COMMERCIAL BANKING

SHE Level 5
SCQF Credit Points 15.00
ECTS Credit Points 7.50
Module Code MMN326036
Module Leader Mauricio Silva
School Glasgow School for Business and Society
Subject Finance and Accounting
Trimesters
  • B (January start)
  • A (September start)
  • C (May start)

Pre-Requisite Knowledge

Knowledge UK Honours degre or equivalent

Summary of Content

This module was designed to offer students the opportunity to examine the evolving nature of the commercial banking industry. Focusing on recent events, trends and issues, students will examine the asset structures and revenue earning features of commercial banks and the impact new technologies and non-bank competitors are having on their viability as businesses. They will also study how cultural and economic trends are impacting banking products and services (and their cost and benefit features), not only changing the industry but also how society engages with commercial banking. This module aims to develop in students the skills and knowledge to critically analyse, evaluate, and formulate strategies to maximise the value of a commercial bank's balance sheet and manage its resources within regulatory constraints. It was designed to familiarise students with the process of planning and implementing management strategies for commercial banking including finding operational efficiencies, assessing the challenges and opportunities of new technologies, developing sales strategies to gain market share, maximising efficiencies through scope and scale, and marketing of banking products and services. Students will apply theoretical models and financial techniques to the analysis of commercial banks' performance and identify and measure potential issues and problems related to its operations. They will also evaluate the bank's strategy in the context of ethical behaviour, social, and environmental sustainability.

Syllabus

-360 - Introduction: the changing nature of commercial banking; - Developing commercial bank strategies: measurement, analysis and theory of value creation; - Evaluating a commercial bank's viability: financial statement analysis; -357 - Strategies for value creation in commercial banking: asset and liability management; - Planning and managing deposits and bank funds; - Planning and managing capital under Basle III; - Planning and managing the security portfolio; - Planning and managing consumer loans; - Planning and managing payment systems; - Bank organisational structures: adapting to competitive challenges; -360 - Banking operations and technologies.

Learning Outcomes

On successful completion of the module the student should be able to:1. Critically analyse the major drivers of strategic and operational change in the commercial banking sector including new technologies, cultural trends, socio-political conditions, and global economic crises 2. Critically analyse, plan, develop, and evaluate governance strategies that consider and anticipate current and future potential conflicts of interest and ethical dilemmas in the financial and operational management of commercial banks3. Critically assess and evaluate the financial resilience of commercial banks through the analysis of its assets and liabilities, operational costs and revenue streams, exposure to market, credit, liquidity, and interest rate risks, and exposure to regulatory changes4. Critically understand the market for the products and services of commercial banks and develop strategies to maximise shareholders' value within economic, technological, competitive, social, and regulatory constraints5. Critically analyse the economic cost and availability of inputs for the operationalisation of financial and commercial strategies, including but not limited to: human resources, product and service design and launch, sales and marketing, new technologies development and implementation, data and information protection, social responsibility initiatives, environmental practices and general management of commercial banks6. Evaluate the different organisational models, financial structures, operational schemes, and the inputs necessary to create strategies that allow banks to adapt to the changes in the demand for commercial bank products and service

Teaching / Learning Strategy

This module employs a combination of lectures and lab sessions that aim to enable students to gain a critical understanding of commercial bank management and strategy and directed learning supported by GCU Learn. Lectures will be used to highlight the key issues in a specific topic and point the way towards relevant journal articles and other appropriate literature. Students are expected to prepare for following week's lectures on each topic by engaging in literature searches, undertaking relevant reading and where necessary, attempt computational questions. The lectures will adopt a variety of teaching styles including seminar style contributions such as group discussions to enhance intellectual, critical and analytical skills. For more applied topics, students will be required to attempt relevant problem or scenario based questions prior to the lectures, providing the basis for deepening professional skills, knowledge, and understanding. The teaching/learning strategy is supported by lab/seminar sessions in which case studies related to current financial market and industry are used to contextualise theories and concepts. These sessions will provide the medium for gaining practical skills through the use of data analysis software to explore the lecture themes in more detail. They allow students the opportunity to use theoretical knowledge in an applied context to test not only their understanding of formal concepts but also their numeracy and technical skills. Activities will also enable students to critically evaluate how industry participants are currently employing analytical methods. All students will be directed to further reading to support the theoretical and practical content of the module. Every student will have access to a comprehensive study guide in the form of a module handbook as well as to lecture slides, reading materials, lab/seminar questions, assessment requirements, and announcements through the VLE At postgraduate level it is expected that students are able to manage their study: completion of questions/problems/exercises in advance of lab/seminar sessions, as well as preparation for lectures by advanced reading of textbooks and academic journal articles. Feedback Strategy - Aims Students will be provided with feedback within three weeks of submission. The feedback that they receive is designed to: A: Facilitate the development of self-assessment; B: Encourage dialogue; C: Clarify good performance; D: Provide opportunities to close the gap between current and desired performance; E: Deliver high quality information about individual learning; F: Encourage positive motivational beliefs and self-esteem; G: Provide information to teachers that can be used to help shape the teaching. In order to achieve these aims, the following strategies will be adopted by this module: A: Facilitating the development of self-assessment: The assessment requirements will be discussed in the introduction to the module. Students will be asked to reflect on the standard of their work. B: Encouraging dialogue: Students are encouraged to discuss their comments with lecturers, arrange meetings with academic advisors to review performance. C: Clarifying good performance: Students will be provided with information about marking criteria. They will also be provided with examples of assessments to review in order to identify and clarify good performance (as per A). D: Providing opportunities to close the gap between current and desired performance: Students may find it helpful to identify actions points based on the feedback they have received. E: Delivering high quality information about individual learning: Feedback will be provided within 3 weeks of submission, covering strengths, weaknesses and corrective advice. F: Encouraging positive motivational beliefs and self-esteem: Feedback will be designed to encourage and be constructive.

Indicative Reading

Textbooks: 1. Koch, T. and MacDonald, S. (Latest Edition) 'Bank Management', South-Western Cengage Learning 2. Rose, P.S. and Hudgins, S.C. (2010) 'Bank Management and Financial Services', McGraw-Hill. Newspapers and Magazines: -360 1. The Financial Times. 2. The Wall Street Journal. 3. The Daily Telegraph 4. The Times 5. The Banker Financial World 6. Euro money 7. The Economist 8. Forbes Fortune Business Week Journals: -360 1. Journal of Commercial Lending 2. Journal of Bank Marketing 3. Journal of Risk and Uncertainty 4. The Journal of Financial Services Research 5. Journal of Finance 6. Journal of Forecasting, 7. Journal of Banking and Finance 8. The Journal Financial Intermediation Internet sites: European Central Bank: www.ecb.europa.eu <http://www.ecb.europa.eu>. Bank for International Settlements: www.bis.org Bank of England: www.bankofengland.co.uk? British Bankers Association: www.bba.org.uk? Chartered Bankers Institute: www.charteredbanker.com <http://www.charteredbanker.com> Financial Times: www.ft.com Economist: www.economist.com? Financial Conduct Authority: www.fca.gov.uk? Wharton Financial Institutions Center: https://fic.wharton.upenn.edu/

Transferrable Skills

On successful completion of the module students will be able to: -360 1. Develop and define complex argument and provide critical insights on the practical financial, business, institutional and policy problems of the commercial banking sector. 2. Read, critically analyse and summarise transactions and economic events related to financial services providers such as both commercial banks. 3. Apply numerical skills to solve numerical problems faced by financial institutions. 4. Read, critically analyse and evaluate, and summarize economic, financial and business events relating to financial institutions. 5. Locate, extract, and analyse data from different sources and present it in an appropriate format. 6. Plan and work independently using various learning resources. 7. Use information technology to acquire, analyse, and communicate effectively.

Module Structure

Activity Total Hours
Independent Learning (FT) 84.00
Assessment (FT) 30.00
Lectures (FT) 24.00
Seminars (FT) 12.00

Assessment Methods

Component Duration Weighting Threshold Description
Course Work 01 n/a 60.00 45% Continuous Assessment 3 Multiple Choice Questions
Course Work 02 n/a 40.00 45% Essay - 2000 words