reserve ratio

Definition

Amount of money and liquid assets that Federal Reserve System member banks must hold in cash or on deposit with the Federal Reserve System, usually a specified percentage of their demand deposits and time deposits. also called Federal Reserve requirement or reserve requirement.

Use reserve ratio in a sentence

I wanted to know the reserve ratio and I had a certain way to figure it all out, which was really amazing to me.

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The reserve ratio was met by the financial institution so it was able to operate within the confines of the law.

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The banks reserve ratio was a reminder to us that there does exist some tangible rules and procedures regarding their assets.

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Mentioned in these terms

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cash reserve ratio (CRR) required reserves