LLBT and New Interest Rates

A few questions was asked about the change in interest rates so I thought I would post my reply to it here.

http://www.slcapex.com/forums/topic/LNL/1091

"The rates are correct and the website is being updated. At this point, the rates our competitors offer do not concern me much because most rates are not long term sustainable. True enough we are supposed to remain competitive but our goul is also to be able to service our customers and safeguard their deposits.

After weeks of plugging over manuals and books of RL banks as well as reading the histories of the recent fallen banks in SL, one thing remained true. The interest rates were inflated just to get a customer base but not thought was put into the long term sustainability of that rate. Therefore, we have taken a step back and basically said to hell with trying to keep up with the Joneses with the onslaught of failure almost imminent.

Currently, most banks offer 37-60% per annum yield compounding. Potentially, a bank with 40 million in holdings would pay out about $65K in interest daily. Some people have been in SL for years and not seen that kinda of money at one time but the bank is expected to pay that daily. It will work for a while but as the bank gets bigger, the reserves get smaller.

Also, RL investing was supposed to be a bit of a cure all but with the value of the linden dropping, this is not feasible either. It is my goal to reinvent the SL bank with L&L Bank and Trust and not continue down a road that will only end in failure. May not be now, may not be next year, but eventually, it will get hairy.

The rates proposed are still better than RL rates as the savings account is about 25-45% higher than most rates you can get at a RL bank so as long as an investor can maintain that same conversion, they would make more money.

How do I plan to keep depositors? I plan to keep them by being sound in my judgement of the banks offers and do what I can to safeguard their investment rather than trying to offer the best rate. One thing I have always said is that I may not be the best solution for everyone but I am the best solution for someone. And that someone is my focus.

The website is undergoing massive verbiage changes to fall in line with the new line of thinking. L&L Bank and Trust is a business and I will run it as such but being in business doesn't mean I need to be foolish about it. My stance is sustainability. And I do not see a viable way to sustain on those rates without loan sharking and gambling.

I am sorry if depositors leave because of it but as of yet, I have not seen an unmanageable run. I think the time of the unrealistic expectations is gone along with a lot of lindens and a lot of trust in the market. Competition is off my radar right now. I have a business to run."

I just felt the need to make this known.