Capital Markets and Financial Institutions
Purpose of this Course
This course consists of two major parts. The first part is devoted to the nature, role, and functioning of financial institutions in the developed capital markets. The main goal of this part is to introduce the theoretical background on which the practices of operation of financial markets and institutions are based as well as to discuss practical operations of financial institutions (banks, investment companies, brokers etc.)
The second part deals with the Russian capital markets and financial institutions. The principal goal here is to screen the local experience against worldwide theory and practices in order to identify both common and specific features of developed and emerging markets.
Another goal of the course as a whole is to expose the students to the Western standards, approaches, and terminology used in capital markets and financial institutions worldwide.
Notes, handouts, articles, and cases from the course package.
Grading of this course will be based on assignments, examinations and class participation.
Because the course is heavily discussion-based attendance is mandatory. Failure to attend 40% of classes leads to immediate failure in the course and loss of credit.
During the course the students will have to submit 4 homeworks, 1 final case write-up, and take the midterm examination. Failure to pass the midterm exam or to hand in the final case report leads to failure in the course.
The course will be graded in accordance with the following schedule:
- Introduction: Financial intermediation in capital markets
- Problems caused by private information
- The role of financial intermediaries (I) — Monitoring and covenant enforcement: asset services
- The role of financial intermediaries (II) — Illiquid assets and the creation of liquidity: transformation services
- Deposit insurance and regulation — The need in and the views on deposit insurance
- Deposit insurance and regulation — Bank regulation and reform
- Investment banking
- Market microstructure — Market making and market crashes
- Foundations and history of the russian capital markets
- The russian fixed income market
- The russian stock market (I) — Fundamental issues
- The russian stock market (II) — Risk and return
- Corporate finance in russia — An overview
You can download description of the course here.