Checking date: 23/03/2023


Course: 2023/2024

Risk management - central banks
(19338)
Master in Finance / Máster Universitario en Finanzas (Plan: 483 - Estudio: 261)
EPE


Coordinating teacher: MARTINEZ MIERA, DAVID

Department assigned to the subject: Business Administration Department

Type: Electives
ECTS Credits: 3.0 ECTS

Course:
Semester:




Requirements (Subjects that are assumed to be known)
Corporate Finance
Objectives
Students will understand the role of banks in the economy and the challenges faced by regulators. They will be able to asses the positive and negative consequences of bank regulation and their impact on financial stability. Professors: 1) David Martinez Miera (Uc3m, PhD) 2) Salvador Bekiaropoulos (ECB)
Skills and learning outcomes
Description of contents: programme
1. Bank Runs 1.1. The Diamond-Dibvig Setup 1.2. How to prevent bank runs 2. The Role of Informed Financial Intermediaries 2.1. The Hölmstrom-Tirole Setup 2.2. The role of net wealth 2.3. The Debt Overhang problem 2.4. The dark side of deposit insurance 3. Competition and Bank Risk 3.1. The Allen and Gale setup 3.2. The Boyd and De Nicolo critique 4. Bank Capital Regulation 4.1. Risk Insensitive Capital Regulation 4.2. Risk Sensitive Capital Regulation 5. Macroprudential Regulation 5.1. Countercyclical Capital Requirements 5.2. Current developments on macroprudential policies
Learning activities and methodology
Teaching will by done using power point and recommended readings. Students will also be expected to read some proposed readings and will have to do some exercises at home and in class. Office hours: On an appointment basis
Assessment System
  • % end-of-term-examination 60
  • % of continuous assessment (assigments, laboratory, practicals...) 40
Calendar of Continuous assessment
Basic Bibliography
  • Franklin Allen and Douglas Gale. Comparing Financial Systems. MIT PRESS. 2000
  • Xavier Freixas and Jean Charles Rochet. Microeconomics of Banking. MIT PRESS. 1997

The course syllabus may change due academic events or other reasons.