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Tags: financial institution
Categories: Economics & Finance
The reserve requirement is a central bank regulation that sets the minimum fraction of customer deposits and notes that each commercial bank must hold as reserves (rather than lend out). These required reserves are normally in the form of cash stored physically in a bank vault (vault cash) or deposits made with a central bank.
(source: https://en.wikipedia.org/wiki/Reserve_requirement)
Synonyms:
cash reserve ratio
