Everything you said there agrees with my understanding. The difference is that in aggregate the bank doesn't borrow deposits from its customers, it creates deposits for its customers. It's a subtle distinction. Maybe a more direct way of putting it is that the loanable funds model is observably incorrect.
As you note, creating a deposit is just a balance sheet expansion, limited only by reserve requirements and capitalization and not at all by the presence of any depositors. And currently in the USA there are no reserve requirements and as far as I can tell capitalization is largely a shell game of packaging loans into various financial instruments that satisfy the legal requirements and trading them with other banks.
I didn't know that about SPDIs, thanks. It certainly does diminish the value of the banking license if they can't create USD deposits like a normal bank.
As you note, creating a deposit is just a balance sheet expansion, limited only by reserve requirements and capitalization and not at all by the presence of any depositors. And currently in the USA there are no reserve requirements and as far as I can tell capitalization is largely a shell game of packaging loans into various financial instruments that satisfy the legal requirements and trading them with other banks.
I didn't know that about SPDIs, thanks. It certainly does diminish the value of the banking license if they can't create USD deposits like a normal bank.