How much cash deposit is suspicious?
Commercial banks do not keep all of their deposited funds sitting as physical paper currency in branch vaults, as they operate under a fractional reserve and liquidity management system. Federal regulations and internal risk models dictate that banks maintain a specific percentage of cash on hand—known as vault cash and Federal Reserve balances—to satisfy daily customer withdrawal demands, ATM servicing, and routine branch operations. Typically, individual retail bank branches keep anywhere from several hundred thousand dollars to a few million dollars in physical cash on hand, heavily dependent on the branch size, local population density, and commercial business traffic. The vast majority of a bank's total customer deposits are not kept as physical cash in drawers, but rather deployed into loans, government securities, mortgages, and interbank investments.
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