"In one place they state "In reality, neither are reserves a binding constraint on lending," and in another "But whether through deposits or other liabilities,

"In one place they state "In reality, neither are reserves a binding constraint on lending," and in another "But whether through deposits or other liabilities, the bank would need to make sure it was attracting and retaining some kind of funds in order to keep expanding lending", right after writing about running out of reserves, a direct contradiction." It isn't is it. Central bank reserves are an asset of a commercial bank. Deposits are liabilities of commercial banks. Suggesting people at the Bank of England don't know how banking and central banking works is a bit hubristic don't you think. The process they are talking about is the one that causes the central bank interest rate to bind [0] [0]: https://new-wayland.com/blog/why-banks-pay-interest-on-deposits/ https://new-wayland.com/blog/why-banks-pay-interest-on-depos... The central bank simply threatens to operate as a wholesale depositor at a particular price. "Central banks lend money and that's how money is created. " They don't. They merely threaten. Commercial banks rarely borrow from the central bank. Central banks discount assets into their own liabilities - just like every other bank. They just tend to stick to government securities. They do that reflexively at a particular price, because if they tried to do it at a quantity they would lose control of their interest rate and cause the payment system to collapse. That's what QE is - additional discounting of government securities into bank reserves. Which then requires there to be a support rate paid on reserves or the interest rate would drop to zero or thereabouts. Those reserves come from government spending more than it taxes, and that's what the central bank is discounting. In technical terms the commercial bank lends to the central bank, not the other way around. The commercial bank has the asset, and the central bank the liability. Just like a deposit at a bank lends to the bank. Hence why you are 'in credit'. Credit being the accounting term for a liability. There is no such thing as a money multiplier and never has been. Loans create deposits. Deposits which are then used, in part, to swap for bank equity and bonds which creates the 'assets > liabilities' buffer in the banks. It's back filled, not front run. Reserves have no quantity controlling power, and are merely an optimisation. You don't need them at all to do banking.