statutory deposit

statutory deposit (plural statutory deposits)

1. An amount of money that a bank or insurance company is legally required to keep on hand rather than investing.
   • 2001, OECD, Insurance Regulation and Supervision in Asia and Latin America:

     Statutory deposit can function as a policyholders' protection fund.

   • 2004, Best's Key Rating Guide: Life/health, United States & Canada, page A-73:

     Of the $1.5 million, $900,000 is mandated to be a statutory deposit with this state.

   • 2014, F. Arnaboldi, Deposit Guarantee Schemes: A European Perspective:

     Both bank associations govern the respective statutory deposit funds and the voluntary deposit funds, but statutory and voluntary funds are kept legally separate.

• fractional reserve banking