The Stanford Bank Game (formerly known as the Stanford Bank Management Simulator or SBMS) is a personal computer program that simulates the operations of a commercial bank, based on the decisions of management teams. The simulation is designed for use as a training device to give current and future managers of financial institutions a working knowledge of the financial interrelationships within a commercial bank. Participants make short-term operating decisions and, at the same time, consider the implications of these decisions for long-run growth and profitability. While the relationships in this program are idealized and do not necessarily reflect the particular operations of any actual bank or class of banks, participants work with a fairly complex and realistic model and are challenged to make optimal decisions within this framework.
The basic operational unit of the game is the individual bank. The basic time unit is the calendar quarter (no seasonal patterns exist). In each quarter of the game, the simulator computes the earnings and operating results for each bank by processing the decisions of the participating banks, the financial positions of the banks at the start of the quarter, and the economic data specifying the operating environment.
At the end of each quarter, the program generates several computer printouts: The Instructor's Report, which summarizes the performance of each bank, and individual printouts for each bank, which give that particular bank's financial position and the composition of its loan and investment portfolios as well as comparative information on all banks. The ending financial position of each bank in one quarter becomes that bank's starting financial position in the following period. Participants need to manage all of the different areas of the bank, such as securities, liabilities, loans, services, capital, and they need to integrate all of these to maximize overall profitability.
Bank simulation are powerful educational tools that have been used very successfully in banking schools, banks, and graduate programs in banking for more than three decades. The computer report of the starting position of the bank is a complex case study of a commercial bank. The first set of management decisions is the participants' solution to the case study. In turn, the next computer report, in the form of a bank financial statement, is both an evaluation of the participants' decisions and a whole new case study. The new problems are products of the previous decisions and participants are challenged to find ways to improve their performance. Participants need to manage all of the different areas of the bank, such as securities, liabilities, loans, services, capital, and they need to integrate all of these to maximize overall profitability.
The Stanford Bank Game is a self-contained package which consists of the following three items:
1. Student Materials: The manual outlines the information a participant needs to understand the operating environment of the simulation, to make the input decisions, and to interpret the computer printout. Ratios or terms used in the simulation are defined in the manual. The Exec. version of the student manual takes an instructional approach and is about 15 hours of study time. There is also an optional case study package. Earlier versions of SBG had a basic manual that is no longer supported.
2. Instructor's/Operator's Manual: This manual contains information about the Instructor's Report and the computer operations of the simulation.
3. Program : There is one program file which installs the computer simulation. It runs on any Windows OS. Running The Program describes how to use the simulation.