Credit Suisse has said it will borrow up to 50bn Swiss francs (£44.5bn) from the country's central bank to shore up its finances.
The troubled banking giant said it is taking "decisive action" to strengthen and its simplify its business.
Shares in Credit Suisse fell 24% on Wednesday after it said it had found "weakness" in its financial reporting.
Fears of a wider banking crisis sparked steep falls on stock markets, with Asian shares dropping.
However, markets in Europe are expected to open higher on Thursday.
The BBC understands that the Bank of England has been in touch with Credit Suisse and the Swiss authorities to monitor the situation.
Swiss National Bank, the country's central bank, insisted Credit Suisse had the money it needed, but stressed it was ready to make liquidity available to protect it.
Problems in the banking sector surfaced in the US last week with the shock collapse of Silicon Valley Bank, the country's 16th-largest lender, followed two days later by the failure of New York's Signature Bank.
Developments at Credit Suisse were "amplified" by problems at the smaller banks, said Sayuri Shirai, an economics professor at the Keio University in Tokyo.
"Investors and creditors are concerned about risk. Banks may suffer from raising funds, which in turn will affect the cost of funding for smalls and medium sized firms and start-ups globally," she told the BBC.
Japan's Nikkei 225 index was down by 1.1% in late midday trading, with markets in Hong Kong and Sydney down by over 1.5%. The Shanghai Composite lost 0.5%.
"Markets could return to normal quickly once the US centric episode fades to the back burner," said Stephen Innes, managing partner at SPI Asset Management.
"Broader contagion fears at this stage are limited as banks are so much better capitalised in Asia."
Credit Suisse, founded in 1856, has faced a string of scandals in recent years, including money laundering charges, spying allegations and high profile departures.
'Material weaknesses'
It lost money in 2021 and again in 2022 and has warned it does not expect to be profitable until 2024.
The bank's disclosure on Tuesday of "material weakness" in its financial reporting renewed investor concerns.
These were intensified when the Saudi National Bank, Credit Suisse's largest shareholder, said it would not buy more shares in the Swiss bank on regulatory grounds.
At that time, Credit Suisse insisted its financial position was not a concern.
But shares in the lender plunged as other banks rushed to reduce their exposure to the firm and prime ministers in Spain and France spoke out in an attempt to ease fears.
On Thursday, Credit Suisse said it would borrow up to 50bn Swiss francs from the central bank "to pre-emptively strengthen its liquidity".
The collapse of Silicon Valley Bank has also fuelled concerns about the value of bonds held by banks, as rising interest rates made those bonds less valuable.
Central banks around the world - including the US Federal Reserve and the Bank of England - have sharply increased interest rates as they try to curb the rate of price rises, or inflation.
Banks tend to hold large portfolios of bonds and as a result are sitting on significant potential losses.
The falls in the value of bonds held by banks is not necessarily a problem unless they are forced to sell them.
Silicon Valley Bank - which specialised in lending to technology companies - was shut down on Friday by US regulators in what was the largest failure of a US bank since 2008.
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2023-03-16 05:10:17Z
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