A deposit runoff rate is the percentage of a given type of deposit that a bank assumes will leave during a period of stress. Applying the rate to the balance gives an expected cash outflow, which the bank must be able to meet from liquid assets. Runoff rates are the main inputs to the liquidity coverage ratio, which tests survival over thirty days, and to a bank's own liquidity stress testing.
Under the Basel III standard, rates rise with the likelihood of flight. Stable retail deposits, covered by deposit insurance, carry a rate of 5%. Less stable retail deposits carry at least 10%. Operational deposits from businesses carry 25%, other deposits from non-financial companies 40%, and most unsecured wholesale funding from financial institutions 100%. The failures of several United States regional banks in 2023, where uninsured deposits left within days, led supervisors to question whether these assumptions suit an age of digital banking.