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Unit information: Banking in 2020/21

Unit name Banking
Unit code EFIMM0006
Credit points 15
Level of study M/7
Teaching block(s) Teaching Block 2 (weeks 13 - 24)
Unit director Dr. Fabiana Gomez
Open unit status Not open
Pre-requisites

None

Co-requisites

If taking this unit, can not take:

EFIMM0054 - Principles of Financial Intermediation OR

EFIMM0053 - Banking Regulation and Financial Stability OR

EFIMM0052 - Banking Management and Risk Management

School/department School of Accounting and Finance
Faculty Faculty of Social Sciences and Law

Description

The objective of the course is to understand the role of banks in the economy and the sources of fragility of the banking sector. It begins by introducing the main functions of banks in the economy. This is followed by the study of the economic literature about the existence of financial intermediaries. Then, the causes of financial crises are analyzed: financial panics, bubbles, contagion and endogenous risk. Next, the course focuses on the Subprime crisis to analyze its causes and consequences. The course ends with an analysis of banking regulation.

Intended learning outcomes

  1. To understand the fundamentals of financial intermediaries
  2. To identify the main source of risks of individual banks from their balance-sheets.
  3. To compare and critically analyse the performance of different banks
  4. To recognize the main sources of fragility of the banking sector
  5. To understand economic problems behind bank runs, bubbles, financial contagion and endogenous risk
  6. To identify the market failures leading to the Subprime Crisis
  7. To understand current bank regulation and the rationale behind it

Teaching details

Teaching will be delivered through a combination of synchronous and asynchronous sessions including lectures, tutorials, drop-in sessions, discussion boards and other online learning opportunities

Assessment Details

This unit will be assessed by group coursework 20% and exam 80%

Reading and References

Freixas and Rochet, Microeconomics of Banking, 2nd edition, 2008 MIT Press

Saunders and Cornett, Financial Markets and Institutions, 6th edition, 2015, McGraw Hill

Resti and Sironi, Risk Management and Shareholders Value in Banking, 2007, Wiley

Introduction to Banking by Casu, Girardone and Molyneux, 2nd edition, Pearson 2015

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