Jones deposits ,000 at bank A. With a 0.1 reserve ratio, bank A can lend out 0 of that deposit and keep 0 on hand as reserves. Let us say they lend out 0 and it makes its way to Smith — either he borrowed it, or the real borrower used it to pay him. Smith now has 0 that he deposits at another bank, B. Bank B, in turn, keeps as reserve (10% of 0) and lends out 0 to someone else. This 0 is spent and deposited at bank C, which keeps as reserves and lends out 9 to someone else. As this process continues, the total amount lent out by the various banks in the system adds up: 0 + 0 + 9 + …. The sum of this series is ,000. The total held in reserve also adds up: 0 + + + … = ,000. Thus ,000 of lending is supported by ,000 in reserves. This is why most commentators will state that fractional reserve banking allows the lending of multiples of reserves. Technically, it is not the bank that received the initial deposit that can lend out a multiple, but rather the system as a whole creates it through the process described above.