Question
Consider a bank with the following balance sheet: Assets Liabilities Reserves $100 million Deposits $600 million Loans $700 million Bank capital $200 million If the
Consider a bank with the following balance sheet:
| Assets | Liabilities | ||
| Reserves | $100 million | Deposits | $600 million |
| Loans | $700 million | Bank capital | $200 million |
If the bank suffers a deposit outflow of $105 million and the bank has a required reserve ratio on deposits of 10%, how much is the banks shortfall in reserves?
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The Global Financial Crisis What Have We Learnt
Authors: Steven Kates
1st Edition
0857934228, 978-0857934222
