Obviously things would get really bad if everyone who uses the bank wanted to withdraw all their cash at once.
This is called a "bank run" and the result is that not everyone gets all their money because there simply isn't enough cash to cover all the IOU's the bank has created.
So there are rules about how much a bank is allowed to create money.
For example, if the bank gets $100 from me, there is a fraction they are required to keep "in reserve" and not loan out.
In the US and many other countries there is also something called "deposit insurance,"
which protects a certain amount of money in your bank account from this type of situation.
Banks, Like JP Morgan and Goldman Sachs, are developing their blockchain technology to compete.