Banks can contractually anticipate runs through a 'notice of withdrawal' clause (used by US trust companies and savings banks before FDIC) requiring 60-90 days notice; depositors accept it because they would want the clause invoked on others rather than be last in line, and the delay lets a prudently managed bank sell liquid assets to meet redemptions without dumping unsaleable assets at fire-sale losses.
factualpending
Speaker
Larry WhiteEvidence Quote
“it's in your interest to have that clause in all the deposit accounts if it really is a problem and the 90 days gives the bank time... to sell off some of its more liquid assets”
Created: 6/17/2026, 10:31:20 AM
My Notes
Loading notes...