Insolvency risk at a financial intermediary (Fl) is the risk that promised cash flows from loans and securities held by Fls may not be paid in full. incurred by an Fl when the maturities of its assets and liabilities do not match. that a sudden surge in liability withdrawals may require an FI to liquidate assets quickly at fire sale prices. risk that an FI may not have enough capital to offset a sudden decline in the value of its assets