Bank Run
Also called: run on the bank, deposit flight, bank panic
A bank run is depositors withdrawing en masse because they fear others will withdraw first, which makes the fear self-fulfilling: no solvent bank holds enough cash to repay everyone at once. It's the classic multiple-equilibrium problem — both 'everyone stays' and 'everyone runs' are stable. Deposit insurance was invented to eliminate the bad equilibrium, and Silicon Valley Bank in 2023 showed how much faster a run moves when the withdrawals are digital and the deposits uninsured.
Want more than a definition? Learn it in Risk Arena →