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Reserve ratio definition

Macroeconomic textbooks define reserve ratio as reserves / deposits.

So for example, the following bank:

enter image description here

has a reserve ratio of $10 / $100 = 1/10 or 10%.

Federal Reserve H.8

The Federal Reserve H.8 report shows Assets and Liabilities of Commercial Banks in the United States.

The current report is available here:

https://www.federalreserve.gov/releases/h8/current/h8.pdf

Deposits

The deposits are straightforward to find in table 2:

enter image description here

Reserves

There isn't an item under Assets labeled Reserves.

enter image description here

I've highlighted in green the Bank credit section, which it seems we can rule out.

Question

How can we find the reserves total from the H.8 report?

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2 Answers 2

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  1. In March 2020 reserve requirements were abolished (see Fed), so banks do not hold any mandatory reserves anymore.

  2. Reserves were always included in these aggregate reports as part of cash. If you follow footnote 21 you will learn that cash includes 'vault cash'. As explained by the Fed's metadata vault cash was the cash used to satisfy mandatory reserves before they were abolished.

    Banks still hold non-mandatory reserves, but you can't see them from these aggregate balance sheets.

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  • $\begingroup$ Amazing and concise answer. Thank you. 🙂 $\endgroup$
    – dharmatech
    Mar 21, 2023 at 0:06
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    $\begingroup$ I think we can assume that Cash assets is part of the reserves. Would any of the other items under Assets be considered to be at least partly reserves? Let me know if you feel this should be a separate question. $\endgroup$
    – dharmatech
    Mar 21, 2023 at 0:11
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    $\begingroup$ @dharmatech historically on detailed accounts there would be reserve bank account or deposit but I am not sure where it would be included in these aggregated accounts. If you want to see the statistics on reserves FRED has separate series for that fred.stlouisfed.org/series/TOTRESNS <- this series tells you how much reserves banks keep (although again note there will be structural break in 2020 due to abolishing of required reserves and in fact even post 2009 Fed moved to excess reserve system (which is why the reserves were flat before in the graph) so it does not work like in your $\endgroup$
    – 1muflon1
    Mar 21, 2023 at 9:56
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    $\begingroup$ first figure anymore $\endgroup$
    – 1muflon1
    Mar 21, 2023 at 9:56
  • $\begingroup$ Perhaps quote the footnote in full: "21. Includes vault cash, cash items in process of collection, balances due from depository institutions, and balances due from Federal Reserve Banks." The final "balances due from Federal Reserve Banks" may be what the OP is thinking about. $\endgroup$
    – Henry
    Mar 21, 2023 at 22:19
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According to the Fed reserves may be maintained in the form of vault cash or a Reserve Bank account; some entities may hold the reserve requirement on behalf of other entities, but that distinction seems irrelevant for this question since we are only talking about aggregate numbers.

According to footnote 21 of the H.8 report you linked to, both of these items are included in "Cash assets". However, "cash assets" also includes deposits that commercial banks have at other commercial banks, which means they are double-counted. I am not sure how this effect could be untangled with only the given data.

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