  Banking system crises are complex events that in a short span of time can
inflict extensive damage to banks themselves and to the external economy. The
crisis literature has so far identified a number of distinct effects or
channels that can propagate distress contagiously both directly within the
banking network itself and indirectly, between the network and the external
economy. These contagious effects, and the potential events that trigger these
effects, can explain most aspects of past crises, and are thought to be likely
to dominate future financial crises. Since the current international financial
regulatory regime based on the Basel III Accord does a good job of ensuring
that banks are resilient to such contagion effects taken one at a time,
systemic risk theorists increasingly understand that future crises are likely
to be dominated by the spillovers between distinct contagion channels. The
present paper aims to provide a model for systemic risk that is comprehensive
enough to include the important contagion channels identified in the
literature. In such a model one can hope to understand the dangerous spillover
effects that are expected to dominate future crises. To rein in the number and
complexity of the modelling assumptions, two requirements are imposed, neither
of which is yet well-known or established in the main stream of systemic risk
research. The first, called stock-flow consistency, demands that the financial
system follows a rigorous set of rules based on accounting principles. The
second requirement, called Asset-Liability symmetry, implies that every
proposed contagion channel has a dual channel obtained by interchanging assets
and liabilities, and that these dual channel pairs have a symmetric
mathematical representation.

General Finance;Economics