Bank runs

**Bank runs**

A bank run occurs when a large number of customers withdraw their deposits simultaneously due to concerns about the bank’s solvency. This sudden demand for cash can quickly deplete a bank’s reserves, potentially leading to its collapse. Bank runs are often driven by panic, rumors, or loss of confidence in the financial institution. Understanding bank runs is crucial for grasping the dynamics of financial crises and the importance of regulatory measures such as deposit insurance and central bank interventions.