U.S. reserve requirements were set to 0% in March 2020; banks still hold large reserves for liquidity and regulatory reasons (LCR). Many other central banks still set requirements.
How to use the Reserve Ratio Calculator
- Reserves held
- Total deposits
- Reserve requirement
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the bank’s reserves, deposits and the reserve requirement.
Tips
- Use real (inflation-adjusted) figures to compare across years.
- Check whether data are seasonally adjusted.
- Use the same currency and base year throughout.
- Economic models simplify reality – treat results as illustrations, not forecasts.
Common mistakes to avoid
- Mixing nominal and real values.
- Comparing percentage changes with percentage-point changes.
- Treating correlations as causes.
Inputs explained
| Field | What to enter |
|---|---|
| Reserves held | Amount in your currency |
| Total deposits | Amount in your currency |
| Reserve requirement | In % |
What each result means
- Reserve ratio = [Reserves held]÷[Total deposits]×100
- Required reserves = [Total deposits]×[Reserve requirement]÷100
- Excess reserves = [Reserves held] – [Required reserves]
- Money multiplier = [Total deposits]÷[Reserves held]
Example values
How the main result changes when Reserves held changes and everything else stays at the example values above:
| Reserves held | Reserve ratio (%) |
|---|---|
| 60 | 6 |
| 90 | 9 |
| 120 | 12 |
| 150 | 15 |
| 180 | 18 |
| 240 | 24 |
Formula
Reserve ratio = reserves ÷ deposits × 100Required reserves = deposits × requirementExcess reserves = reserves − required reservesWorked example
Inputs — Reserves held: $120; Total deposits: $1,000; Reserve requirement: 10 %.
Results — Reserve ratio = 12 %; Required reserves = $100.00; Excess reserves = $20.00; Money multiplier = 8.33.
Frequently asked questions
What is the reserve ratio?
The share of deposits a bank holds as reserves.
What is the U.S. reserve requirement?
0% since March 2020.
What are excess reserves?
Reserves above the required amount.
What formula does the Reserve Ratio Calculator use?
Reserve ratio = reserves ÷ deposits × 100.