What are some results of a high reserve requirements?

High reserve requirements can lead to reduced money supply in the economy, as banks are mandated to hold a larger portion of their deposits in reserve rather than lending them out. This can limit the availability of loans for consumers and businesses, potentially slowing economic growth. Additionally, higher reserve requirements may increase the cost of borrowing and lead to higher interest rates, as banks seek to compensate for reduced lending capacity. Overall, while they can help stabilize the banking system, they may also hinder economic expansion.