The cash reserves that commercial banks are legally required to keep are held in the form of at the South African Reserve Bank, where they earn no interest.

Reserves of cash kept with itself by a bank to meet its payment requirements is called

The requirement is the fraction of checkable deposits that banks must keep on hand as reserves either as currency or on deposit with the Federal Reserve.

All financial institutions have to maintain a certain quantity of liquid assets with themselves , these reserves are known as  A. Cash Reserve Ratio  B. Foreign reserves  C. Statutory Liquidity Ratio  D. Debt to GDP Ratio

c. In South Africa, the debts of government and commercial banks are used as money. This statement acknowledges that multiple choice 3many governments and commercial banks have debt.government finances its spending through debt.accounts in commercial banks are customer deposits and thus are debts of commercial banks.money is created by a lending process.

Why does cash reserves typically account for a small proportion of a bank's assets? A bank makes higher returns by holding more liquid assets such as loans. It is expensive to keep too much cash in highly secured vaults. Cash reserves are very liquid, and it is risky for banks to have too much liquidity. Cash reserves are held in vaults and therefore not electronically transferrable between banks. A bank makes higher returns by holding riskier assets such as loans.