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1) that's your opinion. They leverage those reserves as a means to lend. So yes they do use them.
Banks don't leverage reserves. Banks lend by expanding their balance sheets. Reserves only come into play after the fact, and not in any sort of leveraging way. If excess reserves were low, and if the Fed didn't accommodate the banks' need for reserves based on demand, then your use of the word "leverage" might carry some weight, but reserves are simply not a limiting factor, so they are not even something that can be leveraged.
2) Banks look for the best margin of profit with least risk. If a Bank can use it's reserves which is paying .5% and get Treasuries at .5% to 2% (short term to long term), Banks are gonna make between 0% to 1.5% with NO risk. This has been the case for almost 8 years. So what you want to do is raise the cost of borrowing within the banks on excess reserves. So you hike that to squash the Bond trade ( basically 1% FFR). Banks will seek higher returns (profit margins) when Banks can't make the no risk trade (bonds). They will seek out moves (loans to those who are paying 2 plus %.
Banks have always made some safe profits on their excess reserves; before IOR, they bought Treasuries or loaned out excess reserves. But banks lend whenever there are creditworthy borrowers - and the existence of creditworthy borrowers is not something that banks can control. Can you point to a time when banks turned down creditworthy borrowers (and their higher returns) in favor of simply holding reserves/treasuries? You talk about this as if it were all a matter of tweaking bond yields in order to convince banks to release reserves to borrowers, which is wrong on many levels.