SOAS University of London

School of Finance and Management

Banking and capital markets

Module Code:
15PFMC056
Credits:
15
Taught in:
Term 2

The module is concerned with the structure and operation of financial intermediaries and capital markets. It is the aim of this course to provide students with a sound understanding of theoretical and applied issues in banking and capital markets. Upon the completion of the course, students will have an understanding of the relative merits of these two distinct financial institutions, of the sources of banking instability, and of the role of regulation.

Objectives and learning outcomes of the module

On successful completion of the course, students will be able to:

  • Understand the reasons for the existence of financial intermediaries
  • Understand how information imperfections shape the working of both markets and financial institutions
  • Analyse and assess policy and regulatory framework
  • Evaluate the impact of phenomena like credit bubbles, bank runs, credit rationing

Workload

Lectures
This module consists of a 1-hour weekly lecture over 10 weeks of term plus a revision lecture in term 3 as preparation for the final examination. Students will be supplied with a syllabus with a breakdown week by week of required and additional reading. Reading materials are usually accessed electronically from the BLE and students should come to class prepared.

Tutorials
This module also has a weekly 1-hour tutorial where the questions posed by the tutor relevant to the lecture are explored and discussed by the students. Students also prepare and deliver a short presentation.

Total Work load:
Students on this module will have 2 taught hours each week. Additionally, adequate personal study time should be allocated for reading and class preparation.

Method of assessment

Assessment for this module is in three elements:

  1. One tutorial presentation at 10%
  2. One essay of 2,500 words at 30%
  3. One unseen 2-hour written examination at 60%

All elements except the presentation may be resubmitted.

Suggested reading

Indicative Readings:

  • F. Allen and D. Gale , (2001). Comparing financial systems, MIT Press. Ch. 2 and 3.
  • X. Frexias and J.C. Rochet (1997) Microeconomics of Banking, MIT Press. Ch. 1,2.
  • D. Diamond and P. Dybvig. (1983) Bank Runs, Deposit Insurance, and Liquidity. Journal of Political Economy 91, 401419.

Disclaimer

Important notice regarding changes to programmes and modules