Bank run

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Related to Banking crisis: Financial crisis

Bank run (bank panic)

A series of unexpected cash withdrawals caused by a sudden decline in depositor confidence or fear that the bank will be closed by the chartering agency, i.e. many depositors withdraw cash almost simultaneously. Since the cash reserve a bank keeps on hand is only a small fraction of its deposits, a large number of withdrawals in a short period of time can deplete available cash and force the bank to close and possibly go out of business.

Bank Run

An event in which many account holders at a bank withdraw all of their funds at the same time because they do not believe the bank is solvent. Ironically, the pressure of a bank run itself can cause the bank to become insolvent. In the United States, bank runs were fairly common before the creation of the FDIC, which insures bank deposits up to a certain amount. See also: Panic.
References in periodicals archive ?
As oil prices have now started to recover, after oil producing countries' cartel OPEC implemented pro- duction cuts, the likelihood of another banking crisis seems to be greatly diminished.
He instead referred to the fiscal council's August statement in which it warned about the systemic risks from giving in to union demands to further increase compensation to pension funds for losses incurred during the banking crisis.
Lower returns on capital may be transferred to the banking system and may be one way of explaining how a banking crisis starts.
1] points in the log-odds ratio of a banking crisis occurrence, holding all other variables constant.
determine the relationship between the banking crisis borrowing activities of firms and the international trading activities.
Ecuadorean authorities announced on Tuesday, May 27, 2014 via Twitter that an arrest warrant has been issued for former President Jamil Mahuad for allegedly misappropriating public funds during the country's late 1990s banking crisis.
SIR David Walker has to be joking when he blames customers for the banking crisis.
Summary: George Osborne has said he is "optimistic" that the Spanish banking crisis can be solved.
ICELAND'S former prime minister Geir Haarde has been convicted of one charge related to the nation's banking crisis but cleared of four others.
When in Government, Ed Miliband was in the Labour Cabinet and was, presumably, made aware that he had at least part responsibility for their failure to control the huge banking crisis, including the Royal Bank of Scotland's colossal losses.
INDUSTRY bosses fear we are on the brink of another banking crisis, a survey has revealed.
31, to prevent confusion in the markets amid fears of fallout from the European banking crisis.

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