> I think that's backwards. A bank is required to hold $100mm cash if it has $1b of demand deposits.

Yes. So it can loan out the other $900 million. Or, if it holds $1,111,111,111.11 it can loan out $1 billion.

> But it can hold all sorts of no-reserve-requirement deposits (like CDs) ... From that it can lend out whatever it wants

Yes, but in either case, it needs to have that $1 billion available to it in order to cut a $1 billion check. In neither case does a bank with only $100 million available get to loan out $1 billion, which is what it sounded like someone was suggesting.