The recent financial crisis of 2008, provides valuable insights into the liquidity risks financial institutions are exposed to and the measures that are taken to manage and mitigate those risks. In this course we look at three real-world examples. In particular we will review the following case studies:
We also give a summary of the time lines to each of their respective collapse/ bailout:
For a general understanding of how a liquidity crisis can develop and ways in which an institution may assess capital requirements for liquidity risk is explored in the following post:
Liquidity Risk Management – A framework for estimating liquidity risk capital for a bank
For a more in depth analysis of the financial crisis we recommend Roger Lowenstein’s book “The End of Wall Street”.
A review of the book is given here.