AØKA08069U Economics of Banking (F)

Volume 2018/2019
Education

MSc programme in Economics – elective course
The course is part of the Financial line at the MSc programme in Economics,   symbolized by ‘F’.

 

The PhD Programme in Economics at the Department of Economics - elective course with resarch module (PhD students must contact the study administration and the lecturer in order to write the research assignment)

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.

 

Course Outline:

  • Introduction: Key competences of banks
  • Types of financial intermediation; basics of risk management
  • The loan contract; interest rate risk
  • Rationing in the credit market; market risk
  • Securitization and shadow banking
  • Credit risk
  • Payments and its impact on banking
  • Competition and risk taking
  • Irregularities in banking
  • Liquidity crises and bank runs; operational risk
  • Deposit insurance
  • Lenders of last resort
  • Reorganizing and closing banks
  • The Basel regulations
Learning Outcome

After completing the course, the student should be able to:

Knowledge:

  • Identify and assess the roles of banks in the financial sector, related to the basic problems of asymmetric information in its different forms,

  • know the basic principles of risk management and of risk measures, as well as the basic organisation of risk management in a bank,

  • Understand the causes of bank runs and bank panics, knowledge of different institutional setups designed for coping with bank runs,

Skill:

  • Select relevant theories and analyze problems related to financial intermediation,

  • Evaluate alternative methods for managing risk in banks,

  • Give suggestions for suitable regulation in the financial sector,

Competences:

  • Assess properties of credit markets, designing improvements of the contract structure,

  • Give advice for the regulation of financial intermediation and for the prevention of financial crises.

 

We use the textbook

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

None
Lectures
Schedule:
2 hours lectures 1 to 2 times a week from week 6 to 20 (except holidays).

Timetable and venue:
To see the time and location of lectures please press the link/links under "Se skema" (See schedule) at the right side of this page (F means Spring).

You can find the similar information in English at
https:/​/​skema.ku.dk/​ku1819/​uk/​module.htm
-Select Department: “2200-Økonomisk Institut” (and wait for respond)
-Select Module:: “2200-F19; [Name of course]”
-Select Report Type: “List – Weekdays”
-Select Period: “Forår/Spring – Week 5-30”
Press: “ View Timetable”

The overall schema for the Master can be seen at KUnet:
MSc in Economics => "courses and teaching" => "Planning and overview" => "Your timetable"
KA i Økonomi => "Kurser og undervisning" => "Planlægning og overblik" => "Dit skema"
  • Category
  • Hours
  • Exam
  • 3
  • Lectures
  • 42
  • Preparation
  • 161
  • Total
  • 206
Credit
7,5 ECTS
Type of assessment
Written examination, 3 hours under invigilation
The exam assignment is given in English and must be answered in English.
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Exam registration requirements

none

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Aid
Without aids
Marking scale
7-point grading scale
Censorship form
No external censorship
The exam can be selected for external assessment.
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Exam period

Exam information:

The exam takes place at the computers of the university:

24 May 2019

 

From the middle of the semester the exact time will be available in Digital Exam portal.

 

Note: In special cases, the exam date can be changed to another day and time within the exam period.

 

More information about examination, rules, exam schedule: Master students (UK)  and Master students (DK).

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Re-exam

Reexam information:

The reexam takes place at the computers of the university:

23 August 2019

 

During the reexam period the exact time can be seen in Digital Exam.

 

Note: In special cases, the written reexam can change to another day within the reexam period. Or to an oral exam incl. date, time and place, if only a few students have registered the reexam. This will be informed by the Exam Office.

 

More info:  Master students (UK)  and  Master students (DK).

Criteria for exam assesment

Students are assessed on the extent to which they master the learning outcome for the course.

To receive the top grade, the student must with no or only a few minor weaknesses be able to demonstrate an excellent performance displaying a high level of command of all aspects of the relevant material and can make use of the knowledge, skills and competencies listed in the learning outcomes.