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Using Call Report microdata from 2001 to 2024, this paper shows that 39.2 percent of retail-franchise banks, holding 10.4 percent of sample deposits, fall below the historic 10 percent reserve-buffer benchmark. The lower tail emerged after reserve requirements went to zero and is concentrated among mid-sized, transaction-account-intensive banks.

This project studies whether the Federal Reserve’s 2020 elimination of reserve requirements changed bank balance-sheet allocation and lending.