This module covers the current and developing financial sector environment; main financial management functions of the financial firm; financial analysis; asset and liability management; risk management; capital adequacy, capital allocation and VAR (value at risk) modelling; the lending function; securitisation techniques; and financial crisis and regulation.

8 x 2 hour lectures

4 x 1 hour tutorials

None

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1. Portfolio; Individual; 1,000 words; 40%; ILOs 3-5.

2. Degree exam: on-campus; Individual; 90 minutes; 60%; ILOs 1-5.

The aims of this course are:

■ To develop understanding of empirical banking literature, focusing on financial regulation and financial stability, and the sources and impacts of financial system instability.

■ To enable critical evaluation of central banking, regulation, and supervision in shaping financial stability and influencing bank behaviour and economic outcomes.

By the end of this course, students should be able to:

1. Demonstrate knowledge of key themes in the empirical banking literature, with a particular focus on financial regulation and financial stability.

2. Evaluate the importance of financial stability from both microeconomic (institution-level) and macroeconomic (system-wide) perspectives.

3. Identify, analyse, and interpret the main sources of instability within the financial system, and assess their transmission and impact on financial institutions and the broader economy.

4. Discuss and critically evaluate the role of central banks in maintaining financial stability, including the use of policy tools and frameworks.

5. Critically assess how financial regulation and supervision influence commercial banks' behaviour and evaluate the implications for economic outcomes in the real economy.