Bank Failures: The Roles of Solvency and Liquidity

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Authors: Federal Reserve Bank of Richmond, Sergio Correia, Stephan Luck, Federal Reserve Bank of New York, Emil Verner
Cited by: 0
References: 2

Abstract

In this review, we synthesize the empirical evidence on illiquidity and insolvency as causes of bank failures and discuss what these findings imply for policies meant to address the incidence and consequences of financial crises.

Fields of Study & Subjects

Banking stability regulation efficiency Corporate Insolvency and Governance Financial Distress and Bankruptcy Prediction

Publication details

Journal / source
Federal Reserve Bank of Richmond Working Papers
Volume
26
Issue
02
Pages
1–37
Publication date
26 February 2026
Language
EN