30178 - INTERNATIONAL BANKING

Basic knowledge of the financial system is useful.

The course focuses on the role of international banks and other international financial institutions. The course discusses (1) the main functions of the financial system in the economy and the different types of financial institutions and financial markets; (2) the types of risks faced by financial institutions and the determinants of bank failures; (3) the rationale for financial regulation; (4) the evolution of financial regulation, with particular emphasis on capital regulation and resolution (5) the developments in the international regulatory architecture in the last decade. Particular attention is devoted to the European banking industry. The course, which complements courses on risk management and management of financial institutions, is ideal for students who wish to learn the dynamics of the financial system in dept and be updated on the regulatory response to the global financial crisis.

• Main functions of the financial system in the economy.
• Commercial and investment banks, financial ratio analysis.
• Institutional investors: Mutual funds and hedge funds.
• Financial risks: Interest rate risk, market risk, credit risk, foreign exchange risk, operational risk, off-balance sheet, sovereign risk.
• Liquidity and systemic risk.
• Safety net: deposit insurance and lender of last resort.
• Capital and liquidity regulation: Basel I, II and III.
• Banking union and post crisis financial architecture.
• Paradigm shift: from bail-out to bail-in.
• Bank - sovereign loop and regulatory proposals.

• Describe the different financial institutions operating in the financial system.
• Illustrate the dynamics of the financial industry in the last two decades.
• Identify the main risks affecting financial institutions, distinguishing idiosyncratic and systemic sources of risk.
• Illustrate the regulatory changes taking place after the financial crisis.
• Estimate the effects of the recent regulatory for the stability of financial institutions and for investors. 

• Analyze the risks affecting financial institutions, evaluate their solvency state, develop the implications of financial regulation for bank business and design crisis management tools. 

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

• Guest speakers: there is at least two guest lectures with experts from private and central banks
• Exercises: there are at least six exercise type classes, where the concepts learnt in the lectures are applied to solve concrete problems.
• Case studies: there are various case studies to understand the application of the concepts learnt in class to the real world.

There is no distinction between attending and non-attending students. All students can choose to take a partial exam and a final exam, or a final exam only. Both the partial and the final exams contain only closed form questions. 

The reference list is communicated at the beginning of the course.