Non-Borrowed Reserves

AAA

DEFINITION of 'Non-Borrowed Reserves'

A measure of the reserves in the banking system. Non-borrowed reserves represent the numerical difference between total reserves minus funds that have been borrowed from the Fed discount window.

The first element of this equation consists of the total reserves held at deposit at the Fed by member banks plus the composite cash in their vaults. The second element is money borrowed by banks through the Fed discount window.

INVESTOPEDIA EXPLAINS 'Non-Borrowed Reserves'

The total amount of non-borrowed reserves is computed each week by the Federal Reserve Bank. The level of reserves is sometimes targeted by adjusting the Fed funds rate to implement monetary policies. Although the arithmetic computation of non-borrowed reserves is quite simple, the underlying factors that sometimes affect this number can be quite complex.

RELATED TERMS
  1. Lagged Reserves

    A method of bank reserve calculation whereby the financial institution ...
  2. Free Reserves

    A measurement of a bank's reserves that is equal to the difference ...
  3. Capital Reserve

    A type of account on a municipality's or company's balance sheet ...
  4. Excess Reserves

    Capital reserves held by a bank or financial institution in excess ...
  5. Reserve Fund

    An account set aside by an individual or business to meet any ...
  6. Wall Street Journal Prime Rate

    An interest rate that large banks in the United States charge ...
Related Articles
  1. Investing

    What are the generally accepted accounting principles for inventory reserves?

    As with most matters related to generally accepted accounting principles (GAAP), accountants assigned with the task of applying GAAP to inventory reserves often use a significant amount of personal ...
  2. Active Trading

    Oil And Gas Industry Primer

    Before jumping into this hot sector, learn how these companies make their money.
  3. Economics

    In what instances is quantitative easing used?

    Discover when, how and why the Federal Reserve and other central banks turn to quantitative easing to stimulate economic activity.
  4. Economics

    How does the Federal Reserve determine the discount rate?

    Learn about the several different kind of discount rates offered to banks and other depository institutions through the Federal Reserve's discount window.
  5. Economics

    What is the difference between fiscal policy and monetary policy?

    Utilizing founding principles of macroeconomics through both fiscal and monetary policy can have drastic effects on a country's economic state.
  6. Investing

    Reassessing Your Approach To Bond Investing

    Rethinking your fixed-income portfolio may not resonate in quite the same way as dropping 10 pounds or finally giving up that smoking habit.
  7. Bonds & Fixed Income

    How are treasury bill interest rates determined?

    Find out why interest rates for U.S. Treasury bills are determined at auction and how so-called "competitive" bidders impact returns on these debt securities.
  8. Bonds & Fixed Income

    How do treasury bill prices affect other investments?

    Find out how the price and yield of Treasury bills can impact the level of risk investors are willing to accept in their securities.
  9. Bonds & Fixed Income

    How does quantitative easing in the U.S. affect the bond market?

    See why it is very difficult to evaluate the impact of the Federal Reserve's quantitative easing, or QE, program on bond prices and yields.
  10. Economics

    What impact does quantitative easing have on consumers in the U.S.?

    Dig deeper into the Federal Reserve's quantitative easing policies and what potential impacts they may have on American consumers.

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center