Only vault cash and reserve balances kept with the Federal Reserve banks count in meeting legal reserve requirements.

Name: Only vault cash and reserve balances kept with the Federal Reserve banks count in meeting legal reserve requirements.
Brand: Quizplus
Rating: 4.7 (32 reviews)

Question

Quizplus · Accepted Answer

Vault cash and reserve balances held at Federal Reserve banks are indeed the only assets that count towards meeting a bank's legal reserve requirements. These requirements are set to ensure banks have enough liquidity to meet their obligations.

Only Vault Cash and Reserve Balances Kept with the Federal