Course 2023-2024 a.y.

The analysis is carried out along the following streams:

• The banking industry today: players, strategies, and regulation.
• Liabilities management and credit policy in banking: financial instruments and business practices.
• Banking business and risk management: credit risk and the NPL issue, interest rate risk, market risk.
• Financial statement analysis and performance measures in banking.
• The insurance industry today: players, strategies and regulation.
• Insurance process and insurance premiums.
• Risk and capital management for insurers.
• Financial statement analysis and performance measures in insurance.

• Describe the characteristics of the banking and insurance businesses (what do banks and insurance companies do? which is their core business?).
• Identify the main drivers of banks' funding, credit, and investment decisions.
• Recognize the most prominent risk factors and how these risks are measured and managed.
• Explain how the regulatory framework affects banks and insurance companies.

• Assess and interpret facts relevant to financial institutions in the real world.
• Examine banks’ and insurance companies’ behavior and identify the main drivers of their performance.
• Assess and measure banks’ and insurance companies’ performance (e.g. profitability, liquidity, asset quality, capitalization).
• Identify and measure the main sources of banks' risks (e.g., exposure to interest rate risk).
• Discuss the benefits and flaws of financial institutions regulation as well as hypothesize the main potential effects of new set of rules.

• Face-to-face lectures
• Guest speaker's talks (in class or in distance)
• Exercises (exercises, database, software etc.)

Formal face-to-face lectures are complemented with guest speakers' talks from the industry (e.g. bankers and regulators) to gain focus on specific and up-to-date topics. Lectures are structured based on empirical evidence and incidents, stylized facts are presented and commented in class, practical examples of instruments and techniques are proposed. Consistently traditional material (e.g. textbook/ebook and slides) are complemented and empowered by academic papers, institutional analyses (e.g. banking authorities and analysts reports), relevant newspaper articles (e.g. FT columns), and Excel spreadsheets.

Students are evaluated on a closed books, closed answers individual written exam (two partials exams or one general exam, at their choice). The rules set out in the "Guides to the University" apply to sitting/registering for partial exams. The exam gauges students’ ability to: recognize different aspects of banks and insurance companies activity, e.g., the specificities of their business models; identify the drivers of banks’ funding and investment strategies; spot the main sources of risks, and how these risks are measured and managed. Exam questions are structured to assess multiple skills: qualitative and critical abilities (e.g., by selecting the option that better reflects bank regulators’ view point on a given matter) as well as quantitative skills (e.g., by measuring banks’ exposure to certain risks).

• Peter Rose and Sylvia Hudgins (2013) Bank Management & Financial Services, ninth edition, McGraw-Hill (selected chapters/sections); Anthony Saunders, Marcia Cornett and Otgo Erhemjamts (2021), Financial Institutions Management: A Risk Management Approach, tenth edition, McGraw-Hill (selected chapters/sections). Selected chapters are included in the Management of Financial Institutions (cod. 30148) textbook (hard copy available at Egea Bookshop).
• Additional material (readings, slides and teaching notes) available in Bboard.