Bank Management

2024/2025

Academic Year

ENG

Instruction in English

3

ECTS credits

Delivered at:

Department of Finance

Course type:

Elective course

When:

1 year, 4 module

Course Syllabus

Abstract

This is an intermediate banking course for the BAc Finance and Economics programme students. The course is also included in the University of London International Programme. The course is taught in English and is mandatory. The course aims to provide insights into financial economics, economics of banking, its role in the economy, and practical risk management issues. This course introduces the main models and surveys the basic literature on financial economics and financial intermediation. Utilising the tools of general microeconomic theory for problems of financial theory demonstrates the convergence of the two disciplines. The course underlines the distinctions between models based on symmetric information and competitive market and models that use the assumption of asymmetric information and contractual relationships. Under symmetric information assumption there is no need for financial intermediation and banks are unable to earn non-zero profit. Prices are determined by the competitive market and each agent decide on assets allocation to maximize expected utility. In this framework the models of asset pricing are considered. If information is asymmetric the market allocation is no longer optimal. Financial intermediaries that enable loan and deposit contracts can provide better opportunities in that case. The role of banks in the economy is described and emphasised with the services provided by banks to investors and firms, namely liquidity insurance and delegated monitoring. The unit structure includes themes about most important issues on bank management, bank regulation, and development of financial markets.