Students

AFIN8003 – Banking and Financial Intermediation

2024 – Session 1, In person-scheduled-weekday, North Ryde

General Information

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Unit convenor and teaching staff Unit convenor and teaching staff Unit Convenor
Mingze Gao
mingze.gao@mq.edu.au
Credit points Credit points
10
Prerequisites Prerequisites
(Admission to MActPrac or MFin) or (ACST603 or ACST6003 or AFIN6012 or ECON649 or ECON6049)
Corequisites Corequisites
Co-badged status Co-badged status
Unit description Unit description

This unit applies finance theory to the context of operational decision-making and risk management in banking and financial intermediation. The major decision areas for banking management are covered within a regulatory and corporate responsibility framework. Major risks of banks and financial intermediation are being examined.

Important Academic Dates

Information about important academic dates including deadlines for withdrawing from units are available at https://www.mq.edu.au/study/calendar-of-dates

Learning Outcomes

On successful completion of this unit, you will be able to:

  • ULO1: Examine how financial institutions provide a special set of services to households and firms.
  • ULO2: Explain how banks are regulated and why their risk-taking activities are subject to regulatory oversight.
  • ULO3: Evaluate the risks which banks face and demonstrate how these risks are managed.
  • ULO4: Assess adequacy of a bank's capital base.

General Assessment Information

Late Assessment Submission Penalty (written assessments) 

Unless a Special Consideration request has been submitted and approved, a 5% penalty (of the total possible mark) will be applied each day a written assessment is not submitted, up until the 7th day (including weekends). After the 7th day, a grade of ‘0’ will be awarded even if the assessment is submitted. Submission time for all written assessments is set at 11.55pm. A 1-hour grace period is provided to students who experience a technical concern.  

For any late submissions of time-sensitive tasks, such as scheduled tests/exams, performance assessments/presentations, and/or scheduled practical assessments/labs, students need to apply for Special Consideration.

Assessment Tasks

Name Weighting Hurdle Due
Mid-Session Test 20% No Week 7
Assignment 30% No Week 12
Final Examination 50% No University Examination Period

Mid-Session Test

Assessment Type 1: Quiz/Test
Indicative Time on Task 2: 10 hours
Due: Week 7
Weighting: 20%

 

A mid session test will be held during the session.

 
On successful completion you will be able to:
  • Examine how financial institutions provide a special set of services to households and firms.
  • Explain how banks are regulated and why their risk-taking activities are subject to regulatory oversight.
  • Evaluate the risks which banks face and demonstrate how these risks are managed.
  • Assess adequacy of a bank's capital base.

Assignment

Assessment Type 1: Report
Indicative Time on Task 2: 20 hours
Due: Week 12
Weighting: 30%

 

Students will complete an individual assignment related to the banking and finance industry.

 
On successful completion you will be able to:
  • Examine how financial institutions provide a special set of services to households and firms.
  • Explain how banks are regulated and why their risk-taking activities are subject to regulatory oversight.
  • Evaluate the risks which banks face and demonstrate how these risks are managed.
  • Assess adequacy of a bank's capital base.

Final Examination

Assessment Type 1: Examination
Indicative Time on Task 2: 25 hours
Due: University Examination Period
Weighting: 50%

A two hour exam will be held during the University Examination Period.


On successful completion you will be able to:
  • Examine how financial institutions provide a special set of services to households and firms.
  • Explain how banks are regulated and why their risk-taking activities are subject to regulatory oversight.
  • Evaluate the risks which banks face and demonstrate how these risks are managed.
  • Assess adequacy of a bank's capital base.

1 If you need help with your assignment, please contact:

  • the academic teaching staff in your unit for guidance in understanding or completing this type of assessment
  • the Writing Centre for academic skills support.

2 Indicative time-on-task is an estimate of the time required for completion of the assessment task and is subject to individual variation

Delivery and Resources

Required technology: Non-programmable calculator.

Learning and teaching strategy: Classes typically consist of a two-hour lecture followed by a one-hour tutorial. Lectures are used to show how the topic fits into the overall unit aims and to establish theory principles. Tutorials are used to apply concepts to real world problems and review homework problems. Participation is strongly encouraged for you to check your progress towards achieving the learning outcomes for the unit.

Textbook: The textbook for the unit is Lange, H., Saunders, A. and Cornett, M.M. (2015), Financial Institutions Management: A Risk Management Approach, 4th edition, McGraw-Hill. Textbook material will be supplemented by articles and handouts. Chapters from the textbook and specified articles should be read prior to attending the scheduled lecture on that topic. Homework problems will be assigned at the end of lectures and should be completed before the tutorial the following week. Handouts and homework questions can be downloaded from the unit's iLearn site each week.

Online learning: iLearn (https://ilearn.mq.edu.au) provides the main online learning support. It is essential that you log in at least twice per week to keep abreast of unit-wide announcements and use the resources to supplement your learning. Lecture slides are available online beforehand for you to download from iLearn. Solutions to homework problems are made available online after the problems are discussed in the tutorial.

Unit Schedule

Week

Topic

Week 1

Introduction to Financial Intermediation and Banks

Week 2

Risk of Financial Intermediation

Week 3

Interest Rate Risk

Week 4

Managing Interest Rate Risk

Week 5

Market Risk

Week 6

Credit Risk I: Individual Loan Risk

Week 7

Midterm Exam

Week 8

Credit Risk II: Loan Portfolio and Concentration Risk

Week 9

Sovereign Risk, Foreign Exchange Risk, and Liquidity Risk

Week 10

Liability and Liquidity Management

Week 11

Off-Balance-Sheet Risk

Week 12

Capital Management and Adequacy

Week 13

Review

Policies and Procedures

Macquarie University policies and procedures are accessible from Policy Central (https://policies.mq.edu.au). Students should be aware of the following policies in particular with regard to Learning and Teaching:

Students seeking more policy resources can visit Student Policies (https://students.mq.edu.au/support/study/policies). It is your one-stop-shop for the key policies you need to know about throughout your undergraduate student journey.

To find other policies relating to Teaching and Learning, visit Policy Central (https://policies.mq.edu.au) and use the search tool.

Student Code of Conduct

Macquarie University students have a responsibility to be familiar with the Student Code of Conduct: https://students.mq.edu.au/admin/other-resources/student-conduct

Results

Results published on platform other than eStudent, (eg. iLearn, Coursera etc.) or released directly by your Unit Convenor, are not confirmed as they are subject to final approval by the University. Once approved, final results will be sent to your student email address and will be made available in eStudent. For more information visit ask.mq.edu.au or if you are a Global MBA student contact globalmba.support@mq.edu.au

Academic Integrity

At Macquarie, we believe academic integrity – honesty, respect, trust, responsibility, fairness and courage – is at the core of learning, teaching and research. We recognise that meeting the expectations required to complete your assessments can be challenging. So, we offer you a range of resources and services to help you reach your potential, including free online writing and maths support, academic skills development and wellbeing consultations.

Student Support

Macquarie University provides a range of support services for students. For details, visit http://students.mq.edu.au/support/

The Writing Centre

The Writing Centre provides resources to develop your English language proficiency, academic writing, and communication skills.

The Library provides online and face to face support to help you find and use relevant information resources. 

Student Services and Support

Macquarie University offers a range of Student Support Services including:

Student Enquiries

Got a question? Ask us via AskMQ, or contact Service Connect.

IT Help

For help with University computer systems and technology, visit http://www.mq.edu.au/about_us/offices_and_units/information_technology/help/. 

When using the University's IT, you must adhere to the Acceptable Use of IT Resources Policy. The policy applies to all who connect to the MQ network including students.

Unit information based on version 2024.02 of the Handbook