How To Calculate Reserves In Balance Sheet How To Calculate Reserves In Balance Sheet How To Calculate Reserves In Balance Sheet Federal Reserve System. Assets. Liabilities. Government Securities and Mortgage Backed Securities. Currency in circulation. Discount loans. Reserves. Monetary Liabilities. Currency in circulation(in the hands of the public) Reserves: bank deposits at the Fed. Assets. Government securities: holdings by the Fed that affect money supply and earn interest. Fed now holding MBS. Discount loans: provide reserves to banks and earn the discount rate.