Term:
Systemic risk
Definition:

The risk that the inability of one institution to meet its obligations when due will cause other institutions to be unable to meet their obligations when due. Such a failure may cause significant liquidity or credit problems and, as a result, could threaten the stability of or confidence in markets.

Domain:
Finance
Source:
European Central Bank, 2004, Annual Report: 2004, ECB, Frankfurt, Glossary
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