Addressing banks’ vulnerability to runs, part 1: Facts, arguments, and policy challenges

Open Access
Authors
  • J. Suarez
  • X. Vives
Publication date 09-10-2024
Publisher VoxEU
Organisations
  • Faculty of Economics and Business (FEB) - Amsterdam Business School Research Institute (ABS-RI)
  • Faculty of Economics and Business (FEB)
Abstract The bank failures in March 2023 revived old debates about the role of deposit funding for banks, the best way to address the fragility inherent in deposit funding, and more general policy reflections on the need to adjust banks’ regulatory and supervisory frameworks. This first in a two-column series discusses the role of deposit funding in the EU banking system and the related risk of runs. It then elaborates on interest rate risk in banking and identifies existing or potential policies that could be used or adapted to address the vulnerability to runs or its underlying causes
Document type Web publication or website
Language English
Published at https://cepr.org/voxeu/columns/addressing-banks-vulnerability-runs-part-1-facts-arguments-and-policy-challenges
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