[The once and future king]

No individual Bank can just "create" money, but the banking system as a whole can.

This can be easily evinced by looking at the following example:

Suppose that any one bank can lend 90% of its deposits. Now imagine that 10K is deposited at Bank A which then lends 9K, that is deposited at bank B which then lends 8100K which is then deposited at bank C which lends 7290 and so on.

10000> 9000
9000 > 8100
8100 > 7290
7290 > 6561
6561 > 5904
5904 > 5314
5314 > 4782
4682 > 4304
4304 > 3874
3874 > 3486

So you can see how from an original deposit of only 10K over 55K of loans can originate through the banking system, but at the same time each component will be able to show that deposits>loans or assets>liabilities.

The banking system can create debt backed by debt backed by debt and thus create money and in fact manages a currency system whereby debt=money.

The sleight of hand of the system is achieved by fostering the illusion that all the components are independent, therefore money can leave the doors of one bank as a liability and then arrive through the doors of another bank as an asset, where as in reality that money has just passed through components of a unified system. It is this alchemy of transforming liability into asset upon which are whole financial system depends.