Strange Yardstick for Sanctioning Funds

A small business client approaches a local bank for working capital for his project. He submits a proposal and hopes the loan will be sanctioned soon. He gets a call from the bank asking him to come for a discussion. Accordingly he goes to the bank. Now the conversation follows:

Banker: Mr. Borrower. You have assumed a production level of 10 tons per day on single shift basis. You have asked for $ 1 million as working capital. Now we find you propose to attain only 5 tons per day output in the first year. So we cut down the working capital limit to $0.5 million.

Client: How is it possible Sir? There cannot be any proportionate reduction. I have to stock minimum quantities of raw materials and cartons. I have to pay salary for one month. Trade practices demand one month credit to customers. I have estimated the fund requirements at the minimum level. Considering marketing considerations and constraints I can reach the maximum out put over a year.

Banker: I am not convinced about your arguments. I stick to my decision to grant you $ 0.5 million.

Client: Then you are acting according to the principle: "For drawing one bucketful of water from a well we need ten meters of rope." So for drawing half a bucket of water only 5 meters are enough."
I salute your intelligence. You are not a banker. You are one with a bankrupt brain. I will try others more sensible. Thank you.
The client leaves the bank.