BPF_TFSC Transformation of the Financial System
Syllabus
Spring 2015
Course objectives
The main objective of the course is to acquaint students with the concept of nancial system, the
necessity and importance of nancial transformation in the chosen emerging countries, and possibility
of transformation process of the nancial system to aect economic development. Students will be
able to examine current issues and developments inuencing the global or domestic nancial sector of
the economy from the historical perspective. Students should also be capable of discussing advantages
and disadvantages of transformation process in the chosen emerging countries and understanding the
causes and consequences of the 2007-2010 global nancial crisis. The subjects of discussion in the
course are chosen due to their demonstrative power to show successfulness of the transformation
process of the economy in both Western and Eastern civilization models (the Czech Republic and the
People's Republic of China, respectively) along with struggling, possibly worst case scenario of the
transformation (the Russian Federation).
Lectures Outline
1. Introduction to the Course. Financial System and its Transformation: Basic Denitions and
Concepts.
2. Global Financial System: Concept, Evolution and Major Institutions.
3. Financial Crises and Its Impact on the Financial System.
4. China's Economic Transition: Key Factors of Economic Development, Reformation Process,
Results of the Economic Transformation, Challenges for the Future.
5. Financial System of China: Banking System, Financial Markets, Regulation and Supervision.
6. Economic Transition of Russia: Key Factors of Economic Development, Transformation Procedures,
Results of the Economic Transformation, the 1998 Financial Crisis, Challenges for the
Future.
7. Financial System of Russia: Banking System, the 1998 Banking Crisis, Financial Markets.
8. Economic Transition of the Czech Republic.
9. Banking System of the Czech Republic.
10. Prague Stock Exchange: Prole, History, Rules, Trading Groups, and Exchange Indices.
11. Capital Market of the Czech Republic: Structure, Present State, Expected Developments, and
Specic Aspects.
12. Market Regulation and Protection in the Czech Republic (SEC).
13. Financial Management in Czech Firms: Principles and Practices.
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Literature
Essential readings will be announced at the end of each lecture (Students are expected to prepare or
lectures by reading the provided materials beforehand).
Basic denitions and concepts of the course are covered in:
Mishkin, F. S., and Eakins, S. G. (2012). Financial Markets and Institutions, 7th edition.
Outline of the lectures are available in the Study Materials.
Teaching methods
The course is taught in lectures only, which include class discussions and require active participation.
Essays improve the ability of students to summarize a certain issue in the eld of transformation of
the nancial system and discuss it critically. Readings serve to broaden and deepen the spectrum of
knowledge students acquire during the lectures.
Assessment methods
For the successful completion of the course students are required to submit an essay on the specic
topic and take a written exam (test of 20 questions or problems with multiple choices  up to 20
grade points). Exam questions are based on basic denitions and concepts discussed in the course,
the analysis of developments in nancial systems of Russia, China and the Czech Republic, as well as
essential readings. Students will not be allowed to take an exam without submitting an essay with all
the requirements fullled. Excellent essays would be awarded with additional grade points (up to 10).
Additional grade points (up to 10) might be also gained for the lecture participation, which means that
student is actively watching, listening and answering questions as the lecture progresses. Student tries
to solve the suggested example problems as the lecture 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.
Essay topics
Every topic might be chosen by three students only. Other essay topics might be added after the
consultation with teachers.
1. Financial development and economic growth  are they connected?
2. Why nancial markets are regulated?
3. Regulation vs. deregulation of nancial markets.
4. What trigger asset bubbles?
5. How speculative asset bubbles might be predicted?
6. Alternative energy sector: a new speculative bubble?
7. Costs and benets of speculation.
8. Global nancial system based on US dollar: where is the end?
9. The limits of nancial globalization.
10. Financial innovation  an opportunity for nancial development or cause of bankruptcies and
nancial crises?
11. How to compare nancial systems?
12. China  is it a world's future economic power or just one-time wonder?
13. Capital markets of the Czech Republic and modern Russia.
14. Privatization process in Russia: what went wrong?
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15. How oil and gas prices aect the stability of Russia's nancial system?
16. Most eective ways to attract FDI. The experience of China.
17. Economic transformation in the Czech Republic and China: which one was more successful?
18. Drivers of the economic growth in the Czech Republic, China and Russia: which situation is
better?
19. Banking systems of the Czech Republic and Russia: foreign-owned vs. state-owned.
20. Banking systems of China and Russia: two degrees of state domination.
21. Banking systems of China and Russia: key vulnerabilities.
22. Chinese stock market: opportunities and weaknesses for further development.
23. Czech stock market: opportunities and weaknesses for further development.
24. Is nancial system of China sound and safe?
25. Is nancial system of Russia sound and safe?
26. Is nancial system of the Czech Republic sound and safe?
Essay requirements
• An essay should express your own opinions and thoughts, based on facts or supported by experts'
opinions expressed in books, scientic articles, newspaper or magazine articles, or economic
reviews (Please use materials only relevant to the topic). Quotations are obligatory and should
be integrated into writing. At least ve sources should be used for the writing.
• An essay must be one page long and should be well-organized. Begin the essay with an
introduction stating the aims of the essay and conclude with a summary bringing together the
main issues investigated in the essay.
• Faculty's ocial formatting requirements must be fullled (Times New Roman, font size of 12
points, 1.5 spacing between the lines, heading with student's name, UƒO and topic).
• An essay should be written in English and be spell-checked, grammar-checked and personally
proofread.
• List of references is required and might be put on the second page (use generator.citace.com for
its compilation).
• Any tables and gures should be placed on the second page.
• Essay should be submitted to the Homework Vaults by April 24, 2015.
• Non-satisfactory essays will be awarded with zero grade points. Essays with a clear structure, a
good understanding of the material and originality in the approach are likely to achieve a good
mark.
Grading
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.
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Ethics Policy
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. 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 and aids 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 nish the exam by awarding grade "F" in
the Information System, and the Dean will initiate disciplinary proceedings that may result in study
termination.
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