4 ms·

And how is the central bank involved in this?

• nradov 5y ago
  The central bank provides liquidity to member banks in case of a bank run, and imposes limits on money creation (lending) based on capital reserves and other factors.
• dragonwriter 5y ago
  > And how is the central bank involved in this? Via reserve requirements and coordinating interbank lending: https://www.investopedia.com/terms/i/interbankrate.asp https://www.investopedia.com/terms/i/interbankrate.asp