If the bank you own has no excess reserves and a sound customer comes in asking for a loan, should you automatically turn the customer down, explaining that you don’t have any excess reserves to lend out? Why or why not? What options are available that will enable you to provide the funds your customer needs?

The bank you own has no abundance saves and a sound client comes in requesting an advance.

A proper customer arrives at the bank requesting for the loan but the bank has no extra reserves. there are different movements that the bank can take to obtain the best result from this crisis.

The customer should not be turned down by simply saying the reason as a bank is short of extra funds. this is because; the bank may be lost the customer's business

permanently as the customer will never come to the bank again. it is also not advisable to turn down a customer as it is a costly decision for the bank.

The various options available with the bank to provide funds to customer are as follows:

• Borrowing funds from other banks or corporations,
• Obtaining funds from Fed, and
• Selling negotiable checkable deposits or securities.

These options will help the bank not to lose customer and at the same time satisfy customer's needs.