Asked whether Saudi National Bank was open to further cash injections, Chairman Ammar Al Khudairy said “absolutely not.” It was a reminder about the precarious situation facing the Swiss bank just one day after its CEO, Ulrich Koerner, had sought to shore up investor confidence by pointing to signs of improvement in its business.

Credit Suisse’s shares plummeted 24% in the biggest one-day selloff on record. Its bonds fell to levels that signal deep financial distress, with securities due in 2026 dropping 20 cents to 67.5 cents on the dollar in New York. That puts their yield over 20 percentage points above US Treasuries, according to Trace.

For global investors still on edge after the rapid-fire collapse of three regional US banks, the growing Credit Suisse crisis provided a new reason to sell risky assets and pile into the safety of government bonds. Benchmark indexes in Europe sank more than 3% and the S&P 500 lost 1.5%. Short-term German bonds and Treasuries soared, pushing their yields down by 40 basis points.

“Markets are very sensitive to the negative news flow after the surprise of seeing a US bank disappear from one day to the other,” said Francois Lavier, head of financial debt strategies at Lazard Freres Gestion. “In a context where market sentiment is already weakened, not much is needed to weaken it even further.” 

Societe Generale SA, BNP Paribas SA and Banco de Sabadell SA fell more than 10%, leading the decline in the Stoxx 600. Among European banks, more than $60 billion in combined market value was wiped out on Wednesday. 

In the US, the losses were smaller but banks, especially regional ones, were hit hard. Citigroup Inc. and Goldman Sachs Group Inc. slid 5%, and the KBW Bank Index, one of the main gauges of the banking industry, slumped to the lowest since 2020. 

“There’s panic and traders scrambling for safety,” said Oliver Scharping, a portfolio manager at Bantleon. “Markets see a Credit Suisse collapse almost there, yet financials still look healthy.”

CEO Koerner on Tuesday pointed to the firm’s liquidity coverage ratio, which indicates the bank can handle more than a month of heavy outflows in a period of stress. He said that the firm saw inflows on Monday amid the market turmoil and is ahead of schedule on its turnaround plan. A spokesperson at the bank declined to comment when contacted by Bloomberg News.  

At a certain level, there was nothing surprising about what Al Khudairy said. The Saudi National Bank had maintained that stance since last year, when its stake in Credit Suisse reached 9.9%. 

All of which underscores just how high angst now is — both surrounding the fate of Credit Suisse and, more broadly, a global economy that’s been shaken by central bankers trying to rapidly quell an inflation outbreak. Recession fears sent the price of oil tumbling below $70 a barrel for the first time since 2021 in the US.

“The Credit Suisse situation doesn’t help,” said Evgenia Molotova, senior investment manager at Pictet Asset Management. “Investors are increasingly worried about banks balance sheets and the effects of the rapid rise of interest rate on the cost of funding.”