Tuesday, May 12, 2015

Reserve Requirements in America and Singapore

To learn more about the American Federal Reserve requirements, check out the table below and visit the linked title. Under the American requirements are the Singaporean minimum cash balances (reserve requirements). You can see that Singapore has a lower requirement of 3%, compared to America's 10% on balances over $103.6 million dollars.

Federal Reserve Requirements


Liability TypeRequirement
% of liabilitiesEffective date
Net transaction accounts 1
$0 to $14.5 million201-22-15
More than $14.5 million to $103.6 million331-22-15
More than $103.6 million101-22-15
Nonpersonal time deposits012-27-90
Eurocurrency liabilities012-27-90


4 A bank shall, during a maintenance period, maintain in its Current
Account and Custody Cash Account, an aggregate minimum cash
balance of at least an average of 3% of its average Qualifying Liabilities
(referred to as “MCB requirement”) computed during a computation
period.


Singapore Ups Reserve Requirements For 20 Banks As Censure For Rate Manipulation

"Singapore's monetary regulator announced Friday that it's censuring at least 20 banks for trying to rig benchmark interest rates and ordered them to set aside hefty reserves. The Monetary Authority of Singapore also said it had identified 133 traders that participated in the manipulation and that some of them will be investigated by the country’s white collar crimes unit."
What are the effects of a move like this? How does it change the supply of money?

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