excess reserves

excess reserves definition - finance
The amount of money that a bank has on deposit with the Federal Reserve that is above what is required by the Federal Reserve. If a bank is required to have $300 million in reserves and has $350 million on deposit, then its excess reserves are $50 million.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

Comments
Improve this definition.
Do you have more to add? Share your linguistic knowledge or observation.
/Register to save your comments.