A bank run is a situation which takes place when bank customers are not sure about the stability of the bank and they decided to withdraw all their money from the bank. This is a tragic situation for any bank as it’s customers have lost trust on it and they want to withdraw their money from bank. Bank run takes place when bank is heavily burdened with debt and credit agencies downgrade the bank as a bank with low standing. In addition, it is also rumored that bank is soon to be closed due to bankruptcy. When credit agency downgrades the bank more and more people demand to withdraw their money and then massive withdrawals take place which pushes the bank closer to the insolvency and increases the chance of its default.
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