Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/311095 
Year of Publication: 
2024
Series/Report no.: 
ECB Occasional Paper No. 361
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
Since the March 2023 banking turmoil, a policy debate has emerged concerning the unprecedented scale and speed of the observed deposit outflows. Have recent stress episodes and developments in technology structurally changed depositors' behaviour? Are the Basel III liquidity coverage ratio (LCR) run-off assumptions for cash outflows still fit for purpose? Leveraging on monthly liquidity reporting for a sample of 110 significant institutions (SIs) between 2016 and 2024, we shed light on some stylised facts pertaining to the composition of deposit flows in the banking union. Overall, we find limited evidence of a structural change in the statistical behaviour of deposit flows to date. For all but one of the deposit classes included in the analysis, more than 90% of observable net outflows remained below the LCR run-off assumptions during the whole sample period. Some extreme deposit outflows recorded during the COVID-19 pandemic and for a few SIs assessed as failing or likely to fail (FOLTF) remain rare tail events for which the LCR standard was not designed.
Subjects: 
liquidity risk
deposit outflows
bank runs
LCR run-off assumptions
bank regulation
financial risk
banking policy
financial institution
monetary crisis
JEL: 
G20
G21
G28
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-6877-5
Document Type: 
Research Report

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