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What would a bank do to meet its required reserves ratio?

Would it increase deposits? To me deposits cannot be increased unless someone makes on so i’m not sure. Any help please?

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Answer #1

encourage people to open new checking/savings accounts, tighter requirements on new loans, or sell some of their mortgages to other institutions.

Recently bank of america sold a crap load of mortgages to Green Tree financing to be able to meet its reserve ratio. I believe it was due to the thousands of people who closed their accounts with them this past year.

Answer #2

following actions not help the bank increase its reserves? A. Borrow reserves in the federal funds market

B. Make additional loans

C. Sell securities

D. Borrow reserves from a Federal Reserve bank

so by eliminating these reasons or factors, bank can meet its requires reserve ratio :)

Answer #3

If a bank is short money at the end of the day, i.e. do not meet their ratios, a lot of banks borrow money from other banks for just that purpose

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