The Eurosystem requires credit institutions established in the euro area to hold minimum reserves, primarily with a view to stabilizing money market interest rates and creating (or enlarging) a structural liquidity shortage. The reserve requirement of each institution is determined in relation to elements of its balance sheet. In the interest of stabilizing interest rates, the Eurosystem’s minimum reserve system enables institutions to make use of averaging provisions, i.e. compliance with the reserve requirement is determined on the basis of the institutions’ average daily reserve holdings over the maintenance period. Institutions’ holdings of required reserves are remunerated at the rate on the Eurosystem’s main refinancing operations.