Informed depositors and bank runs

Journal article

We study a model in which depositor information increases the likelihood of bank runs. Informed depositors can quickly withdraw when the bank has low-quality assets. Uninformed depositors may decide to wait, which allows them to learn by observing informed depositors’ actions. However, learning that the bank has low-quality assets will spark a run ex post, which increases the incentives of uninformed depositors to run ex ante. Moreover, when there are more informed depositors, uninformed depositors have a fear of missing out, which also makes preemptive runs more likely. The presence of informed depositors may, thus, increase the frequency of panic runs and decrease surplus.

Authors: Schliephake, E; Shapiro, J

• Publication status: Accepted
• Peer review status: Peer reviewed
• Publisher: Oxford University Press
• Journal: Review of Finance
• Acceptance date: 2026-04-12
• EISSN: 1573-692X
• ISSN: 1572-3097
• Language: English
• Keywords: information acquisition; bank runs; informed depositors