reserve requirements

reserve requirements
The minimum amount of cash and liquid assets as a percentage of demand deposits and time deposits that member banks of the Federal Reserve are required to maintain. Chicago Board of Trade glossary
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The percentages of different types of deposits that banks are required to hold on deposit at the Federal Reserve or as cash in their vaults. These requirements are determined by the Federal Reserve Board and function as a tool to control monetary policy. American Banker Glossary
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The percentage of different types of deposits that member banks are required to hold on deposit at the Fed. Bloomberg Financial Dictionary

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   Percentage of deposits that, by law, depository institutions must set aside in their vaults or with their central bank. Lowering or raising this requirement influences the money supply. A reduction in reserve requirements enables banks to increase lending while an increase forces them to reduce lending. Sometimes known as minimum reserve requirements, registered reserves or reserve ratio.

Financial and business terms. 2012.

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