I am reading Ryan-Collins et al. (2013, Where Does Money Come From? A Guide to the UK Monetary and Banking System). I think I understand how banks create new money whenever they make a loan.
Using their example in 4.2, when a bank loans say £10,000 to Robert, their assets increase by the £10,000 loan and their liabilities also increase by £10,000 in the form of a deposit into Robert's new account. The latter deposit is the new money created by the bank.
However, I do not understand how:
the bank creates new money when it ... pays its staff salaries or bonuses.
Say the bank pays its own staff Jane £5,000. What happens to the bank's balance sheet?
I think a deposit of £5,000 is made into Jane's bank account -- this is the new money created and is recorded under the bank's liabilities. But is there any corresponding change in assets?