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Why Do Banks Fail?
Bank failures are an inherent feature of the banking system. In the United States, 20.4 percent of all national banks between 1863 and 1934 and around 13 percent of all commercial banks between 1935 and 2023 failed during these periods. Bank failures often lead to economic disruptions, and systemic banking crises involving widespread bank failures are associated with severe economic downturns.
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