Anatomy of the Bank Runs in March 2023

Marco Cipriani, Thomas Eisenbach and Anna Kovner

No 20241220, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: Runs have plagued the banking system for centuries and returned to prominence with the bank failures in early 2023. In a traditional run—such as depicted in classic photos from the Great Depression—depositors line up in front of a bank to withdraw their cash. This is not how modern bank runs occur: today, depositors move money from a risky to a safe bank through electronic payment systems. In a recently published staff report, we use data on wholesale and retail payments to understand the bank run of March 2023. Which banks were run on? How were they different from other banks? And how did they respond to the run?

Keywords: bank runs; Sunspots; payment; data (search for similar items in EconPapers)
JEL-codes: G0 G21 (search for similar items in EconPapers)
Date: 2024-12-20
New Economics Papers: this item is included in nep-fdg
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Journal Article: Anatomy of the Bank Runs in March 2023 (2024)
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