UBS is said to take over Credit Suisse in a deal aimed at stemming what was fast becoming a global crisis of confidence. Credit Suisse, the 167-year-old embattled lender had been brought to the brink of financial calamity last week, despite securing a $54bn (£44bn) credit line from Switzerland's central bank.

çSKy News reported that that takeover was announced on Sunday evening - UBS will pay 3bn Swiss francs (£2.6bn) to acquire Credit Suisse, it has agreed to assume up to 5bn francs (£4.4bn) in losses, and 100bn Swiss francs (£88.5bn) in liquidity assistance will be available to both banks.

The deal is expected to be closed by the end of this year.

Meanwhile, European Central Bank (ECB) supervisors do not expect contagion for euro zone banks from the market turmoil, a source familiar with the content of an ad hoc supervisory board meeting this week told Reuters.