alt Hacker NewsLoans create deposits, deposits are used to buy bank capital issued by banks.
There’s no hard limits. They are ratios which are preprepared because a bank knows how big its sales pipeline is and that takes time to complete.
Nothing is limited in quantity. Even the silly SLR they have in the US is a pricing limit, not a quantity - as we see every time somebody moans about how much the deficit has gone up.
> There’s no hard limits. They are ratios
Ratios are limits!
> Nothing is limited in quantity
Of course it is. At a certain point, compliance will say you literally cannot issue loans of certain types because of capital or liquidity ratios. If compliance fails to do that, regulators come in and yell at everyone.