ES52058: Economics of banking and financial institutions
[Page last updated: 14 August 2024]
| Academic Year: | 2024/25 |
| Owning Department/School: | Department of Economics |
| Credits: | 5 [equivalent to 10 CATS credits] |
| Notional Study Hours: | 100 |
| Level: | Masters UG & PG (FHEQ level 7) |
| Period: |
|
| Assessment Summary: | CWOG 30%, EXCB 70% |
| Assessment Detail: |
|
| Supplementary Assessment: |
|
| Requisites: | In order to take this module you need to have an undergraduate level of Mathematics and Economics |
| Learning Outcomes: |
Identify key functions of banks and other financial institutions and contrast their role and mission to that of capital markets.
Develop a solid understanding of the fundamental theories that relate key functions of intermediaries to bank fragility and financial stability.
Critically assess and advise policy on regulatory measures and proposals.
Master a set of analytical tools and formally analyse problems related to asymmetric information, financial contracts, competition, etc.
Develop and demonstrate an in-depth understanding of the 2007-2008 global financial crisis through the application of the theories discussed in the lectures and seminars.
|
| Synopsis: | Learn about the economics of financial intermediation, with a focus on banking.
You'll explore market frictions and the fundamental roles of financial institutions and markets that address them. Throughout the unit, you'll give special attention to:
- banks and their special features (such as financial stability, risk shifting and competition, regulation)
- financing techniques (including securitisation)
You'll also study the changing roles of these topics in financial intermediation. |
| Content: | The course starts by introducing market frictions prevalent in the financial system (e.g. asymmetric information) and discusses how intermediation can address them.
Students will develop a solid understanding of the fundamental roles of, and also the relationship between, financial markets and institutions, and learn about to what extent markets and institutions are complements and/or substitutes in intermediation.
A large part of the course is dedicated to banking and its special features. We will talk about inter alia the transformation of the banking business as well as industry, the relationship between bank competition and risk shifting, financial stability, bank regulation, and will also discuss in detail important developments in bank financing techniques, such as securitisation.
The unit builds on the analysis of strategic firm behaviour with the aim to understand the structure and basic operation of financial intermediation in general and banking in particular.
The analytical framework is introduced and critically discussed in lectures. Then students are required to apply these formal concepts to a range of problems in seminars. Furthermore, the course also gives students the opportunity to conduct independent research.
The knowledge gained in this course is directly applicable in central banks, financial regulation and international organizations such as IMF, World Bank, but it is also vital for business analysts in the financial industry. |
| Course availability: |
ES52058 is Compulsory on the following courses:Department of Economics
ES52058 is Optional on the following courses:Department of Economics
|
Notes:
|