As investors continue to be on edge following the failure of Silicon Valley Bank, shares of the ailing Swiss banking giant Credit Suisse have fallen to a historic low.
When Credit Suisse acknowledged “significant weakness” in its accounting procedures on Tuesday, its stock fell by as much as 30% at one point.
Investors are concerned about how the bank, which is struggling, would deal with the consequences of American bank collapses.
The concerns spread to the stock markets, causing a severe decline in all major indices.
According to Capital Economics’ Andrew Kenningham, “The issues at Credit Suisse once again raise the question of whether this is the start of a worldwide catastrophe or just another ‘idiosyncratic’ episode.
The bank stated that there was no reason for alarm about its financial situation, and the chief executive remarked that its cash reserves were “still very, very solid.”
But, concern over issues at such a significant global player put pressure on banking shares globally.
As the Stoxx Europe banking share index fell 7%, the prime ministers of France and Spain intervened to comfort investors.
