Course ObjectiveThis course aims to deepen your knowledge on the business model of banks
and the role they have in the wider economy. After completion of the
course, you should:
- Have a thorough understanding of how banks make their money and the
risks involved (Bridging Theory and Practice).
- Understand the concept of Asset & Liability Management, including
capital (Academic and Research Skills).
- Be able to explain the role of the different regulators and outline
the most important new regulations that apply to banks and how these
will impact their business model (Broadening Your Horizon).
- Be able to assess a credit request and be able to apply a credit risk
analysis for a corporate, form an opinion and decide on the request
(Bridging Theory and Practice).
- Acquire an academic and critical attitude towards the financial system
in general and the role of banks in particular (Broadening Your
- Understand the basics of Financial Stability and monetary policy and
the impact on banks (Academic and Research Skills).
- Understand and explain the concept of money creation (Bridging Theory
Course ContentThis course is a multidisciplinary course and deals with two important
aspects of bank management: the bank business model and business process
management within a bank. The fist topic is about financial economics,
however we will also zoom into the broader function of banks in the
macro economy. The second is about business process management. In more
detail there are 4 building blocks: The first building block is about
the position of banks in the wider economy. Both the academic frameworks
re macro and financial economy will be studied. The second building
block is about bank management and consist of balance sheet risk
management and credit risk. Re the latter, the loan portfolio is on
average 50-75% of the portfolio and determines for a large part the
business model of a bank. Focus will not only be on individual credits,
also techniques to manage the loan portfolio will be studied. Balance
sheet risk management consist out of capital, interest rate risk and
liquidity. Managing financial risk at both the asset and liability side
is key for banks. The recent banking crisis shows the impact of
overlooking and underestimation financial risks. Improving a banking
business model can be seen as an optimisation of a banking portfolio -
having various product-market combinations - in terms of (financial)
risk and return. The third building block focus on the regulatory
environment. The Basel Framework has and has to be aligned with the
Basel Framework, including Basel III and an outlook to Basel IV. Finally
there will be attention for ‘banking’ alternatives. What is the future
business model of banks, is it still viable in the coming decade?
Teaching MethodsLectures and tutorials
Method of AssessmentCase (individual assessment) ; Case (group assignment) ; Exam
LiteratureBank Management & Financial Services (2012), By Peter S. Rose & Sylvia
C. Hudgins ; ISBN: 978-007-132642-1
|Language of Tuition||English|
|Faculty||School of Business and Economics|
|Course Coordinator||drs. T.A.J. de Jong|
|Examiner||drs. T.A.J. de Jong|
You need to register for this course yourself
Last-minute registration is available for this course.
|Teaching Methods||Seminar, Lecture|
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