How much money can a bank loan out?
A legal lending limit is the most a bank or thrift can lend to a single borrower. The legal limit for national banks is 15% of the bank’s capital. If the loan is secured by readily marketable securities, the limit is raised by 10%, bringing the total to 25%.
Do banks want to lend money?
Expectations of profitability, then, remain one of the leading constraints on banks’ ability, or better, willingness, to lend. And it is for this reason that although banks don’t need your money, they do want your money. As noted above, banks lend first and look for reserves later, but they do look for the reserves.
Do banks loan your money to other people?
Banks use the money in deposit accounts to make loans to other people or businesses. In return, the bank receives interest payments on those loans from borrowers.