systemic risk


: the risk that the failure of one financial institution (such as a bank) could cause other interconnected institutions to fail and harm the economy as a whole

Example Sentences

Recent Examples on the Web Treasury Secretary Janet Yellen and other top regulators on Friday announced a proposal to strengthen federal oversight of nonbanks that pose systemic risk. Zachary Halaschak, Washington Examiner, 21 Apr. 2023 Some outside experts had been seriously skeptical that SVB’s collapse posed a systemic risk. Jeff Stein, Anchorage Daily News, 13 Mar. 2023 Blankfein said the government wasn’t helping out based on what groups of depositors were affected, but because of systemic risk for the entire banking system. Ramishah Maruf, CNN, 19 Mar. 2023 Over 650 firms—including prominent names like General Catalyst, Bessemer, and Lux Capital—recommended that their companies keep or return their money to SVB, despite an ongoing public conversation about the systemic risk of aggregating startup capital into a single bank. WIRED, 18 Mar. 2023 There is no systemic risk, but there is a risk on consolidation. Melissa Quinn, CBS News, 12 Mar. 2023 One potential option could be to use the FDIC’s systemic risk exception tool to backstop the uninsured deposits at SVB. Jesse Pound, NBC News, 10 Mar. 2023 A day later, Yellen said in something of a reversal that the federal government is ready to take more action to stop bank contagion if necessary to curb systemic risk. Krystal Hur, CNN, 25 Mar. 2023 But like the S&Ls of the ‘80s, the recent failures of SVB, as well as Silvergate Bank and Signature Bank, add up to the loss of regional institutions that, taken together, posed such a systemic risk that D.C. put taxpayer money on the line. Will Daniel, Fortune, 21 Mar. 2023 See More

These examples are programmatically compiled from various online sources to illustrate current usage of the word 'systemic risk.' Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback about these examples.

Word History

First Known Use

1977, in the meaning defined above

Time Traveler
The first known use of systemic risk was in 1977

Dictionary Entries Near systemic risk

Cite this Entry

“Systemic risk.” Dictionary, Merriam-Webster, Accessed 4 Jun. 2023.

Legal Definition

systemic risk

sys·​tem·​ic risk sis-ˈte-mik- How to pronounce systemic risk (audio)
: the risk that the failure of one financial institution (as a bank) could cause other interconnected institutions to fail and harm the economy as a whole
Last Updated: - Updated example sentences
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