COURSE
INSTRUCTORS: GLADYS A. A. NABIEU (Mrs.) LEVEL: 400
CODE: PBBF 405
COURSE
TITLE: BANKING AND INVESTMENT ANALYSIS
COURSE DESCRIPTION:
The design of this
course provides a broader overview to the subject matter of banking and
investment. This
course aims to provide students an insight into the functioning of the Banks
and FIs (Financial Intermediaries). With financialization of the Global Economy,
Banks and other FIs (Financial Intermediaries) have played an increasingly
dominant role in the creation of credit and new financial services that have
had far-reaching implications in every walk of our lives. Therefore an
understanding of how banks and other financial intermediaries are managed; is
extremely important for insights into the workings of the Global Economy.
Banking and Investment Analysis is a
two-tier course. The first leg of this course provides the students with an
opportunity to gain a better understanding of banking concepts. It will
introduce students to the world of banking by looking at the industry both from
a historical and present day perspective. The course will help the students to
examine, how the focus in banking has shifted from a historical product-driven
focus to a customer-driven focus and the ways in which banking is using
multiple channels to service customers rather than relying solely on banking
offices. It will also provide insight into electronic banking channels being
employed by the banks to communicate with their customers and how the banking
globally has transformed from traditional branch banking to E-banking based on
internet, using computers and smart phones. Moreover it introduces them to the
international regulations and its developments throughout the last decade and
enables them to assess the compliance issues banks should keep.
Further, the course aims to
introduce students the financial services industry; mainly the unique nature of
its financial statements and the risks that are faced by banks. Considering the
effects of poor risk management on the failure of banks. The importance of risk
management in banks is becoming the most important function in bank financial
management. This course enables the students to indentify the different risks
faced by banks and how to calculate them then how to manage those risks. The
course will ensure that the students are able to understand the core and the
most important theoretical and practical banking concepts and functions in
deposits mobilization.
The second leg of this course discusses
how the deposits mobilized from the bank is put into prudent investments
ventures to yield the maximize the firm and shareholders' value. The course basically
entails key topics including: types of banking, banking operations, bank
regulations, some aspect of investment management and securities analysis. This
course applies the tools of investment in financial decision making. Emphasis
is placed on developing a framework for understanding the economic nature of banking
and investment, current trend in banking and investment, the concerns coming up
and their resolution.
PRE-REQUISITES
This course is designed
for degree course in banking and finance. It assumes the reader has completed a
first course in elements of banking, financial statements analysis, introduction
to business finance as well as quantitative methods. There is the need for
students to update themselves on topics such as: types of securities available
to businesses, the risk and return relationship in investment, the financial
markets in an economy etc. so that students understand how decisions in the
banking sectors are made. etc. The
breadth of the material covered during the course can be extensive but the
contents are not excessively technical in nature.
COURSE
OUTCOMES
Upon successful completion of this
course, students will have developed an understanding of an economy’s banking
and investment environment, the types of securities traded in an economy, the
appraisal of good banking investment activities as they relate to the financial
management of the firm and its interactions with the financial markets. Specifically
students
will:
- Examine the special role, structure and performance of banking and investments in an economy.
- Demonstrate knowledge and understanding of banking and risk management in the banks through analytical studies
- Demonstrate a range of skills acquired in banking & investment relevant for financial decision-making and problem solving
- Acquire the skills necessary to undertake a higher research degree and/or for employment in a higher capacity in industry or area of professional practice relating to banking and investments.
·
Have
a broad understanding of the investment banking industry and its
interdependence with other parts of the financial world
·
Recognize
the key services and products provided by the a bank and what these services
and products mean to end-users
·
Develop
independent thinking, by analyzing news items from a banker’s standpoint: how
and why the deals are done, how the products are sold and risk managed, how the
money is made
·
Broaden
and deepen their understanding of banking by utilizing tools and methods
learned from other courses such as: quantitative methods, risk management,
securities markets and derivative products and applying them in the banking
industry.
·
Develop
effective communication in oral and written English through group presentations,
assignments, quizzes as well as sharing and appraising each other’s works.
·
Discuss
the ethical and professional responsibility of
bankers, identify the importance
of personal and organization integrity in this industry.
·
Learn
teamwork skills and become more effective team members and leaders
·
Assess
whether a career in a bank is what they would like to pursue and have a
reasonable amount of knowledge about the industry which will be helpful for
their application for internships and positions
COURSE OBJECTIVES
This course is
designed to provide students with a deeper understanding of how banks mobilize and
manage its business activities in the `real world'. The primary objective is to
provide the student with the tools to understand and solve the basic banking
and investment decisions confronting both individuals and businesses today. Specifically,
the objectives of this course are to:
·
Enable students to recognize the basic
tools used by depository financial institutions for financial and investments
decisions making under all conditions.
·
Expose students to the various ways by
which firms may raise and invest funds from the financial markets.
·
Aid figure out the reason for bank
regulation and its implication on the financial system of an economy
·
Appreciate
the nature of legal relationships between the banker and the customer.
·
Improve
students’ understanding of contractual terms and their importance in business
and financial services.
·
Acquire the language for describing the banking financial
institutions and its performance
·
Enhance
the ability to understand and discuss banking news and trends as presented in
the media.
·
Enable
the students to be able to write various report papers and correspondence on
specialized banking topics
·
Study
the various products and services offered by the modern bank.
·
Grasp
the credit appraisal mechanism and appreciate the bank profitability in greater
detail.
·
Develop
the basic understanding of e-banking specially in relation to banks.
·
Provide
the necessary skill set to work in e banking environment and foster understanding
of future vision and of e-banking.
·
Understand
the process of financial intermediation and dis- intermediation.
·
Have
a thorough knowledge of expanding financial services industry.
·
Provide
students with a good understanding of the basic principles of the banking business in Ghana.
·
Develop
a perspective regarding the new opportunities emerging for banks in the
financial sector.
·
Help students analyze a firms securities
using fundamental and technical scrutiny for both personal and business
investment decision making.
COURSE
OUTLINE IN A WEEKLY FORMAT
WELCOME TO THE CLASS OF BANKING AND INVESTMENT ANALYSIS
First Week: GETTING STARTED: COURSE EXPECTATIONS AND
INTRODUCTION
You are all welcome to the Class of
banking and investment analysis where every individual would be given the
opportunity to get involved in all discussions through participation. It is our
hope that you would take advantage of the opportunities offered by this
learning environment to achieve the objectives you have set for yourself. Good
Luck.
Week 1: Overview of Banking – What are Banks
Introduction
The Meaning of a Bank and Banking Business
Types of Banks
The Banking Structure in Ghana
Banks and the Principal Agent Problem
The Economic Functions and the Role of Banks in a
Modern Economy
Conclusion
Week 2: Banking
Operations – What do banks do
Introduction
The Banker and Customer
& Banker-Customer Relationship
Opening and Operating
Bank Accounts
Cheques
Standard
Banking Services
Types of Banking
Conclusion
Week 3: Central Banking
Introduction
The objectives of the
central bank
The main functions of
Central Banking
Policies of the Central
Bank
How does central bank
Monetary Policies work
Conclusion
Week 4: Global
Regulation of Banks
Introduction
Meaning of Bank
Regulation
The
Rationale for Regulation
The General Principles
and Requirements of Bank Regulations
Types of Bank Regulation
International
Regulations
Drawbacks of Regulation
Conclusion
Week 5: Managing Banks
Introduction
Banking Business
Operation Replica
The Bank Balance Sheet
and Income Structure
Bank Performance and
Financial Ratio Analysis
Managing
Banks
Asset
Management
Liability
Management
Liquidity Management
Capital
Adequacy Management
Off-Balance
Sheet Management
Loans Securitization
Conclusion
Week 6: Risks and
Management of Risks in Banking
Introduction
Categories of
Fundamental Risks in Banks
Credit Risk
Interest
Rate Risk
Liquidity
risk
Market Risk
(Trading Risks)
Operational
Risk
Capital Adequacy
Risks
Other
Categories of Risks
Conclusion
Week 7: Overview of
Investment Management
Introduction
Meaning of Investment
and Investment Analysis
Nature of Investment
Investment Environment
Conclusion
Week 8: The Investment
Process
Introduction
The Investment Process
Participants of the
Investment Process
Regulatory Bodies
Conclusion
Week 9: Financial
Market Analysis
Introduction
Meaning of Financial
Market and Types of Financial Markets
How Companies Raise
Capital in Financial Markets
Analysis of Financial
Markets
Conclusion
Week 10: Securities
Analysis
Introduction
Fundamental Analysis
Economic
Analysis
Industry
Analysis
Company
Analysis
Technical Analysis
Conclusion
Application Pedagogy:
Lecture format will include
discussions, group work, presentations, as necessary. Student will be expected
to participate actively in all teaching and learning activities. Students will
be expected to read the text or other assigned recommended readings.
Guide
to Final Examination and Assessments
There
shall be assignments, unannounced quizzes and mid-semester
exams from various topics in the Course Outline. The final examinations shall
be a two and half hour paper with a compulsory section. Allocation of Marks
shall be as follows;
Final
Exams 70%
Assignments
/ Mid-Semester Exams / Group Work / Interim Assessment 30%
Total 100%
