(Revised November 2002)
Code: UPEN48-15-M Title:
Principles and practice of banking Version: 1
Level: M UWE
credit rating: 15 ECTS credit rating: 7.5
Module type: Standard
Owning Faculty: HLSS Field: Economics
Valid from: September 2004 Discontinued from:
Pre-requisites: None
Co-requisites: None
Excluded combinations: None
Learning outcomes:
Having successfully completed the module, students
should be able to:
·
Show a critical awareness of the latest literature and current
developments in the economic analysis of banking (components A & B).
·
Show a critical awareness of the principles of financial intermediation
and the risks to which they give rise (component A)
·
understand the most-recently developed risk assessment techniques
employed by banks and the strategies to which they give rise (components A &
B)
·
compare and contrast competing models of
the banking firm (component A)
·
understand the current debates about the appropriate regulatory
framework and the principles and issues which underlie regulation (component B)
·
understand the role of banks in the money supply/transmission
mechanism (component B)
·
deal with complex issues and show evidence of self-direction and originality
in tackling the problems thrown up by the process of change and innovation in
banking (components A & B).
Syllabus outline:
·
Defining a bank. Banking in US, UK and EU.
·
Principles of intermediation.
·
Risks in banking. Risk measurement and control techniques.
·
Models of the banking firm. The Stiglitz view.
·
Regulation of banking activity I – the central bank and domestic
regulation.
·
International regulation – Basle I and Basle II.
·
Regulation and the growth of off-balance sheet activity.
·
Banks, money and interest rates.
Teaching and learning
methods:
Several different teaching and learning methods will be used.
Lectures will be used to communicate core material
and to deal with central concepts and models. Some lectures may be interactive,
giving a chance for questioning and debate on economic and financial issues
raised in this module. Use may also be made of video recordings, with student
tasks being linked where relevant to material in the videos. Seminars will involve a number of
different formats as group reporting on case study material, formal debates,
discussion of assigned reading and presentations.
Indicative sources:
E Baltensberger, 1980, ‘Alternative
Approaches to the Theory of the Banking Firm’, Journal of Monetary
Economics , 6.
Bank for International Settlements, 1990, The Lamfalussy
Report, Basle.
D Chew (ed), 1991, New Developments in Commercial Banking, Blackwell.
J Dermine, 1995, European Banking in the 1990s, Blackwell.
J Dermine and Y F Bissada, 2002, Asset and Liability Management: A Bankers’
Guide to Value Creation and Risk Control, FT-Prentice Hall.
C A E Goodhart, 1995, The Central Bank and the Financial System, Macmillan.
S I Greenbaum
and A V Thakor, 1995, Contemporary Financial Intermediation, Dryden.
S Heffernan, 1996, The Theory and Practice of Banking, Wiley.
A Mullineux, 1995, Financial Innovation, Banking and Monetary
Aggregates.
J Stiglitz and B
Greenwald, 2001, Towards a New Paradigm
in Monetary Economics Cambridge UP.
Students will be expected to draw on current
journal articles from:
Applied Economics
Applied Financial Economics
The Banker
Bank of England Quarterly
Bulletin
Economic Journal
ECB Monthly Report
European Economic Review
Journal of Post Keynesian
Economics
Scottish Journal of
Political Economy
And from the websites of the Bank of England, the
ECB, the BIS and the US Federal Reserve
Assessment
Weighting between
components A and B (standard modules only)
A:
50% B: 50%
ATTEMPT 1
First Assessment
Opportunity
Component A
Description of each element Element
weighting
1. Unseen
exam, 2hours 50%
Component B
Description of each element Element
weighting
1. Individual
coursework assignment of up to 1500 words 50%
Second Assessment
Opportunity (further attendance at taught classes is not required)
Component A
Description of each element Element
weighting
1. Unseen
exam, 2 hours 50%
Component B
Description of each element Element
weighting
1. Individual
coursework assignment of up to 1500 words 50%
SECOND (OR SUBSEQUENT)
ATTEMPT: Attendance at taught classes is not required.
Specification confirmed
by ……………Module approved at VARSC
13.05.04.
Date ……………………………
(Associate Dean/Programme
Director)