Agency 9: Industrial Bank
The ninth agency in the community, and third in the Economic Bureau is the Industrial Bank Agency. The agency provides villages with loans that they need to procure equipment and to factor inventory and accounts receivable. The agency also develops and manages the community storehouse. With these roles, the agency enables a vibrant economy by boosting production and promoting the full employment of resources.
The Industrial Bank Agency is served by an executive presidency. The presidency, together with those of the other two agencies that are part of the Economic Bureau – the Commercial Bank (agency 7) and the Capital Bank (agency 8) – form a bureau board. The Economic Bureau serves as the community’s economic anchor. It is responsible for shaping the community’s economy through its choices of investment, lending, and interest rates.
How the Industrial Bank works
The Industrial Bank Agency does not have other presidencies or agencies serving it besides the executive presidency. The presidency’s responsibility is to formulate and review the agency’s policies. For its operational duties, the agency relies on a highly automated system that carries out virtually all the agency’s objectives. Villages apply for and receive loans without having to engage the executive presidency directly. The agency also runs a system to manage the storehouse. This system allocates space and awards contracts to limited partners for maintenance and management. Revenue collection and loan repayments are also automated. The executive presidency regularly reviews the system’s performance and makes adjustments where necessary.
The job of the Industrial Bank would be impossible without the 96 village presidencies for business operations and 960 branch presidencies. The village and branch presidencies are the interface between the agency and limited partners. They deliver services that are enabled by the Industrial Bank. Factoring, a core function of the village presidencies for business operations, is funded with loans from the Industrial Bank.
Branch presidencies are the primary point of contact between participants and other community presidencies, and agencies. They are the first port of call when a participant is unable to navigate the system. The branch and village presidencies also help the Industrial Bank’s executive presidency in reviewing strategy and adjusting the system to better respond to participants’ needs.
Roles of the bank
To achieve its mandate, the Industrial Bank Agency provides loans to villages so that they can acquire assets on behalf of the Business Operations Agency (agency 3), and ultimately, the community. The loans are also used in inventory and accounts receivable factoring.
Providing loans to villages for asset acquisition and factoring
All equipment in the community, as well as all inventory and accounts receivable, are owned by the Business Operations Agency. The 96 village presidencies for the agency manage the inventory and take the loans needed to procure the said assets.
The Industrial Bank needs down payment before granting loans. The Capital Bank Agency gives all agencies the capital needed for various operations. Specific capital needs are detailed in business plans. The capital is not only for business plans, but also a form of net worth that the Industrial Bank requires to grant loans. The capital comes in handy when servicing loan repayment during start-up and tough economic times when business income is insufficient to cover repayments. Village presidencies serving the Business Operations Agency obtain the down payment needed to secure Industrial Bank loans from their agency.
To make the loans to villages, the Industrial Bank uses capital from the Capital Bank Agency. The bank earns interest on these loans. The capital is used to determine how much the Industrial Bank can advance as loans to villages. The Industrial Bank does not pass on capital from the Capital Bank to villages as loans. As with any other bank, the agency can create loans and deposits to balance them off in its books. However, it needs to satisfy risk assessments and avoid overstretching its capital base as advanced by the Capital Bank.
The risk assessment is gauged through a measure known as the capital adequacy ratio. The ratio compares the bank’s capital to the loans it has granted to villages. Ideally, the ratio should not be more than 10%. However, the Capital Bank, in consultations with the Industrial Bank, can increase or decrease the available capital, and therefore dictate the bank’s capacity to lend to villages.
The capital that the Industrial Bank receives from the Capital Bank is originally investment from limited partners. The capital is leveraged by the Industrial Bank, which invests the funds through its loans to itself (to build the storehouse), and the 96 villages. By using this capital to make loans to the villages and itself, the bank greatly leverages the limited partners’ investment. Considering that the bank can make as many as 10 times its capital, limited partners’ net worth is leveraged up to 10 times, and possibly more.
Providing loans to the Transport, Easements, and Mining Agency (agency 24)
Besides the equipment and factoring loans that the bank gives to the villages, it also provides financing in form of loans to the Transport, Easements, and Mining Agency. The Industrial Bank agency is tasked with easing transport within the community by developing and maintaining easements, breezeways, and other transport infrastructure. The bank also coordinates mining and other activities to obtain natural raw materials. The agency receives loans for these activities from the Industrial Bank, with a down payment from the Capital Bank Agency.
Managing the community storehouse
The Industrial Bank Builds and runs the community storehouse, which is located alongside the 24 central buildings. The storehouse is a 15-acre complex consisting of a stadium, a mall, storage space, and other facilities.
The stadium has several different sports facilities. Many of these facilities, such as swimming pools, skating rinks, hockey, and basketball courts, are also available in the district buildings. But the district buildings do not have the capacity to host competitive games and are mainly used for recreation and practice.
The stadium additionally features a pitch that can be used to host soccer, football, and baseball matches, and the capacity to hold many spectators. It is here too, that art expos and music concerts are held. The stadium includes modern features such as air conditioning and a retractable roof to protect competitors and spectators. It also has food and drinks service points where spectators can have light meals and drinks.
The mall features stores, restaurants, hotel rooms, and a conference center. The mall serves as the community’s downtown. While hubs and district buildings and their mirrored counterparts see the bulk of commercial and social activity, the mall presents the best chance for participants to interact on a much wider scale. Stores situated in the mall will mostly deal in items and services that while important, are not consumed on a frequent or large scale by participants and their businesses.
Building and managing the storehouse
The Industrial Bank builds the storehouse complex with a loan granted by itself, and a down payment from the Capital Bank. The agency runs the storehouse through contractors who manage various aspects of the facility as their stewardship. They are assisted in doing so by an automated system that helps handle bookings, repairs and maintenance, and revenue collection.
The Council of 50, which is formed by the Capital Bank presidencies of the 50 communities that make a NewVista, coordinates to ensure that there is a variety of facilities across the NewVista. For instance, rather than each community having a soccer stadium, there will be a variety of other sports uses. Some communities can be known for having good soccer stadiums, while others specialize in baseball, others football, among other sports as the council may decide.
Secondary roles of the Industrial Bank
Through the services that it provides in the community, the Industrial Bank plays an important role in attracting limited partners, and therefore, investment and businesses into the community. The agency’s role in boosting production and supporting businesses is an attractive proposition for those considering entering the community.
Innovations are an essential ingredient in the community’s quest for social-economic prosperity. The presence of structures that support innovation is the key to encouraging innovators to try out new and better ways of doing things, instead of sticking to the tried and tested road. The Industrial Bank Agency’s services to the villages enable them to support innovations.
Officing the Industrial Bank’s executive presidency
The executive presidency of the agency has its offices in district building 9’s first floor, as illustrated.
Village presidents for business operations have their offices on the 3rds or five floors of their district buildings.
There are four assembly halls in the community. Two are in district building 5, and another two are in district building 17. During the quarterly conferences, married men (A) use district building 5’s lower hall, while married women (B) use the same building’s upper hall. Single women (C) use district building 17’s lower hall, while single men (D) use that building’s upper hall.
The illustration below depicts district building 5’s lower hall (used by married men presidents during the quarterly conferences). Also highlighted are where village presidents for business operations sit.