[than3]

Yes, this is how its been classically taught, but it hasn't been true for some time now because they removed deposit reserve requirements in 2020 (set it to 0% and haven't changed it back).

Basel III utilizes complex risk formulas tied to specific asset classes for the basis of qualification and capital-based reserves which include stock market exposure (capitalization) counted as part of supplying part of their reserves.

Also, long-term issued debt (bonds) value reporting becomes fixed if they elect to hold them to maturity, with no further reporting needed (at least as far as I've been informed). This was one of the findings from Signature and a number of other banks.

The closest financial structure that describes the banking system is a government granted Ponzi scheme that's limited by rules set by unelected private institutions (Fed/FOMC).

Bubble pressures eventually cause an economic calculation problem which manifests in shortages.