BANK3012: Semester 2, 2023

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Units BANK3012 Semester 2 2023 [Normal day]

Unit of study_

BANK3012: Bank Supervision

Semester 2, 2023 [Normal day] - Camperdown/Darlington, Sydney

Overview

This unit provides undergraduate students with knowledge and a greater understanding of the central issues and principles underpinning recent developments in the global regulation and supervision of banking/financial institutions. The concept of financial stability as the goal of public policy and the rationale for prudential regulation and supervision of banks is discussed first. Students are then exposed to a range of concepts and issues pertaining to the measurement, management and prudential regulation of key risks in banking (i.e. market risk, credit risk, operational risk, liquidity risk). Other elements in the unit entail discussion and examination of issues relating to the concept of capital adequacy and risk-based capital ratios with particular reference to Basel Capital Accords; the Basel Core Principles for Effective Banking Supervision; different national approaches to regulation and supervision of banks; government financial safety nets (i.e.'Lender of Last Resort' and depositor protection schemes); post-crisis structural banking reform proposals.

Unit details and rules

Unit code	BANK3012
Academic unit	Finance
Credit points	6
Prohibitions ?	None
Prerequisites ?	BANK2011 or ECOS2004 or FINC2011
Corequisites ?	None
Assumed knowledge ?	BANK3011
Available to study abroad and exchange students	No

Teaching staff

Coordinator	George Issa, george.issa@sydney.edu.au
Lecturer(s)	George Issa, george.issa@sydney.edu.au

Type	Description	Weight	Due	Length
Supervised exam ?	Final exam Closed book exam	50%	Formal exam period	2 hours
Outcomes assessed:
Assignment	Individual Assignment Analysis of recent banking supervision issue	20%	Week 07 Due date: 11 Sep 2023 at 23:59	1,000 words
Outcomes assessed:
Assignment	Group oral presentation Prepare and present a slide presentation	30%	Week 11 Due date: 16 Oct 2023 at 23:59	15-pages + 10 minute oral presentation
Outcomes assessed:
= group assignment ?

Assessment summary

Group Project: Students are required to deliver an oral presentation (supported by a PowerPoint presentation) on an assigned topic.
Individual Assignment: Students are required to individually analyse a contemporary banking issue.
Final Exam: The final exam covers the entire content of the unit. It is a closed book exam comprised of both quantitative and qualitative questions.

Detailed information for each assessment will be provided in lectures and posted on Canvas.

Assessment criteria

The University awards common result grades, set out in the Coursework Policy 2014 (Schedule 1).

As a general guide, a high distinction indicates work of an exceptional standard, a distinction a very high standard, a credit a good standard, and a pass an acceptable standard.

Result name	Mark range	Description
High distinction	85 - 100	Awarded when you demonstrate the learning outcomes for the unit at an exceptional standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Distinction	75 - 84	Awarded when you demonstrate the learning outcomes for the unit at a very high standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Credit	65 - 74	Awarded when you demonstrate the learning outcomes for the unit at a good standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Pass	50 - 64	Awarded when you demonstrate the learning outcomes for the unit at an acceptable standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Fail	0 - 49	When you don’t meet the learning outcomes of the unit to a satisfactory standard.

For more information see sydney.edu.au/students/guide-to-grades.

For more information see guide to grades.

Late submission

In accordance with University policy, these penalties apply when written work is submitted after 11:59pm on the due date:

Deduction of 5% of the maximum mark for each calendar day after the due date.
After ten calendar days late, a mark of zero will be awarded.

Academic integrity

The Current Student website provides information on academic integrity and the resources available to all students. The University expects students and staff to act ethically and honestly and will treat all allegations of academic integrity breaches seriously.

We use similarity detection software to detect potential instances of plagiarism or other forms of academic integrity breach. If such matches indicate evidence of plagiarism or other forms of academic integrity breaches, your teacher is required to report your work for further investigation.

You may only use artificial intelligence and writing assistance tools in assessment tasks if you are permitted to by your unit coordinator, and if you do use them, you must also acknowledge this in your work, either in a footnote or an acknowledgement section.

Studiosity is permitted for postgraduate units unless otherwise indicated by the unit coordinator. The use of this service must be acknowledged in your submission.

Learning support

Simple extensions

If you encounter a problem submitting your work on time, you may be able to apply for an extension of five calendar days through a simple extension.  The application process will be different depending on the type of assessment and extensions cannot be granted for some assessment types like exams.

Special consideration

If exceptional circumstances mean you can’t complete an assessment, you need consideration for a longer period of time, or if you have essential commitments which impact your performance in an assessment, you may be eligible for special consideration or special arrangements.

Special consideration applications will not be affected by a simple extension application.

Using AI responsibly

Co-created with students, AI in Education includes lots of helpful examples of how students use generative AI tools to support their learning. It explains how generative AI works, the different tools available and how to use them responsibly and productively.

Weekly schedule

WK	Topic	Learning activity
Week 01	1. Course administration; 2. Introduction to bank supervision	Lecture and tutorial (3 hr)
Week 02	1. Principles of bank supervision; 2. Regulatory models (Australia + US)	Lecture and tutorial (3 hr)
Week 03	1. Financial crises and regulation (the Great Depression and the GFC)	Lecture and tutorial (3 hr)
Week 04	1. The Banking Royal Commission; 2. Australia's BEAR	Lecture and tutorial (3 hr)
Week 05	1. International bank supervision (the Basel Accords)	Lecture and tutorial (3 hr)
Week 06	1. Conduct risk (what it is and how it is measured and regulated in Australia)	Lecture and tutorial (3 hr)
Week 07	1. Operational risk (what it is and how it is measured and regulated in Australia)	Lecture and tutorial (3 hr)
Week 08	1. Credit risk (what it is and how it is measured and regulated in Australia)	Lecture and tutorial (3 hr)
Week 10	1. Market risk (what it is and how it is measured and regulated in Australia)	Lecture and tutorial (3 hr)
Week 11	1. Liquidity risk (what it is and how it is measured and regulated in Australia)	Lecture and tutorial (3 hr)
Week 12	1. Group project presentations (Week 1)	Presentation (3 hr)
Week 13	1. Group project presentations (Week 2)	Presentation (3 hr)

Attendance and class requirements

Students are expected to attend and participate in all classes including lectures and tutorials.

Study commitment

Typically, there is a minimum expectation of 1.5-2 hours of student effort per week per credit point for units of study offered over a full semester. For a 6 credit point unit, this equates to roughly 120-150 hours of student effort in total.

Required readings

All readings for this unit can be accessed via the Modules in Canvas.

The following text is frequently referenced and is recommended as a supplement to the lecture notes. It is available through the Library eReserve system (on the Canvas unit site):

Foundations of Financial Risk: An Overview of Financial Risk and Risk Based Financial Regulation, 2nd Edition, Wiley Finance Series, 2015, Richard Apostolik, Christopher Donohue.

Learning outcomes

Learning outcomes are what students know, understand and are able to do on completion of a unit of study. They are aligned with the University's graduate qualities and are assessed as part of the curriculum.

Outcomes
Graduate qualities

At the completion of this unit, you should be able to:

LO1. Discuss and explain the rationale for bank regulation and supervision, and why such regulatory/supervisory efforts need to be undertaken within a global context.
LO2. Explain the core principles of effective banking supervision and how such principles can be applied to assess a country’s supervisory and regulatory regime.
LO3. Identify and explain the importance of bank culture and conduct, and why regulators have increasingly prioritised these risks.
LO4. Identify the principal risks encountered by the banking industry and explain why they attract regulatory scrutiny; clearly articulate how the effective management of these risks is central to the performance and viability of banks and financial institutions.
LO5. Explain the role of capital adequacy requirements, and describe the regulatory requirements set out by the Bank of International Settlements in its capital accords.
LO6. Explain how banks measure, model and manage their market, credit, operational, liquidity, and conduct risks, and assess regulatory/supervisory perspectives on the effective management and supervision of these risks.

Graduate qualities

The graduate qualities are the qualities and skills that all University of Sydney graduates must demonstrate on successful completion of an award course. As a future Sydney graduate, the set of qualities have been designed to equip you for the contemporary world.

GQ1	Depth of disciplinary expertise Deep disciplinary expertise is the ability to integrate and rigorously apply knowledge, understanding and skills of a recognised discipline defined by scholarly activity, as well as familiarity with evolving practice of the discipline.
GQ2	Critical thinking and problem solving Critical thinking and problem solving are the questioning of ideas, evidence and assumptions in order to propose and evaluate hypotheses or alternative arguments before formulating a conclusion or a solution to an identified problem.
GQ3	Oral and written communication Effective communication, in both oral and written form, is the clear exchange of meaning in a manner that is appropriate to audience and context.
GQ4	Information and digital literacy Information and digital literacy is the ability to locate, interpret, evaluate, manage, adapt, integrate, create and convey information using appropriate resources, tools and strategies.
GQ5	Inventiveness Generating novel ideas and solutions.
GQ6	Cultural competence Cultural Competence is the ability to actively, ethically, respectfully, and successfully engage across and between cultures. In the Australian context, this includes and celebrates Aboriginal and Torres Strait Islander cultures, knowledge systems, and a mature understanding of contemporary issues.
GQ7	Interdisciplinary effectiveness Interdisciplinary effectiveness is the integration and synthesis of multiple viewpoints and practices, working effectively across disciplinary boundaries.
GQ8	Integrated professional, ethical, and personal identity An integrated professional, ethical and personal identity is understanding the interaction between one’s personal and professional selves in an ethical context.
GQ9	Influence Engaging others in a process, idea or vision.

Outcome map

Learning outcomes	Graduate qualities
Learning outcomes

Responding to student feedback

This section outlines changes made to this unit following staff and student reviews.

There have been several changes in both the content and delivery since this course was last offered, including assessment.

Additional information

Disclaimer

The University reserves the right to amend units of study or no longer offer certain units, including where there are low enrolment numbers.

To help you understand common terms that we use at the University, we offer an online glossary.

Current students

Overview

Overview

Unit details and rules

Teaching staff

Assessment

Assessment

Assessment summary

Assessment criteria

Late submission

Academic integrity

Learning support

Learning support

Simple extensions

Special consideration

Using AI responsibly

Weekly schedule

Weekly schedule

Attendance and class requirements

Study commitment

Required readings

Learning outcomes

Learning outcomes

Graduate qualities

Outcome map

Responding to student feedback

Responding to student feedback

Additional information

Additional information

Disclaimer

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