The major central banks of the world will step up so-called swap line operations, which give non-US central banks greater access to dollars.
The US Federal Reserve and other major central banks have announced a coordinated effort to improve banks' access to liquidity, hoping to calm worries rattling the global banking sector.
The special drive was launched on Monday by the Fed and the central banks of Canada, the United Kingdom, Japan, the European Union and Switzerland.
The announcement came hours after Switzerland brokered the UBS takeover of its troubled Swiss rival Credit Suisse.
The central banks will step up so-called swap line operations, which give non-US central banks greater access to dollars.
"To improve the swap lines' effectiveness in providing US dollar funding, the central banks currently offering US dollar operations have agreed to increase the frequency of 7-day maturity operations from weekly to daily," the central banks said in a joint statement.
"The network of swap lines among these central banks is a set of available standing facilities and serve as an important liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the effects of such strains on the supply of credit to households and businesses," the statement added.
READ MORE: Fears of banking crisis haunt global stock markets
Volatility subsides in markets
Futures and Asian stocks fought to stabilise though banks remained under pressure on Monday as a rescue deal for Credit Suisse and a concerted effort by central banks to restore confidence eased immediate fears of contagion.
European futures rose 0.5 percent and S&P 500 futures rose 0.4 percent in bumpy trade. FTSE futures rose 0.3 percent. In cash trading, a bounce for banks in Tokyo retraced and most markets in Asia lost ground.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.6 percent.
While the volatility has subsided for now, investors remained fearful about what could happen next after a week in which a systemic lender in one of Europe's financial capitals was brought to its knees by the turmoil in the bond market resulting from the collapse of Silicon Valley Bank.
"The market's taken a positive view that that's one area of concern that's been cauterized," said Jason Wong, a senior strategist at BNZ in Wellington.
"But it doesn't solve the US-banking specific issues, where deposits are going out the door into safer banks," he said.
Markets have been riled by the failure of Silicon Valley Bank and fear of a shortage of liquidity as interest rates are raised to fight inflation.
In 2020, the Fed provided and later extended a similar swap line facility as the Covid-19 pandemic caused a global cash crunch.
READ MORE: Credit Suisse faces demise as UBS, Swiss regulators discuss takeover