AØKA08069U Economics of Banking (F)

Volume 2015/2016
Education

Elective at MSc in Economics
The course is part of the Financial line symbolized by "F".

Content

The course covers two aspects of the topic, microeconomics of banking and risk management. In the microeconomics part, teaching starts with discussing key competences of banks, proceeds to fundamental aspects of banking such as the loan contract and credit rationing, discusses liquidity problems and bank runs, and ends up with a treatment of bank regulation involving the roles of central banks, deposit insurance and financial supervision authorities. In the risk management part, the course covers the basics of risk management in banks, measurement of risk, and then discusses the different types of risk occurring in banking, namely liquidity risk, interest rate risk, market risk, credit risk, and operational risk. For each of the risk types, the course covers the measurement of risk as well as methods for reducing risk.

Learning Outcome

The course aims at giving the students the abilities and competences needed to understand and to deal with main problems in the banking sector, both with respect to the functioning of the sector as a whole and the single bank. More specifically, the students are expected after the course to have the following competences:

  1. Knowing and assessing the roles of banks in the financial sector, related to the basic problems of asymmetric information in its different forms,
  2. Knowledge of contract forms and the conditions for choosing a given contract depending on the underlying economic conditions,
  3. Understanding the background of problems related to difficulties in obtaining credits and how they can be remedied,
  4. Knowing about the interrelation between competition in the banking sector and interest rate levels,
  5. Understanding the causes of bank runs and bank panics, knowledge of different institutional setups designed for coping with bank runs,
  6. Knowledge of basic principles for deposit rate insurance, understanding of the intrinsic problems related to assisting troubled banks, as well as the distribution of competence among different authorities
  7. Knowledge of basic principles of risk management and of risk measures, as well as the basic organisation of risk management in a bank,
  8. Knowledge of different types of risk and the way in which these risks are measured and mitigated.

We use the textbook

H.Keiding, Economics of Banking, Palgrave-Macmillan 2015.

None
2 hours of lectures one to two times per week for 14 weeks

Time and room:
For time and classroom please press the link under "Se skema"(See schedule) at the right side of this page (15E means Autumn 2015, 16F means Spring 2016).
Normally the exercise classes begin in the second week of the semester.

You can find the similar information partly in English at
https:/​/​skema.ku.dk/​ku1516/​uk/​module.htm
-Select Department: “2200-Økonomisk Institut” (and wait for respond)
-Select Module:: “2200-F16;Economics of Banking”
-Select Period: “Forår/Spring – Weeks 4-29”
-Press: “ View Timetable”
  • Category
  • Hours
  • Exam
  • 3
  • Lectures
  • 42
  • Preparation
  • 161
  • Total
  • 206
Credit
7,5 ECTS
Type of assessment
Written examination, 3 hours under invigilation
A 3 hours written examination without any aids.
Aid
Without aids
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censorship
Exam period

The written exam takes place June 16, 2016 at Peter Bangsvej 36, 2000 Frederiksberg http://pc-eksamen.ku.dk/pc_exam

The exact time of the exam will be informed in the Self-Service at KUnet mid-April.

For enrolled students more information about examination, exam/re-sit, rules etc. is available at the student intranet for Examination (English) and student intranet for Examination (KA-Danish).

 

Re-exam

The written re-exam takes place August 12, 2016 at Peter Bangsvej 36, 2000 Frederiksberg http://pc-eksamen.ku.dk/pc_exam

If only a few students have registered for the re-exam, the exam might change to an oral exam including the date for the exam, which will be informed  by the Examination Office.

Criteria for exam assesment

The student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.