Final answer:
The Federal Reserve Bank accepts deposits from banks and thrifts for any portion of their mandated reserves not held as vault cash. Reserve requirements used to vary based on the volume of deposits, but as of March 2020, all requirements were set to 0% due to the pandemic-induced recession.
Step-by-step explanation:
The entity that accepts as deposits from banks and thrifts any portion of their mandated reserves not held as vault cash is the Federal Reserve Bank. Reserve requirements are a certain percentage of funds that depository institutions such as banks must hold in reserve against specified deposit liabilities. These reserves can be held either as physical cash in the institution's vault ('vault cash') or as deposits at the Federal Reserve Bank.
Prior to March 2020, the Reserve requirements had specific thresholds based on the amount of deposits a bank had. However, with the onset of the pandemic-induced recession, the Federal Reserve reduced the reserve requirements to 0%, effectively eliminating the reserve requirement for all depository institutions. Despite the elimination of reserve requirements, banks often maintain reserves to manage liquidity and for regulatory compliance, as the level of reserves can still be used as a tool to influence bank behavior.