Reserve ratio

Updated: Aug 20, 2021

The proportion of the total assets of a bank or other financial institution held as reserves, that is as money balances or some form of highly liquid asset. Minimum reserve ratios have been used both as instruments of monetary policy, and as regulatory methods of attempting to ensure solvency.

Reference: Oxford Press Dictonary of Economics, 5th edt.

Sources & references
Risk disclaimer
James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.