They have a 10% reserve requirement in the US. So, if they get 10 dollars deposited, they can loan $100. Whether they get it from the feds or wherever varies and this guys explanation is slightly simplified, but as a general rule $10 of cash is $100 of working money for the bank.
They have a 10% reserve requirement in the US. So, if they get 10 dollars deposited, they can loan $100. Whether they get it from the feds or wherever varies and this guys explanation is slightly simplified, but as a general rule $10 of cash is $100 of working money for the bank.