משברי נזילות במערכת הבנקאית

Translated title of the contribution: Liquidity Crises in the Banking System

מיכאל לשם, סיון פרנקל

Research output: Contribution to journalArticlepeer-review

Abstract

In a market-based economy, an important role of the financial system is to match lenders and borrowers. Banks serve as financial intermediaries by issuing short-term obligations (deposits) to fund longer-term investments(loans). This maturity mismatch makes them vulnerable to unexpected large withdrawals. In this paper we review the theoretical and empirical literature on bank stability. We first analyze the vulnerability of a single bank to panics and bank runs, and explain why runs are more likely to occur at times of economic slowdown.We discuss the role of short-term debt, such as repo, in bank runs, and explain its role in the 2008 financial crisis and, in particular, in the fall of ״Lehmann Brothers״. Finally, we zoom-out and consider the banking system as a whole,and explain why liquidity crises tend to be correlated, and therefore pose a systemic risk.
Translated title of the contributionLiquidity Crises in the Banking System
Original languageHebrew
Pages (from-to)82-93
Number of pages12
Journalחידושים בניהול
Volume10
StatePublished - 2022

IHP publications

  • ihp
  • Bank buildings
  • Banks and banking
  • Financial crises
  • Liquidity (Economics)

Fingerprint

Dive into the research topics of 'Liquidity Crises in the Banking System'. Together they form a unique fingerprint.

Cite this