Credit Suisse reportedly called on the Swiss National Bank to reassure markets that it is financially sound.

Credit Suisse shares plunged to a record low of 1.65 Swiss francs ($1.79) on Wednesday after its largest shareholder, Saudi National Bank (SNB), said it could not buy more of the company’s shares.

The 30% drop came amid widespread concerns that Credit Suisse might be on the brink of default.

Another bank run?

SNB Chairman Ammar Al Khudairy told Reuters on Wednesday that Saudi National Bank is prohibited from investing more in the troubled lender due to regulatory restrictions. It currently holds a 9.88% stake in the company, just 12 basis points below its 10% ownership limit.

Following the collapse of Silicon Valley Bank (SVB) last Friday, the news only added to the general fears in the industry, which has led to a decline in bank stocks this week. After US bank stocks were hit hard on Monday, several European banks faced declines on Wednesday, including Societe Generale (-11%) and Commerzbank (-8.5%).

Credit Suisse has been hit by regulatory compliance failures and scandals, strategic overhauls, weak earnings releases and macroeconomic pressures since last year. In October, the bank’s five-year credit default swaps began trading at a 10-year high, meaning investors are seeking protection against potential defaults.

CDS swaps surged to new highs again on Wednesday, with the market pricing in a 47% chance that the company would default.

The bank’s shares hit new lows on Tuesday when Credit Suisse published its annual report identifying “significant weaknesses” in its financial reporting and disclosure controls, just a month after it posted its worst annual loss since the 2008 financial crisis.

Nonetheless, SNB’s Al Khudairy told Reuters he was pleased with Credit Suisse’s turnaround plan.

“I don’t think they need the extra money; if you look at their ratios, they’re good,” he said. “And they operate under a strong regulatory regime in Switzerland and other countries.”

Credit Suisse CEO Ulrich Koerner told CAN on Wednesday that the bank had a “very, very strong” capital and liquidity base. SVB’s CEO made a similar statement last week, telling clients to “remain calm” before the bank collapsed the next day.

Credit Suisse's size

When discussions of a possible collapse of Credit Suisse began last year, analysts likened the idea to a repeat of the 2008 fallout from Lehman Brothers.

Bitcoin enthusiast and high-yield credit trader, risk manager and 30-year analyst Greg Foss said Credit Suisse is a "systemically important financial institution" that is currently in collapse.

“There’s a run on the banks,” he said in an interview on Tuesday. “The wealth sector is losing assets in a spectacular way. ... I’m not saying they’re insolvent, but I’ve seen enough banks that are insolvent.”

When SVB collapsed last week in a bank run, the Fed stepped in on Sunday to bail out all of the bank’s depositors in an effort to stem market contagion. On Wednesday, the Financial Times reported that Credit Suisse had called on the Swiss Central Bank to provide verbal support for its financial situation.

Caitlin Long, CEO of Custodia Bank, said Credit Suisse is “bigger than Switzerland” and if the bank failed it would become “a problem for the Federal Reserve.”