In addition, the Reserve Bank's approach to responding to a bank failure stresses the importance of being able to manage a bank failure in ways that avoid the need for a government-funded bail-out, and seeks to ensure that shareholders, subordinated creditors and senior creditors, including depositors, bear their fair share of losses.
To illustrate the possible economic impact of a drawdown in savings, we consider a scenario in which certain goods and services could experience higher-thannormal spending because of the release of pent-up demand.