Current deposits at the BoJ have topped Y40tn, more than five times as much as the reserves banks are required to keep.
The current level of core deposits could support ten percent more loans and still be at a very conservative ratio.
High bank reserve requirements of as much as 20% for timed deposits and 12% for current accounts keep banks from lending out too much money.
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That might be slightly naive at the moment considering the current political climate but, with extensive deposits of natural gas, oil and coal, along with gemstones such as rubies, emeralds and sapphires, there will be some people ready to risk investing in a country which has such a diversity of natural resources.
Current estimates put the combined bitumen in these deposits at 1.7 trillion barrels, and some geologists believe more field work will jack that number up a fair bit further.
The result is that demand for pesos is rising, so much so that restrictions on frozen current accounts were lifted in December and those on time deposits were loosened.
The competition is pushing up the rates offered on deposits (some online banks are paying as much as 6% on current accounts) and pushing down commissions on mutual-fund transactions, option trades and other deals.
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That would be no more intrusive than the current American rule stopping any one bank gaining more than a 10% market share of deposits by acquisition, a limit already touched by Bank of America.
These deposits were then lent out and with the losses that have been incurred have created the current situation.
"The simple fact is that the chancellor has made it clear that all existing deposits in Northern Rock are fully backed by the Bank of England and are totally secure during the current instability in the financial markets, " he said.
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