Some of the world’s largest central banks came together on Sunday to stop a banking crisis from spreading as Swiss authorities persuaded UBS Group AG (SIX:UBSG) on Sunday to buy rival Credit Suisse Group AG in a historic deal.

The special drive will be launched Monday by the Fed and the central banks of Canada, the United Kingdom, Japan, the European Union and Switzerland.

UBS will pay 3 billion Swiss francs ($3.23 billion) for 167-year-old Credit Suisse and assume up to $5.4 billion in losses in a deal backed by a massive Swiss guarantee and expected to close by the end of 2023. The deal includes 100 billion Swiss francs in liquidity assistance for UBS and Credit Suisse.

Credit Suisse shareholders were deprived of a vote on the deal and will receive one share in UBS for every 22.48 shares they own, valuing the bank at $3.15bn (£2.6bn). At the close of business on Friday Credit Suisse was valued at around $8bn (£6.5bn).

Swiss President Alain Berset who made the annoucement called it “one of great breadth for the stability of international finance. An uncontrolled collapse of Credit Suisse would lead to incalculable consequences for the country and the international financial system.”

Credit Suisse is among the world’s largest wealth managers and one of the 30 global systemically important banks, and its failure would ripple throughout the entire financial system, authorities fear.

In a global response of the type not seen since the height of the pandemic, the Fed said it had joined with central banks in Canada, England, Japan, the EU and Switzerland in a coordinated action to enhance market liquidity. The ECB vowed to support euro zone banks with loans if needed, adding the Swiss rescue of Credit Suisse was “instrumental” for restoring calm.

FRB Manages to Sail

Despite a move by several large banks to deposit $30 billion into First Republic Bank, the US banking sector still rocks.

On Sunday, First Republic saw its credit ratings downgraded deeper into junk status by S&P Global (NYSE:SPGI), which said the deposit infusion may not solve its liquidity problems.