---
title: Liquidity Risk in Bank Failures
url: https://www.ml-quant.com/papers/ssrn/5260010/
site: ML-Quant (https://www.ml-quant.com)
updated: 2026-09-26
license: Summaries CC BY 4.0; links go to the original sources
index: https://www.ml-quant.com/llms.txt
identifier: SSRN 5260010
source_url: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5260010
featured: 2025-05-21
citations: unknown
topic: Trading, Microstructure & Execution
---


# Liquidity Risk in Bank Failures

The article examines the failures of Silicon Valley Bank and Credit Suisse, advocating for a revision of current liquidity risk metrics to better reflect the pace and size of stress outflows in modern banking.

- Source: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5260010
- Identifier: SSRN 5260010
- Released: 2025-05-19
- First featured: Quant Letter No. 98 (2025-05-21): https://www.ml-quant.com/issues/2025-05-21/
- Citations (Semantic Scholar): not tracked
- Published in: not yet
- Topic: Trading, Microstructure & Execution

## Related

- [Liquidity Flows Bank-Affiliated Broker Dealers](https://www.ml-quant.com/papers/ssrn/5287025/): The paper studies the function of repo lending within the same bank holding company, discovering that internal liquidity channels aid in distributing liquidity from high-reserve banks to the broader financial system.
- [Trading Strategies in Markets](https://www.ml-quant.com/papers/repec/agh-journl-v-25-y-2024-i-2-p-117-131/): The article examines the potential and risks of money market trading in the Swiss banking sector, considering the impact of Basel III on cash trading and outlining the necessary skills for money market traders.
- [Banking Regulations and Liquidity Risk](https://www.ml-quant.com/papers/ssrn/5097938/): The research examines the positive effect of banking regulations on liquidity risk and financial stability in the European banking sector.
- [ECBs Impact](https://www.ml-quant.com/papers/ssrn/4913034/): The research uses a GVAR model to study the effects of the European Central Bank's unconventional monetary policies on six Central and Eastern European countries, showing that these policies reduce liquidity spread and raise yield spread, suggesting increased economic activity and a preference for bonds among investors.
- [Unrealized asset loss, liquidity risk from uninsured deposit outflows and bank runs: Evidence from the 2023 banking stress](https://www.ml-quant.com/papers/ssrn/4911252/): The Spring 2023 banking stress analysis reveals a potential $1.6 trillion loss for the U.S. banking system and identifies 20 banks at risk if half of uninsured deposits are withdrawn.
- [Bank Trading Profit](https://www.ml-quant.com/papers/ssrn/4898830/): Large U.S. dealer banks make substantial profits from their trading desks, which serve as financial intermediaries, without taking on market risk in the asset markets they mediate.