Preview screenshot of a bank HQ

[David]

Here is a preview screenshot of the bank Headquarters.

[Brain]

Nice, can you provide a screenshot for the loans section?
do you develop fractional banking? interbanking transactions, money flows? will players borrow at one or more of these banks?

[lillud321]

Thank you for the update !

I've been wondering since the annooncement of this DLC. Will the banks be playable the same ways as a compagnie ? I kind of hope not and hear are son différences i would make

1- For me , a compagnie that wants to open a bank should have a pretty big investement capital ( a least a billion dollars ) to put into the bank and it should be played a bit like a Subsidiary compagnie . So the Financial situation of the bank would be seperated from your own . And it would give the possibility of having a bank own by more than one player ( but you would need to be the majority stocks holder to contrôle it). Because lets be honest , Apple would not open a bank Under its own name so by doing the subsidiary way it would be more realistic. And i would kind of find it wied to open a bank the same way you open a car dealership.

2- There should be a limit on the number of banks that can be opened in a game because i would kind of fidn it wierd seeing 15 banks for a game with 15 companies. By limting the number, you could make it that one of your normal competitors could even take a loan in your bank. Thus making it realistic because in real life there are people who take loans but also compagnies.

Thank you for the great game

( sorry for the English mistake ( I normaly work in french)

[lillud321]

I was forgetting something else

3- I would like to have the opportunity to put my own money in the bank i own by the subsidiary and even take a loan if needed. Of course , i would get treated the same way as any Customer ( so no taking loans at 0% interest).

[David]

Nice, can you provide a screenshot for the loans section?

Here you go.

[BioBiro]

Looks fantastic! Can't wait for this to be released .

[Brain]

It looks like they get fractional banking not at all here :/

[David]

It looks like they get fractional banking not at all here :/

It seems that it can be simulated by the player by setting the "Maximum Loan as a Percentage of Total Customer Deposits", doesn't it?

[Brain]

In fractional banking banks have to deposit a certain ratio of their customers account deposits at the central bank. This is one of the instruments how central banks control money creation at business banks, to dampen economic cycles.
Lets explain it with a small example. Imagine there is just one bank that has two customers. Person 1 has a savings account of $1,000. The bank pays him some nice 3% interest per year, that is $30. The bank must deposit 10% of this account balance at the central bank as fractional reserve. That is $100. $900 is free capital of the bank that can be used for other purposes like loan creation. That does not mean that customer number 2 can get a maximum credit of $900. Most people think banks can loan only what is in their capital. $900 is defining how much deposit to the central bank can be done in maximum after creating the loan. The maximum credit the bank can give is $9,000 because if it transfers that sum into Person 2's account it needs to transfer 10% ($900) into its central bank account so that its actual capital is 100% bound to its liabilities, its liquidity is zero now. And on those $9,000 it receives about 10% interest, that is $900 per year. While it spends 30$ on interest to the original customer. Bank gains $870 per year.
Of course this only works to this extreme if there is only one bank that holds all the accounts. If there are more banks and customers this gets intensely more complicated as banking is the mirror side of business transactions, company A pays for goods of company B at a different bank, so money flows between these banks back and forth and some liquidity needs to be kept in reserve for that.
But just as an example how insanity infested the real world is: given we have two banks now, and person 2 buys a car from person number 3 who has an account with bank number 2. Bank number 2 has now a liquidity of $9,000 in its accounts and deposits $900 at the central bank and can use the remaining $8,100 for its business... If bank 2 has really just these $1,000 in its capital this won't work as it would be bankrupt now. But banks can take loans, too, usually at much better conditions...

I recommend to watch this video for the explanation on how fractional banking works in the USA (and in general): https://www.youtube.com/watch?v=P-5xDzTvW6E and https://www.youtube.com/watch?v=iFDe5kUUyT0

In a banking simulation the players must maintain their bank accounts at a bank institute, which is currently an abstract. In the DLC I expect players to have relationships with banks and banks can offer players loans, based on their liquidity.
Wouldn't it be fun to simulate banking crunch?

[David]

Thanks for the info.

Why is it so important to have the fractional banking system in the game?

By the way, there are old posts discussing something related on http://www.enlight.com/forum/viewtopic. ... 497#p11650