The mechanics are incorrect but he has the general idea of the benefit banks accrue from each additional deposited dollar.

Highly recommend reading Steve Keen's "The Roving Cavaliers of Credit" for a dose of reality on the whole process.

tl;dr "banks extend credit, cre­at­ing deposits in the process, and look for reserves later"

http://www.debtdeflation.com/blogs/2009/01/31/therovingcaval...

You will find no dispute from me as to whether banks actually do restrict themselves to limiting their credit creation to a ratio of their deposits. But that is how it is supposed to work.