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Increase in Cash Reserve Ratio leads to decrease in bank credit. Right or Wrong ?

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Question ajoutée par Mohammed Ashraf , Director of International Business , Saqr Al-Khayala Group
Date de publication: 2016/02/21
Khalid Ghaffar
par Khalid Ghaffar , Consultant for Business Development , Waters Corporation USA

Increasing the (reserve requirement) ratios reduces the volume of deposits that can be supported by a given level of reserves and, in the absence of other actions, reduces the money stock and raises the cost of credit. so its correct

Emad Mohammed said abdalla
par Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company

I fully agree with the answers been added by EXPERTS....THanks

Nijabdeen Mohammed Naleem
par Nijabdeen Mohammed Naleem , Senior Sales Manager , Realtor Lanka Properties (Pvt) Ltd

Yes agree with the statement.

 

Ahmad Alhusainy
par Ahmad Alhusainy , Customer Service , National Bank Of Kuwait - Nbk

correct I agree with statement

Vikas Bachhuka
par Vikas Bachhuka , Sales Manager - Tire, Lubs & Batteries , ALI ALGHANIM & SONS AUTOMOTIVE CO.

CRR is cash reserve ratio, it is the amount of money from every loan which a back has to set aside and deposit with the Reserve Bank.

 

Eg: The CRR is 5%, a bank has to deposit USD 5 with the reserve bank for every USD 100 it lends.

 

The money set aside for CRR does not earn any interest, hence the higher the CRR the higher will be the cost for the bank and subsequently borrowers to whom the bank lends money.

 

Concluding from the above the we can say that your statement is correct.

تحسين صوان
par تحسين صوان , محاسب رئيسي , ش العربيه لصناعه المواسير (شركه مساهمه عامه )

Yes correct..............................

Ahmed Mohamed Ayesh Sarkhi
par Ahmed Mohamed Ayesh Sarkhi , Shared Services Supervisor , Saudi Musheera Co. Ltd.

yes i agree with above words

 

Sidrah Nadeem
par Sidrah Nadeem , Global Marketing Manager , Hill & Knowlton

That's a correct statement.

Omar Saad Ibrahem Alhamadani
par Omar Saad Ibrahem Alhamadani , Snr. HR & Finance Officer , Sarri Zawetta Company

Thanks

Right .... i agree with statement

د Waleed
par د Waleed , Management - Leadership-Business Administration-HR&Training-Customer Service/Retention -Call Center , Multi Companies Categories: Auditing -Trade -Customer service -HR-IT&Internet -Training&Consultation

Yes Statement is right ... Nothing to add !

 Mr. Vikas''s answer was clear about that.

 

Thank You

Gayasuddin Mohammed
par Gayasuddin Mohammed , Advocate , Practicing Law before High Court at Hyderabad

Yes. Agree with the answer of Mr. Khalid Gaffar. Thanks.