20502 International Banking Management
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Subject handbook information prior to 2025 is available in the Archives.
Credit points: 6 cp
Subject level:
Undergraduate
Result type: Grade and marksThere are course requisites for this subject. See access conditions.
Description
This subject teaches the fundamentals of managing a financial institution in an international context. The principles are applied in the context of banks, but have a wider relevance to the management of non-bank financial institutions. The structure of the financial system and problems posed by managing financial institutions in today's environment are studied. Students also assess the performance of financial institutions from a creditors, investors and regulators' viewpoint. The principles of asset liability management, capital and foreign exchange risk management are studied in response to a changing environment in prudential supervision and the important of the ending function. The subject topics include: banking risks, performance evaluation, capital adequacy, the formulation of loan policy, loan pricing, project finance, country risk analysis, trade and international finance.
Subject learning objectives (SLOs)
| 1. | Understand and appreciate sound and practical banking practices |
|---|---|
| 2. | Understand the various risks faced in managing a Financial Institution and how they may be managed |
| 3. | Understand the nature and management of key banking risks and capital adequacy issues |
| 4. | Appreciate the importance of the loan portfolio and the impact of lending on a banks balance sheet |
| 5. | Understand foreign exchange risks and international trade including country risk analysis and project financing |
Contribution to the development of graduate attributes
This subject contributes to the degree by exposing students to the core principles of financial institutions management in an international setting. This subject begins with an examination of the risks and issues in managing a Financial Institution. We consider some of the major risks faced by Financial Institutions when they are making decisions and the impact of lending and international financing. The foundations of banking are introduced in the early stages of the subject. It is necessary to have a solid understanding of the foundation material because subsequent topics build on the foundation knowledge that is presented in the early part of the subject.
This subject also contributes specifically to develop the following Program Learning Objectives:
- Demonstrate an awareness of conflicting ethical demands of various stakeholders within business (4.1)
- Evaluate business responses to ethical issues and dilemmas (4.2)
Teaching and learning strategies
The subject is based on a combination of dynamic and interactive lecture and practical workshop sessions. The lectures involve critical debate and the workshops are built around in-class exercises and presentations. Case studies will be a major component of these lectures and practical sessions. These classes will be supplemented with both printed and electronic learning materials and resources. All students will be provided with the opportunity for initial feedback on their performance in the subject during the first six weeks of the semester, for example, online quizzes, tutorial exercises, draft assignments and other assessment methods. Further feedback will be provided in relation to submitted assessment tasks.
Content (topics)
• Introduction to international banking and what makes financial institutions special?
• Measuring and evaluation of bank performance though financial statement analysis
• Asset liability management and specifically interest rate risk and liquidity risk
• Capital adequacy and the management of equity
• International banking including Foreign Exchange Markets risk.
• Country risk analysis and international finance and trade
• Understand the structure and role of the lending organisation.
• Understand the importance of loan policy and credit culture of a financial institution.
• Understand the issues in establishing a cost of bank funds and loan pricing.
• Explain the particular risks that apply to special markets such as project finance.
Assessment
Assessment task 1: Mid Semester Examination (Individual)
| Weight: | 40% |
|---|---|
| Length: | The mid-semester exam is a compulsory 1 hour exam. |
Assessment task 2: Final Examination (Individual)
| Weight: | 60% |
|---|---|
| Length: | The final exam is of 2 hours plus 10-minitue reading time duration |
Minimum requirements
Students must achieve at least 50% of the subject’s total marks.
Required texts
Rose P.S and Hudgins S. C., Bank Management & Financial Services, McGraw Hill, 2014 9th edition
Recommended texts
additional readings are provided
Other resources
Bruce R., McKern B., Pollard. And Skully M., Handbook of Australian Corporate Finance Butterworths 5th edition
Gup B., Fraser D. R. and Kolari J. W., Commercial Banking: The Management of Risk 3rd edition 2006
Koch T. W. and MacDonald S. Bank Management Thompson 6th edition 2006
Hughes, J.E and MacDonald, S B., International Banking Text and Cases Addison Wesley, 2002
Saunders A. and Cornett, M. M., Financial Institutions Management A risk Management Approach McGraw Hill, 2008 6th edition
Online material available through SILC folders