Great Recession. company announced On March 8, it sold $21 billion in securities for a loss of $1.8 billion and will seek to raise $2.25 billion in capital. The California-based bank was popular in the tech world, many of its pictures customers From startups, venture capital firms and wealthy tech workers. Concern about the bank's stability prompted some venture capital firms, such as Peter Thiel's Founders Fund advise Portfolio companies to withdraw money from SVB. signature bank fail Just two days after SVB, it became the third largest bank failure in US history. Experts like former Congressman Barney Frank Held responsible Signature's closure is "an SVB-generated panic". The collapse of SVB affected other banks, such as First Republic Bank, whose shares decline as much as 52%. It Led to the Federal Reserve announcement of An emergency lending program so that banks can meet the needs of their depositors and eliminate the need to sell quickly during stressful times.

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Although the collapse of SVB and Signature shone a spotlight on Credit Suisse, the problems of the three are not linked. Credit Suisse has been involved in several scandals that have spooked investors in recent years, including mismanagement of funds that was exposed in its 2022. financial report, The bank closed the financial year 2022 with a Harm At nearly $8 billion, it is the largest deficit since the 2008 global financial crisis. the bank was convicted in June 2022 for failing to prevent money laundering by a Bulgarian cocaine trafficking gang. The Swiss government claimed that the gang laundered millions of dollars through the bank and fined Credit Suisse $2.1 million and ordered the Swiss government to pay $20 million. In March 2022, the Bermuda Court Government The bank owed ex-Georgian prime minister Bidzina Ivanishvili and his family nearly $500 million in damages from the local life insurance company Credit Suisse. The court ruled that Pascal Lescaudron, a former Credit Suisse consultant, had perpetrated long-running fraud against the family. Although Credit Suisse appealed against the decision, it believes the case will cost around $600 million. Credit Suisse chief executive Tidjene Thiam forced to step down in 2020 resign Following its unveiling the bank hired private detectives to spy on its former head of wealth management when he left to join a rival bank. Other scams Peter Bockover, chief investment officer at Bleakley Financial Group, also contributed. Said CNN had a "slow-moving car crash" of Credit Suisse.

Another Credit Suisse crisis: The bank finds 'material weaknesses' in its financial reporting (Forbes)

What to know about the collapse of Silicon Valley Bank - the biggest bank failure since 2008 (Forbes)

Credit Suisse stock sinks to record low as bank concerns mount (Forbes)

Credit Suisse turmoil: Swiss central bank will support troubled bank 'if necessary' (Forbes)

Why the banking scare is back (CNN),