The Silicon Valley Bank Crisis and the Management of Bank Liquidity Risk: An Analysis of the Liquidity Coverage Ratio and Modern Deposit Guarantee Systems

Niccolò Giuseppe Cirillo

Banca Impresa Società, 2024, issue 3, 415-445

Abstract: This paper aims to analyze the Silicon Valley Bank crisis by examining (I) the role, functions, and characteristics of current international banking regulation on liquidity requirements, focusing on the Liquidity Coverage Ratio (paragraph 2), and (II) the objectives and features of depositor guarantee systems as safeguards against bank runs (paragraph 3). The study will then assess the validity of criticisms directed at both the Liquidity Coverage Ratio (paragraph 2.3.) and current depositor insurance systems (paragraph 3.1.), which are claimed to be inadequate in fulfilling their intended functions. The analysis will reference events related to the SVB crisis throughout.

Keywords: Bank-run; Liquidity Requirements; Deposit Guarantee Systems (search for similar items in EconPapers)
Date: 2024
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