Initially, no one has any money and only he can create it. Doing so would add new money to Planet Doom's economy without creating additional debt for the rest of the inhabitants to repay. This is the primary flaw in Jaikaran's story. The banker is not an ethereal entity. No, he is a living, breathing person who needs to purchase the products and services which make life possible and enjoyable.
Banks are no different in the real world.
Commercial banks and savings and loans have expenses to pay just like any other firm. They must pay their employees, purchase office supplies, and meet the other expenditures which are a part of doing business. The revenues banks collect from interest on loans and other services do not disappear into an economic void. Instead, those revenues are used to meet the bank's operating expenses, to purchase assets to generate future income, or are paid to the shareholders as dividends. Those are the only three places any firm's revenues can go.