Module title: Financial Services Risk Management

SCQF level: 10:
SCQF credit value: 20.00
ECTS credit value: 10

Module code: FIN10109
Module leader: Henry Huang
School The Business School
Subject area group: Accountancy Finance and Law
Prerequisites

There are no pre-requisites for this module to be added

2019/0, Trimester 1, Face-to-Face, Edinburgh Napier University
Occurrence: 001
Primary mode of delivery: Face-to-Face
Location of delivery: CRAIGLOCKHAR
Partner: Edinburgh Napier University
Member of staff responsible for delivering module: DR MAURICIO SILVA
Module Organiser:


Learning, Teaching and Assessment (LTA) Approach:
Lectures will provide you with an overview of key issues and concepts in order to guide your individual reading and research (LO1 to LO5). Tutorials will reinforce learning by providing opportunities for you to ask questions and seek further clarification on aspects of the module and for general discussion of relevant topical issues. The tutorials will also give you opportunities to develop a range of interpersonal and communicative skills through a programme of predominantly student-led activities, such as question and answer sessions, discussion of relevant topical issues and seminars directed at developing skills in group-work.

You will be directed to relevant reading for private study and research. You will also be expected to use academic journals, periodicals and official publications, whether taken in hard copy in the Library or via the wide range accessible in electronic journal form (see reading list), to augment their learning.

Embedding of employability/PDP/scholarship skills

Key employability skills are embedded:
Teamwork and leadership: prepare tutorial presentations in small teams.
Communication: written through coursework and examination and oral in the delivery of group presentations and tutorial discussions.
IT and analytical skills: throught the preparation of the powerpoint presentation, online research, and data analysis software.
Business awareness through the efforts made to blend theory with the practical financial services environment.

Assessment (formative and summative)

Formative assessment incorporates an essay of around 2,000 words which covers learning outcomes 1 to 5 and is submitted in week 7. Summative assessment is an end of semester examination covering all learning outcomes of the module.

Research/Teaching linkages

You are encouraged to develop and use research skills in the preparation of their presentations and in the coursework and, in addition, the module content often assist in the selection of t

Formative Assessment:
The University is currently undertaking work to improve the quality of information provided on methods of assessment and feedback. Please refer to the section on Learning and Teaching Approaches above for further information about this module’s learning, teaching and assessment practices, including formative and summative approaches.

Summative Assessment:
The University is currently undertaking work to improve the quality of information provided on methods of assessment and feedback. Please refer to the section on Learning and Teaching Approaches above for further information about this module’s learning, teaching and assessment practices, including formative and summative approaches.

Student Activity (Notional Equivalent Study Hours (NESH))
Mode of activityLearning & Teaching ActivityNESH (Study Hours)
Face To Face Lecture 24
Face To Face Practical classes and workshops 12
Independent Learning Guided independent study 162
Face To Face Centrally Time Tabled Examination 2
Total Study Hours200
Expected Total Study Hours for Module200


Assessment
Type of Assessment Weighting % LOs covered Week due Length in Hours/Words
Report 40 1 - 5 7 HOURS= 0, WORDS= 1500-2000
Centrally Time Tabled Examination 60 1 - 5 13 HOURS= 2, WORDS= 0
Component 1 subtotal: 40
Component 2 subtotal: 60
Module subtotal: 100

Description of module content:

Teaching of this module is divided in three sections: Part (I) Introduction, a critical discussion of the current academic literature and business reports on the impact of current events on the risk exposure of investment and commercial banks, finance companies, and insurance companies, and other financial services firms according to their main functions and activities. Part (II) Risks, a critical analysis, evaluation and measurement of the following risks within the financial services environment: (1) Interest Rate risk; (2) Market risk; (3) Credit risk; (4) Off-balance sheet risk; (5) Foreign exchange risk (6) Liquidity risk (7) Country/Sovereign risks. Part (III) Risk Management Strategies, analysis and evaluation of the following (1) Deposit insurance: the rationale of deposit insurance; the moral hazards involved and the corresponding solutions in deposit insurance; deposit insurance schemes, their main functions and success in light of the banking and financial crisis; (2) Diversification: critical understanding of diversification mechanisms; relating diversification to managing credit and market risk incurred by FIs; being able to calculate the variance and return of the portfolios. (3) Derivatives: understanding forward, future, option and swap; their differences; their advantages and disadvantages in managing risks. (4) Securitisation: loan sale; its benefit to banks; securitisation; the types of assets that can be securitised and its impact on FIs.

Learning Outcomes for module:

On successful completion of this module you will have:

LO1: A critical understanding of the variety and complexity of risks associated with different aspects of financial institutions, their implication to the firm and its stakeholders;

LO2: An advanced knowledge and critical understanding of how derivative financial instruments can be used to manage Financial Services risks and the potential problems associated with the use of these instruments

LO3: An advanced understanding of different risk management strategies using forwards, futures, options and swaps, including an understanding of the complexities and problems associated with the use of such strategies;

LO4: Developed specialised and advanced technical quantitative skills to analyse the extent to which risk management is successful;

LO5: Evaluated the complexity of risk management strategies within the financial industry and their implications to policy makers, regulators and financial institution professionals.

Indicative References and Reading List - URL:

Core - SAUNDERS, A. AND CORNETT, M. (2014) FINANCIAL INSTITUTIONS MANAGEMENT: A RISK MANAGEMENT APPROACH: MCGRAW-HILL (ASIA), 8th ed.
Recommended - HULL, J.C. (2012) RISK MANAGEMENT AND FINANCIAL INSTITUTIONS: JOHN WILEY & SONS, 3rd ed.
BESSIS, J. (2010) RISK MANAGEMENT IN BANKING: JOHN WILEY & SONS, 3rd ed.
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