Banks [Archive] - Wizards Community - Pages Merged by Solauren

Banks [Archive] - Wizards Community

Post/Author/DateTime Post
Vaalingrade Ashland
03-03-04, 04:59 PM Two tiered Question:

First, my PCs are stinkin' rich (Epic) and a couple want to start having buisness with the Planar Trade Affiliation Bank, which I've hinted at, but haven't had to wrok with.
At the same time, the group leader wants to start running a loan shark opperation out of thier city/ship, in addition to the tax she levvied.

Now, I suck at numbers, and its all I can do to manage thier other buisness ventures (trade contract, installation of a permenant Gate on the ship, etc) Now they want to do banking.

Anyone have any idea how I should run this? All I have so far is that that the PTA bank provided ivory plates, magically scribed to represent denominations of 10, 100, 500, 1000 platnum.
Not a monkey
03-03-04, 05:30 PM Well, start with simple interest on loans and deposits. Don't worry about compounding; time tends to get messed up in-game. Just do the simple "Give us 120% of this loan in 3 months, or Big Og will arrange for you to need some healing".
Burgundy Lotus
03-03-04, 05:42 PM What kind of bank is it?

The first banks of the period in RL were just places where investers got together to pool money for merchantile investments.

It was after this that the first real banks appeared, these were like the above but also gave loans and held a persons money, for a fee.

Or is it like a bank of today where the person can put thier money in and actually expect to collect interest? (wait... I don't think banks give interest anymore :nonono:
Obsidianjaerc
03-03-04, 06:11 PM I think I can help to flesh out the PTAB a bit ( Your second question) as I end up using a similar organization when running in cities like Sigil and Union.

First off how cheap is ivory in your multiverse? If its fairly expensive its a bad idea. Use something really , really cheap. I.e. magically hardened bones or even paper.

Also you should decide if they have the platinum to back up the plates. This will greatly effect the multiverse if the PCs look to closley.

One more question. Who runs the bank? If you have yet to decide it would be expedient to use those...oh what are they called...the blue guys from ELH (sorry I cant look it up , my ELH is loaned out right now).
aka Jimmy
03-03-04, 06:26 PM A "loan shark" operation would be very reasonable. Such things are as old as civilization. However, they are also usually outright illegal, heavily regulated, or proscribed by religion. For instance, the Old Testament says usury is a sin, and the meaning of the word that was translated as "usury" at the time* meant "charging any interest at all on loaned money"... so the entire basis of capitalism is actually a sin according to religions which believe in the Old Testament.

*note: the meaning of usury has changed over time to accomodate changing social norms. Wheras charging an interest at all was a sin back when the old testament was written down, the common perception of the practice has changed over time. The current definition of usury is charging "too much" interest on a loan. How much is "too much" is generally a question open to debate.

Anyway, unless the characters are the absolute "top dogs" of their society (EG: not answerable to any church or worldly power) then they can charge whatever the hell they want to loan out money. Of course if they charge too much people just wont do it...
However, if there are persons or organizations who outranks the players they almost certainly will have something to say about it. (pretty much every civilization in history has). They will either:
1) Disallow the practice outright.
2) Regulate the interest rate
In any case they will probably demand a cut of the profit for themselves. (especially if it is a church/religion... even if they consider the practice a sin...)

Also remember that if the PCs are charging a high interest rate and there are any other sources of capital available then people who can will use those other sources instead of the PCs. This means that the only people who will take out loans with the PC "loan sharks" are those persons who cannot get loans elsewhere. This means they are a bad credit risk. The more interest the PCs charge compared to other lenders, the more of their loans will go "bad" (eg: the person is unable to pay them back).
Vaalingrade Ashland
03-03-04, 06:47 PM 1) Ivory is ridiculously easy to aquire for the PTAB because they can go anywhere. The downside is, on non-PTAB worlds (most of them) its worthless except for the ivory its printed on.

2) The PTAB has the wealth to back thier currency as well as a monopoly on the magic that makes the plates

3) While the Mercanes (blue guys) are present in the system, the PTAB is run by a joint council made up of leaders from each of the 300+ PTAB planes.

4) The PCs, by virtue of thier ship are more or less an autonomous government (population 2298), though too small to join the PTAB, there's really no one for them to answer to unless they step on someone's tail (like the PTAB, or some other plane spanning organization)

Thanks for helping me out with this :)
aka Jimmy
03-03-04, 07:07 PM Originally posted by Vaalingrade Ashland
1) Ivory is ridiculously easy to aquire for the PTAB because they can go anywhere. The downside is, on non-PTAB worlds (most of them) its worthless except for the ivory its printed on.

2) The PTAB has the wealth to back thier currency as well as a monopoly on the magic that makes the plates

3) While the Mercanes (blue guys) are present in the system, the PTAB is run by a joint council made up of leaders from each of the 300+ PTAB planes.

4) The PCs, by virtue of thier ship are more or less an autonomous government (population 2298), though too small to join the PTAB, there's really no one for them to answer to unless they step on someone's tail (like the PTAB, or some other plane spanning organization)

Thanks for helping me out with this :)

Hmm, well in that case the system with ivory bank notes makes sense. It also gives you some nice adventure hooks. Remember that the value of currency (and these banks notes are a primitive form of currency) is based entirely on the perception of those persons trading it. If they perceive (whether this is true or not) that perhaps the PTAB is undergoing financial trouble they will place less value on their bank notes. What if someone tries to undermine the value of this currency? The PCs could suddenly "lose" half their wealth or more overnight without actually losing a single note. :)

As to the loan sharking, also remember that people have a deep seated dislike/resentment for those they owe money to. If a large population of the PCs subjects owes them money at an interest rate which is burdensome to them, it will forment discord and civil discontent. This could lead to mass emmigration or even rebelion.
Ankalagon
03-04-04, 03:18 AM It's been a while since I studied banking so please excuse any inaccuracies.

There is a banking ratio of Cash to credit, I think it's about 1-17. That is you can lend out about 17 times your actual stock pile of cash (used to be actual Gold) to make money in interest charges.
The theory being people will only ever take a small mount of their actual cash out at any one time.

However years ago when there were many banks they got this wrong and so went out of business. Also their competition would make lots of large deposits, wait for the bank to make loans and then demand their cash, thus putting the banks out of business.

If you wished you could have the competition try and put them out of business.

You could also look into a credit card with a crystal ball or something (that would be a D&D service worth charging for).
Autosponge
03-04-04, 09:37 AM They have to take the skill Profession (Banker) and make a roll. The DC should reflect the interest rate they are charging. If they succeed, they have an income that month of X times the number they beat the DC by (they can take 10 on this roll).

If they fail their Banker roll, they made a bad decision regarding one of their customers and they will need to make an Intimidation check (or Diplomacy if you want) to see if they take a loss. Again, the rate of interest determines the DC here and successfull intimidation means they got their money back. Again, you'll need to set a multiplier for this and if they fail here, they will lose X times the number they missed the roll by for that month.
Bluebrush
03-04-04, 11:22 AM It could be possible for you to run a no-interest bank.

Basically the bank takes the money and guards it for their customers. In exchange the bank uses the money for buisness ventures/loans and such and uses some of the profits to build, staff and maintain a stronghold to guard the huge piles of gold the bank must have.

Post/Author/DateTime	Post
Vaalingrade Ashland 03-03-04, 04:59 PM	Two tiered Question: First, my PCs are stinkin' rich (Epic) and a couple want to start having buisness with the Planar Trade Affiliation Bank, which I've hinted at, but haven't had to wrok with. At the same time, the group leader wants to start running a loan shark opperation out of thier city/ship, in addition to the tax she levvied. Now, I suck at numbers, and its all I can do to manage thier other buisness ventures (trade contract, installation of a permenant Gate on the ship, etc) Now they want to do banking. Anyone have any idea how I should run this? All I have so far is that that the PTA bank provided ivory plates, magically scribed to represent denominations of 10, 100, 500, 1000 platnum.
Not a monkey 03-03-04, 05:30 PM	Well, start with simple interest on loans and deposits. Don't worry about compounding; time tends to get messed up in-game. Just do the simple "Give us 120% of this loan in 3 months, or Big Og will arrange for you to need some healing".
Burgundy Lotus 03-03-04, 05:42 PM	What kind of bank is it? The first banks of the period in RL were just places where investers got together to pool money for merchantile investments. It was after this that the first real banks appeared, these were like the above but also gave loans and held a persons money, for a fee. Or is it like a bank of today where the person can put thier money in and actually expect to collect interest? (wait... I don't think banks give interest anymore :nonono:
Obsidianjaerc 03-03-04, 06:11 PM	I think I can help to flesh out the PTAB a bit ( Your second question) as I end up using a similar organization when running in cities like Sigil and Union. First off how cheap is ivory in your multiverse? If its fairly expensive its a bad idea. Use something really , really cheap. I.e. magically hardened bones or even paper. Also you should decide if they have the platinum to back up the plates. This will greatly effect the multiverse if the PCs look to closley. One more question. Who runs the bank? If you have yet to decide it would be expedient to use those...oh what are they called...the blue guys from ELH (sorry I cant look it up , my ELH is loaned out right now).
aka Jimmy 03-03-04, 06:26 PM	A "loan shark" operation would be very reasonable. Such things are as old as civilization. However, they are also usually outright illegal, heavily regulated, or proscribed by religion. For instance, the Old Testament says usury is a sin, and the meaning of the word that was translated as "usury" at the time* meant "charging any interest at all on loaned money"... so the entire basis of capitalism is actually a sin according to religions which believe in the Old Testament. *note: the meaning of usury has changed over time to accomodate changing social norms. Wheras charging an interest at all was a sin back when the old testament was written down, the common perception of the practice has changed over time. The current definition of usury is charging "too much" interest on a loan. How much is "too much" is generally a question open to debate. Anyway, unless the characters are the absolute "top dogs" of their society (EG: not answerable to any church or worldly power) then they can charge whatever the hell they want to loan out money. Of course if they charge too much people just wont do it... However, if there are persons or organizations who outranks the players they almost certainly will have something to say about it. (pretty much every civilization in history has). They will either: 1) Disallow the practice outright. 2) Regulate the interest rate In any case they will probably demand a cut of the profit for themselves. (especially if it is a church/religion... even if they consider the practice a sin...) Also remember that if the PCs are charging a high interest rate and there are any other sources of capital available then people who can will use those other sources instead of the PCs. This means that the only people who will take out loans with the PC "loan sharks" are those persons who cannot get loans elsewhere. This means they are a bad credit risk. The more interest the PCs charge compared to other lenders, the more of their loans will go "bad" (eg: the person is unable to pay them back).
Vaalingrade Ashland 03-03-04, 06:47 PM	1) Ivory is ridiculously easy to aquire for the PTAB because they can go anywhere. The downside is, on non-PTAB worlds (most of them) its worthless except for the ivory its printed on. 2) The PTAB has the wealth to back thier currency as well as a monopoly on the magic that makes the plates 3) While the Mercanes (blue guys) are present in the system, the PTAB is run by a joint council made up of leaders from each of the 300+ PTAB planes. 4) The PCs, by virtue of thier ship are more or less an autonomous government (population 2298), though too small to join the PTAB, there's really no one for them to answer to unless they step on someone's tail (like the PTAB, or some other plane spanning organization) Thanks for helping me out with this :)
aka Jimmy 03-03-04, 07:07 PM	Originally posted by Vaalingrade Ashland 1) Ivory is ridiculously easy to aquire for the PTAB because they can go anywhere. The downside is, on non-PTAB worlds (most of them) its worthless except for the ivory its printed on. 2) The PTAB has the wealth to back thier currency as well as a monopoly on the magic that makes the plates 3) While the Mercanes (blue guys) are present in the system, the PTAB is run by a joint council made up of leaders from each of the 300+ PTAB planes. 4) The PCs, by virtue of thier ship are more or less an autonomous government (population 2298), though too small to join the PTAB, there's really no one for them to answer to unless they step on someone's tail (like the PTAB, or some other plane spanning organization) Thanks for helping me out with this :) Hmm, well in that case the system with ivory bank notes makes sense. It also gives you some nice adventure hooks. Remember that the value of currency (and these banks notes are a primitive form of currency) is based entirely on the perception of those persons trading it. If they perceive (whether this is true or not) that perhaps the PTAB is undergoing financial trouble they will place less value on their bank notes. What if someone tries to undermine the value of this currency? The PCs could suddenly "lose" half their wealth or more overnight without actually losing a single note. :) As to the loan sharking, also remember that people have a deep seated dislike/resentment for those they owe money to. If a large population of the PCs subjects owes them money at an interest rate which is burdensome to them, it will forment discord and civil discontent. This could lead to mass emmigration or even rebelion.
Ankalagon 03-04-04, 03:18 AM	It's been a while since I studied banking so please excuse any inaccuracies. There is a banking ratio of Cash to credit, I think it's about 1-17. That is you can lend out about 17 times your actual stock pile of cash (used to be actual Gold) to make money in interest charges. The theory being people will only ever take a small mount of their actual cash out at any one time. However years ago when there were many banks they got this wrong and so went out of business. Also their competition would make lots of large deposits, wait for the bank to make loans and then demand their cash, thus putting the banks out of business. If you wished you could have the competition try and put them out of business. You could also look into a credit card with a crystal ball or something (that would be a D&D service worth charging for).
Autosponge 03-04-04, 09:37 AM	They have to take the skill Profession (Banker) and make a roll. The DC should reflect the interest rate they are charging. If they succeed, they have an income that month of X times the number they beat the DC by (they can take 10 on this roll). If they fail their Banker roll, they made a bad decision regarding one of their customers and they will need to make an Intimidation check (or Diplomacy if you want) to see if they take a loss. Again, the rate of interest determines the DC here and successfull intimidation means they got their money back. Again, you'll need to set a multiplier for this and if they fail here, they will lose X times the number they missed the roll by for that month.
Bluebrush 03-04-04, 11:22 AM	It could be possible for you to run a no-interest bank. Basically the bank takes the money and guards it for their customers. In exchange the bank uses the money for buisness ventures/loans and such and uses some of the profits to build, staff and maintain a stronghold to guard the huge piles of gold the bank must have.