BPF_BANK Banking

Faculty of Economics and Administration
Autumn 2024
Extent and Intensity
2/2/0. 6 credit(s). Type of Completion: zk (examination).
In-person direct teaching
Teacher(s)
Oleg Deev, Ph.D. (lecturer)
Ing. Martina Sponerová, Ph.D. (lecturer)
Oleg Deev, Ph.D. (seminar tutor)
Ing. Martina Sponerová, Ph.D. (seminar tutor)
Guaranteed by
Oleg Deev, Ph.D.
Department of Finance – Faculty of Economics and Administration
Contact Person: Mgr. Jana Nesvadbová
Supplier department: Department of Finance – Faculty of Economics and Administration
Timetable
Thu 12:00–13:50 S305, except Thu 19. 9., except Thu 7. 11.
  • Timetable of Seminar Groups:
BPF_BANK/01: Thu 14:00–15:50 S305, except Thu 19. 9., except Thu 7. 11., O. Deev, M. Sponerová
Prerequisites
Students taking the course should have prior knowledge from undergraduate level of mathematics, microeconomics, macroeconomics and financial theory (MU courses Mathematics, Microeconomics I, Macroeconomics I and Basic Finance).
Course Enrolment Limitations
The course is only offered to the students of the study fields the course is directly associated with.

The capacity limit for the course is 24 student(s).
Current registration and enrolment status: enrolled: 26/24, only registered: 0/24
fields of study / plans the course is directly associated with
Course objectives
The main objective of the course is to acquaint students with an understanding of the basic concepts of banking, bank management and bank regulation. The course is aimed at understanding the behavior of banks, their specific characteristics and operations, and the special intermediation role they play in the financial system and the economy as a whole. The course is also addressing some of the major trends in domestic and international banking in recent times using the basic tools of economic analysis.
Particular attention is given to the theories of financial intermediation and market frictions (informational asymmetries) as well as to issues concerned with bank performance and risk-taking. Emphasis is further placed on the management of the bank and, in particular, management of the balance sheet, risk management, and loan pricing.
Class time will be divided between lectures, seminars, class presentations and a class project. Two-hour lectures will be used to highlight the key points of the material. Seminars are designed to further the understanding of bank financial statements and bank performance. Class participation in the form of problem solving or responding to questions will be an important part of the learning experience.
Learning outcomes
Students will get an understanding of major issues in banking. Students will be able to:
- discuss and evaluate the theories relating to the role of banks as financial intermediaries;
- understand the role of transactions costs and informational asymmetries in the operation of the banking system and how they can lead to banking crises;
- describe and analyze the various bank performance measures;
- discuss the main types of risk that banks face and explain their relevance to the stability of the financial system;
- comprehend practices of bank management, in particular credit evaluation, bank funding and capital management, asset/liability management and investment management.
Syllabus
  • Banks and financial intermediation. Functions of banks. Microeconomic theory perspective on banking. Transaction costs. Information asymmetry.
  • Types of bank operations. Retail and wholesale banking. Universal banking. Bank business models.
  • The theory of the banking firm. Models of banking behavior.
  • Bank lending activities. Types of loans. Credit process. Loan pricing.
  • Credit Evaluation. Financial and non-financial analysis of loan applicants. Credit risk ratings.
  • Loan securitization.
  • Bank funding management. Funding sources and banking risks.
  • Bank capital management. Capital adequacy. Optimal capital structure.
  • Bank asset/liability management. Static and duration gap analysis. Interest rate and earning sensitivity analysis.
  • Bank investment management. Composition of the bank investment portfolio. Bank foreign exchange activities.
  • Evaluating bank performance. Profitability analysis. Risk-adjusted performance analysis.
  • Banking crisis. Systemic risk in banking. FinTech and other timely topics in banking.
Literature
    required literature
  • CHOUDHRY, Moorad, Polina BARDAEVA, Natasha BOURNE, Michael EICHHORN, Beata LUBINSKA, Engelbert PLASSMANN, Periklis THIVAIOS and Chris WESTCOTT. The principles of banking. Second edition. Hoboken: Wiley, 2023, li, 811. ISBN 9781119755647. info
  • KOCH, Timothy W. and Steven Scott MACDONALD. Bank management. 8e. Boston: Cengage Learning, 2015, xx, 778. ISBN 9781133494683. info
    recommended literature
  • MATTHEWS, Kent and John L. THOMPSON. The economics of banking. Third edition. Chichester: Wiley, 2014, xv, 336. ISBN 9781118639207. info
  • MISHKIN, Frederic S. The economics of money, banking and financial markets. Thirteenth edition, Global e. Harlow: Pearson, 2022, 718 stran. ISBN 9781292409481. info
Teaching methods
The course is taught in lectures and seminars, which include class discussions and require active participation. The attendance is compulsory. Students are expected to prepare themselves for lectures and seminars by reading the provided materials beforehand. Tutorial group meetings will be organized and held once a week. Class presentations improve the ability of students to summarize a certain issue in the field of banking and discuss it critically. Additional readings serve to broaden and deepen the spectrum of knowledge students acquire during the lectures.
The exact requirements for completing the course also apply to students studying abroad (e.g. Erasmus) with an individual study plan, except for the compulsory attendance (alternative assignment is provided instead). More information on the alternative assignment is given in the interactive syllabus of the course. Students are required to contact the guarantor in the first teaching week of the semester and arrange the deadlines for fulfilling the assignment.
Note: “Any copying, recording or leaking tests, use of unauthorized tools, aids and communication devices, or other disruptions of objectivity of exams (credit tests) will be considered non-compliance with the conditions for course completion as well as a severe violation of the study rules. Consequently, the teacher will finish the exam (credit test) by awarding a grade "F" in the Information System, and the Dean will initiate disciplinary proceedings that may result in study termination."
Assessment methods
For the successful completion of the course students are required: to take a written exam, make one class presentation on the given topic and submit one individual project (by the end of week 11).
Following is the scale that will be used to evaluate your performance in this class:
- one group project (up to 10 grade points),
- active participation in the class (up to 8 grade points),
- final exam (up to 20 grade points).
The exam will be cumulative on the material from the entire course. Students will not be allowed to take an exam without submitting the report and given the presentation with all the requirements fulfilled. Active participation in class means that student is actively watching, listening and answering questions as the lecture or seminar progresses. Student also tries to solve the suggested example problems as the lecture/seminar proceeds and proves that he/she has learned the material by answering the related questions and working the related problems incorporated in the summative assessment. Participation quality (thoughtfulness of comments or questions) is valued more than participation quantity (frequency of comments/ questions).
Language of instruction
English
Further comments (probably available only in Czech)
Study Materials
The course is taught annually.
Teacher's information
Final grades would be given according to the following grading scale:

A = 28-30+;

B = 26-27;

C = 23-25;

D = 21-22;

E = 18-20;

F = below 18.

Plus/minus grading at student’s request will not be used in this course.

Students in this course are expected to adhere to the Masaryk University’s high standards of integrity as spelled out in the Disciplinary Code for Students and Directive N.3/2008. Anyone who cheats on exams, or who submits essay that is not their own, will be subject to the penalties set forth in the Code.

Any copying, recording or leaking tests, use of unauthorized tools, aids and communication devices, or other disruptions of objectivity of exams will be considered non-compliance with the conditions for course completion as well as a severe violation of the study rules. Consequently, the teacher will finish the exam by awarding grade "F" in the Information System, and the Dean will initiate disciplinary proceedings that may result in study termination.

The course is also listed under the following terms Autumn 2022, Autumn 2023.
  • Enrolment Statistics (recent)
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