Reserves: Difference between revisions
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''Banking''. | ''Banking''. | ||
Deposits maintained by non-[[central bank]] [[monetary financial institution]]s with their central bank in the latter's capacity as 'the bankers' bank'. Central banks may require institutions to maintain minimum balances with the central bank, in which case balances in excess of the minimum are known as 'excess reserves'. | Deposits maintained by non-[[central bank]] [[monetary financial institution]]s with their central bank in the latter's capacity as 'the bankers' bank'. | ||
Central banks may require institutions to maintain minimum balances with the central bank, in which case balances in excess of the minimum are known as 'excess reserves'. | |||
Of course banks publish accounts and use the term in the accounting sense | Of course banks publish accounts and use the term 'reserves' in the accounting sense too. Do not be confused by this. | ||
== See also == | == See also == | ||
* [[Central bank]] | |||
* [[Central bank money]] | |||
* [[Conservative]] | * [[Conservative]] | ||
* [[Equity]] | * [[Equity]] | ||
Revision as of 06:27, 8 August 2016
1.
Accounting.
Reserves represent the amount of money ‘owed’ to the owner (shareholder) of the company.
In a profitable and conservative company, reserves will normally comprise a significant balance of accumulated undistributed profits.
2.
Banking.
Deposits maintained by non-central bank monetary financial institutions with their central bank in the latter's capacity as 'the bankers' bank'. Central banks may require institutions to maintain minimum balances with the central bank, in which case balances in excess of the minimum are known as 'excess reserves'.
Of course banks publish accounts and use the term 'reserves' in the accounting sense too. Do not be confused by this.
