BF401 ADVANCES IN FINANCIAL INSTITUTIONS AND MARKETS

Financial markets facilitate allocation of financial resources to productive activities for the benefit of society. Financial institutions provide the institutional framework for markets by performing essential intermediation and distribution functions. The main objectives of this course are to enable participants to capture the advances in the organisation and methods of financial markets, such as money markets and capital markets, as well as the various institutions and instruments constituting these markets, both in domestic and global contexts. The course design will include theoretical foundations, descriptive understandings and skill development, enabling participants to acquire the management capabilities required in the institutions comprising such systems

The course has been designed to provide a sound grasp of the fundamental issues and recent developments in the management of financial institutions and an understanding of the international money markets. The main focus of this course is on decision-making and problem solving techniques. There are four modules in this course as given below. The objectives of each module and the specific topics to be covered under each of them are also given.

MODULE ONE: FINANCIAL INSTITUTIONS AND INTERMEDIATION

[Week 1 - Weighting 10%]

This module analyses the role of financial institutions in society, describes the process of financial intermediation, differentiates direct and indirect financing, outlines recent changes in the financial services competition and describes financial markets.

Component 1.1. Financial Institutions and Intermediation

Component 1.2. Financial Markets

This module will provide a foundation for the rest of the modules.

MODULE TWO: FINANCIAL INSTITUTIONS

[Weeks 2 to 8 - Weighting 40%]

The main objectives of this module are to enable the students to understand the main issues in the area of the management of financial institutions, be familiar with fundamental financial models relevant to the management of liabilities, credit, liquidity, and profitability in financial institutions, and be able to use the various financial analysis techniques in understanding the typical management problems in financial institutions, take decisions and monitor their implementation in the best interest of the firm.

Component 2.1 Managing Liabilities in Financial Institutions

Component 2.2 Managing Assets in Financial Institutions

Component 2.3 Managing Liquidity in Financial Institutions

Component 2.4 Managing Profitability in Financial Institutions

Component 2.5 Risk Management

Component 2.6 Strategic Planning in Financial Institutions

Component 2.7 Regulation of Financial Institutions

MODULE THREE: FINANCIAL MARKETS

[Weeks 9 to 12 - Weighting 40%]

This module defines money markets, capital markets and foreign currency markets, explains the roles of money market participants, describes financial instruments traded in money markets and analyses their pricing, the concept of capital asset portfolio, examines recent trends in domestic and global money markets, and illustrates methods of protecting against foreign exchange risk.

Component 3.1 Money Markets

Component 3.2 Capital Market Instruments

Component 3.3 Capital Markets, Derivative Securities, and International Diversification

Component 3.4 Foreign Currency Exchange Markets

MODULE FOUR: INTERNATIONAL FINANCIAL MARKETS

[Weeks 13 and 14 - Weighting 10%]

This module discusses the development of Off-Shore markets, defines the instruments of Off-Shore markets, including deposits, bonds, commercial paper and notes, and equities, traces the growth of Off-Shore market instruments during the 1980s, and provides background material on the European Community and outlines the objectives and goals of the Single European Market.

Component 4.1 Off-Shore Currency Markets

Component 4.2 International Bonds Market

Component 4.3 International Commercial Paper and Off-Shore Notes

Component 4.4 International Equities Market

Course participants must obtain at least 50% overall and a minimum of 40% in the final examination to secure a pass in this course.

There will be two basic texts - For Modules 1, 3 and 4 - Financial Institutions and Markets: A Global Perspective by H J Johnson, McGraw-Hill, Inc., 1993; and For Module 2 - Bank Management (2nd Ed.) 1992 by Timothy W Koch, The Dryden Press, Orlando, Florida 32887, USA. Other references are mentioned in the detailed course outline

 

BF402 SPECIAL TOPIC IN BANKING & FINANCE

Prerequisites Approval of the Professor of Banking

The topic of this course will be decided in consultation with the Department and will normally be designed to fit the student's research interests. Literature 10%, Research Paper 35%, Short Reports 15%, Final Examination 40%, Total 100%.