Federal Reserve denies The Narrow Bank s master account application americanbanker.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from americanbanker.com Daily Mail and Mail on Sunday newspapers.
While the central bank's reverse-repurchase facility generally works to stabilize the financial system, under certain circumstances it would spark a rapid flow of deposits out of banks. A growth cap would prevent that problem.
The Narrow Bank upended the traditional banking model by proposing to park depositors’ funds solely in risk-free reserves at the Fed. The regulator was not impressed.