Double Bank Runs and Liquidity Risk Management

By providing liquidity to depositors and credit-line borrowers, bankscanbe exposed to double-runs on assets and liabilities. For identification, we exploit the 2007 freeze of the European interbank market and the Italian Credit Register. After the shock, there are sizeable, aggregate double-runs. In the cross-section,credit-line drawdowns are not larger for banksmore exposed tothe interbank market;however, they are larger when we condition on the same firms with multiple credit lines. Weshow that, ex-ante, more exposed banks actively manage their liquidity risk by grantingfewer credit lines to firms that run moreduringcrises.