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Bank reserves
 
 
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Bank reserves are bank
Bank

A bank is a financial institution whose primary activity is to act as a payment agent for customers and to borrow and lend money. It is an institution for receiving, keeping, and lending money....
s' holdings of deposit
Deposit account

A deposit account is a Current account at a banking institution that allows money to be deposited and withdrawn by the account holder, with the transactions and resulting balance being recorded on the bank's books....
s in accounts with their central bank
Central bank

A central bank, reserve bank, or monetary authority is the entity responsible for the monetary policy of a country or of a group of member states....
 (for instance the European Central Bank
European Central Bank

The European Central Bank is one of the world's most important central banks, responsible for monetary policy covering the 16 member States of the Eurozone....
 or the Federal Reserve, in the latter case including federal funds
Federal funds

In the United States, federal funds are overnight borrowings by bank to maintain their bank reserves at the Federal Reserve. Banks keep reserves at Federal Reserve Banks to meet their reserve requirements and to clear financial transactions....
), plus currency
Currency

A currency is a Medium of exchange, facilitating the trade of goods and/or Service s. It is coins and paper bills used as money. It is one form of money, where money is anything that serves as a medium of exchange, a store of value, and a standard of value....
 that is physically held in bank vault
Bank vault

A bank vault is a secure space where money, valuables, records, and documents can be stored. Vaults protect their contents with armored walls and a tightly fashioned door closed with a complex lock....
s (vault cash). The central banks of some nations set minimum reserve requirement
Reserve requirement

The reserve requirement is a bank regulation that sets the minimum bank reserves each bank must hold to customer Deposit account and Promissory note....
s. Even when no requirements are set, banks commonly wish to hold some reserves, called desired reserves, against unexpected events.

The Bank of England
Bank of England

The Bank of England is the central bank of the United Kingdom and is the model on which most modern, large central banks have been based. Since 1946 it has been a Nationalisation institution....
 uses the term rest to describe the same concept.








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Bank reserves are bank
Bank

A bank is a financial institution whose primary activity is to act as a payment agent for customers and to borrow and lend money. It is an institution for receiving, keeping, and lending money....
s' holdings of deposit
Deposit account

A deposit account is a Current account at a banking institution that allows money to be deposited and withdrawn by the account holder, with the transactions and resulting balance being recorded on the bank's books....
s in accounts with their central bank
Central bank

A central bank, reserve bank, or monetary authority is the entity responsible for the monetary policy of a country or of a group of member states....
 (for instance the European Central Bank
European Central Bank

The European Central Bank is one of the world's most important central banks, responsible for monetary policy covering the 16 member States of the Eurozone....
 or the Federal Reserve, in the latter case including federal funds
Federal funds

In the United States, federal funds are overnight borrowings by bank to maintain their bank reserves at the Federal Reserve. Banks keep reserves at Federal Reserve Banks to meet their reserve requirements and to clear financial transactions....
), plus currency
Currency

A currency is a Medium of exchange, facilitating the trade of goods and/or Service s. It is coins and paper bills used as money. It is one form of money, where money is anything that serves as a medium of exchange, a store of value, and a standard of value....
 that is physically held in bank vault
Bank vault

A bank vault is a secure space where money, valuables, records, and documents can be stored. Vaults protect their contents with armored walls and a tightly fashioned door closed with a complex lock....
s (vault cash). The central banks of some nations set minimum reserve requirement
Reserve requirement

The reserve requirement is a bank regulation that sets the minimum bank reserves each bank must hold to customer Deposit account and Promissory note....
s. Even when no requirements are set, banks commonly wish to hold some reserves, called desired reserves, against unexpected events.

The Bank of England
Bank of England

The Bank of England is the central bank of the United Kingdom and is the model on which most modern, large central banks have been based. Since 1946 it has been a Nationalisation institution....
 uses the term rest to describe the same concept.

Terms

  • Excess reserves - bank reserves in excess of the reserve requirement
    Reserve requirement

    The reserve requirement is a bank regulation that sets the minimum bank reserves each bank must hold to customer Deposit account and Promissory note....
    .
  • Free reserves - the margin by which excess reserves exceed borrowings. (Vogel 2001:421)


See also

  • Official gold reserves
    Official gold reserves

    Gold reserves are held by central banks as a store of value. In 2001, it was estimated that all the gold ever mined totaled 145,000 tonnes. One tonne of gold equated to a value of United States dollar30.27 million as of February 14, 2009 ....
  • Monetary base
    Monetary base

    In economics, the monetary base is a term relating to the money supply, the amount of money in the economy. The monetary base comprises only coins, paper money, and commercial banks' bank reserves with the central bank....
  • Reserve requirement
    Reserve requirement

    The reserve requirement is a bank regulation that sets the minimum bank reserves each bank must hold to customer Deposit account and Promissory note....