12 CFR 204FRBactive
Reserve Requirements (Regulation D)
Plain English Summary
Establishes the percentage of deposits that banks must hold in reserve and cannot lend out.
CFR Title
12
CFR Part
204
Effective Date
Nov 13, 1980
Jurisdiction
US
Full Text
Depository institutions that maintain transaction accounts or nonpersonal time deposits are subject to reserve requirements established by the Board of Governors of the Federal Reserve System. Reserve requirements specify the percentage of certain deposits that must be held as reserves either as vault cash or on deposit at a Federal Reserve Bank.
The Board may adjust reserve ratios to implement monetary policy. As of March 2020, the Board reduced reserve requirement ratios to zero percent, but the regulatory framework remains in place for potential future adjustments.
finance