The great banks' depression: deposit withdrawals in the German crisis of 1931

Isabel Schnabel

No 03-11, Papers from Sonderforschungsbreich 504

Abstract: Using monthly balance-sheet data of all major German credit banks, we analyze deposit withdrawals and bank failures in the German banking and currency crisis of 1931. We show that deposit withdrawals were related to indicators of banks' liquidity and solvency and were hence not simply the consequence of a run on the German currency. We find no evidence that branch banks were more stable than unit banks. Finally, we show that larger banks had a lower probability of failure, were more likely to be bailed out by the public authorities, and were granted preferential access to the Reichsbank's discount window. We interpret these results as evidence for a 'too-big-to-fail' phenomenon.

Keywords: Deposit withdrawals; bank failures; "too big to fail"; Great Depression (search for similar items in EconPapers)
JEL-codes: C34 E5 G21 N24 (search for similar items in EconPapers)
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://madoc.bib.uni-mannheim.de/2772/1/dp03_11.pdf

Related works:
Working Paper: The Great Banks` Depression - Deposit Withdrawals in the German Crisis of 1931 (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:mnh:spaper:2772

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