Anyone who remembers the banking crash of 2008 will have felt a flutter of apprehension at the news that Credit Suisse is in trouble.
The giant Swiss bank - usually known for its solid dependability - has been forced to borrow up to £45 billion from Switzerland’s central bank to bolster its finances.
It follows the collapse of Silicon Valley Bank in America, and has raised fears that the global banking system is once again teetering on the brink.
So how worried should we be and what is the potential impact on the wider economy?
What has happened at Credit Suisse?
Fears about the bank first emerged when its largest shareholder, the Saudi National Bank, said it would not put more money into it.
The Swiss bank also said it had found “weakness” in its financial reporting.
The partial bailout by the Swiss central bank has helped to steady the ship, but experts believe Credit Suisse is not out of the woods yet.
What has been the reaction around the world?
Shares in Credit Suisse lost more than a quarter of their value at one stage on Wednesday after the Saudi National Bank said it would not be providing any more capital.
Stock markets around the world took fright at the possible knock-on effects of the bank’s woes, with London’s FTSE 100 Index closed down 3.8% on Wednesday – its worst one-day performance since the start of the Covid-19 pandemic.
The Hang Seng Index in China tumbled nearly 2% and Japan’s Nikkei 225 was almost 1% lower after the bank announced its Swiss central bank loan.
The Bank of England is also said to have been in emergency talks with its global central bank counterparts.
What are the experts saying about the situation?
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “The £45 billion rescue wad is staunching worries about a bigger run on Credit Suisse and the repercussions for other institutions around the world exposed to its operations.
“For now, the move has restored a little stability to global markets. Nerves are still frayed though and that has been evident during trade in Asia.”
How worried should we all be?
There really is no need to panic at this point.
The global banking sector is in a much stronger position than it was at the time of the 2008 crash, thanks largely to political decisions taken at the time forcing banks to put stronger safeguards in place to prevent a repeat.
Nevertheless, the collapse of Silicon Valley Bank, as well as the troubles at Credit Suisse, demonstrate that those measures are by no means fool proof.
Central banks and political leaders around the world will be keeping a very close eye on developments to ensure swift action can be taken if other financial institutions find themselves in trouble