London(CNN) The US Federal Reserve and a number of other big central banks announced a coordinated work Sunday evening to increase the flow of US dollars via the worldwide economic method with the aim of maintaining credit flowing to households and companies.

“The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank are currently announcing a coordinated action to boost the provision of liquidity by way of the standing US dollar liquidity swap line arrangements,” the central banks stated in a joint statement.

Sunday’s statement came just hours soon after Swiss authorities orchestrated an emergency takeover of Credit Suisse by UBS. Credit Suisse — a single of the 30 most essential banks in the worldwide economic method — was bleeding income final week soon after investor and consumer self-confidence collapsed.

Industry turmoil triggered by the second and third most significant bank failures in US history earlier this month is threatening to make it tougher for people today to borrow income, US Treasury Secretary Janet Yellen stated final week.

“If banks are below anxiety, they could possibly be reluctant to lend,” Yellen stated Thursday in testimony to the Senate Finance Committee. “We could see credit come to be much more costly and much less readily available.”

Christine Lagarde, president of the European Central Bank (ECB), told reporters Thursday that “persistently elevated market place tensions” could additional constrict credit circumstances that had been currently tightening in response to increasing interest prices.

Swap lines are agreements in between two central banks to exchange currencies. They enable a central bank to receive foreign currency from the central bank that troubles it, and distribute it to industrial banks in their nation.

The swap line in between US Federal Reserve and the ECB, for instance, enables the ECB to obtain US dollars in exchange for an equivalent quantity of euros. The ECB can then distribute these dollars to industrial banks in the 20 nations that use the euro.

The agreements can be an essential tool for preserving economic stability and stopping market place tension from affecting the economy, according to the ECB. For the duration of the worldwide economic crisis of 2008 following the collapse of Lehman Brothers, funding markets dried up mainly because of an intense aversion to threat. Beneath these situations it became hard for euro location banks to receive US dollars.

From Monday via at least the finish of April, the Fed and other central banks will make dollars readily available on a every day basis, rather than weekly.

“The network of swap lines amongst these central banks is a set of readily available standing facilities and serve as an essential liquidity backstop to ease strains in worldwide funding markets, thereby assisting to mitigate the effects of such strains on the provide of credit to households and companies,” they added.