Year
2021
Units
4.5
Contact
1 x 3-hour workshop weekly
Prerequisites
1 of BUSN1014, BUSN2008
Enrolment not permitted
BUSN2002 has been successfully completed
Topic description

Financial institutions comprise banks, building societies, credit unions, trust, insurance and mortgage loan companies. This topic will explain how the managers of these institutions, particularly commercial banks, make decisions about the asset and liability structures of their balance sheets, including decisions on loans, securities, capital, deposits and other funding sources. It will explore the performance of financial institutions and explain how interest rates impact on profitability and risk. The topic also briefly considers other risks faced by financial institutions and risk mitigation techniques. The international regulatory environment is also described.

Educational aims

This topic aims to:

  • Explain how the managers of commercial banks and other financial institutions make decisions about the asset and liability structures of their balance sheets, including decisions on loans, securities, capital, deposits and other funding sources
  • Assess the performance of financial institutions and explain how interest rates impact on profitability and risk
Expected learning outcomes
On completion of this topic you will be expected to be able to:

  1. Describe the functions performed by banks and other financial institutions
  2. Briefly explain the risks faced by financial institutions and the methods they use to mitigate these risks
  3. Interpret the financial statements of financial institutions
  4. Calculate key performance indicators
  5. Analyse the performance of financial institutions
  6. Explain the key role of capital
  7. Compare and contrast strategies to manage funding and liquidity
  8. Compare and contrast strategies to manage the securities portfolio
  9. Describe several methods used to assess loan applications
  10. Discuss regulations, the regulatory environment and resolution of bank failures

Key dates and timetable

(1), (2)

Each class is numbered in brackets.
Where more than one class is offered, students normally attend only one.

Classes are held weekly unless otherwise indicated.

FULL

If you are enrolled for this topic, but all classes for one of the activities (eg tutorials) are full,
contact your College Office for assistance. Full classes frequently occur near the start of semester.

Students may still enrol in topics with full classes as more places will be made available as needed.

If this padlock appears next to an activity name (eg Lecture), then class registration is closed for this activity.

Class registration normally closes at the end of week 2 of each semester.

Classes in a stream are grouped so that the same students attend all classes in that stream.
Registration in the stream will result in registration in all classes.
  Unless otherwise advised, classes are not held during semester breaks or on public holidays.