North South University School of Business BBA Program (Fall2011)

Course Title : Bank Management (FIN 464) Instructor : M. Morshed, Senior Lecturer, School of Business Office Room : NAC 763 Office Hours: TBA Telephone : 8852000. Ext. 1708 (office) E-mail : mmorshed@northsouth.edu Course Descriptions This course has a somewhat more practical orientation than many other courses in the business program, focusing as it does on the microeconomic problems of financial management of banking firms. This does not mean, however, that the course is devoid of theoretical interest. The course builds on theories and models covered elsewhere in the program; particularly those detailed in the course of Banking and Finance. It also raises some new theoretical problems for consideration, many of them concerned with the way we need to conceptualize the banking firm. Course Objectives This course examines the role and importance of bank financial management to the modern bank. It teaches the basic models of financial management taught by University Economics Departments and Business Schools, which were constructed from the experience of mature capitalist economies. The course discusses the various trends shaping banking markets, such as institutionalization, securitization, globalization and concentration. Among its aims are the following To set the banking firm in the context of a changing financial services industry To look at the role of the financial manager within the banking firm To examine bank capital and capital structure, and to consider the question of the adequate regulation of the banking sector to ensure its safety, to preserve bank liquidity and prevent bank failures. Suggested Readings

Peter S. Rose & Sylvia C. Hudgins, Bank Management & Financial Services,
8th edition, 2008, McGraw-Hill publications. Timothy Koch and S Scott MacDonald, Bank Management, Fourth Edition, 2000, Dryden Press, ISBN0030244021. George H. Hempel & Donald G. Simonson, Bank Management: Text & Cases, 5th edition, Prentice Hall Publication. R. A. Howlader & Syed Ashraf Ali, Banking Law and Practice, Revised Edition, 2007-8, Mowla Brothers.

Course Outline Chapters Contents Lec. # Chapter AN OVERVIEW OF BANKS & THEIR SERVICES: What is a Bank? The One (1) Services banks offer to the public; Trends affecting all banks. (1 & 2) Chapter IMPACT OF GOVERNMENT POLICY & REGULATION ON BANKING: (3 & 4) Two (2) Reasons behind the regulations, Central Bank & monetary policies. Chapter THE ORGANIZATION & STRUCTURE OF BANKS & THEIR INDUSTRY: (5 & 6) Three (3) Differences between large & small banks organization charts; Unit Banking; Branch Banking; Bank Holding Company Organization; Networking; Reasons behind the expansion of interstate banking system. Chapter ESHTABLISHING NEW BANKS, BRANCHES, ATMs, TELEPHONE (7 & 8) Four (4) SERVICES And WEB SITES: Establishing full-service branch offices choosing locations, designing new branches. New trends & technology. Chapter THE FINANCIAL STATEMENT OF BANK: Bank Assets; Bank Liabilities; (9 & 10) Five (5) Off-Balance-Sheet Items; Components of the Income Statement; Other useful Bank Financial Statement. Chapter MEASURING & EVALUATING BANK PERFORMANCE: Evaluating a (11, 12 & Six (6) banks performance; Measuring Risk in banking; The impact of size, location 13) & regulatory bias in analyzing bank performance. Chapter ASSET LIABILITY MANAGEMENT-DETERMINING & MEASURING (14 & 15) Seven (7) INTEREST RATES: Asset-liability management strategy; Interest rate risk factors, measurement, components. Chapter THE INVESTMENT FUNCTION IN BANKING: Functions of a banks (16, 17) Ten (10) Security Portfolio- Money Market Instruments; Capital Market Instruments; Other Investment Instruments developed more recently; Factors affecting the bankers choice among investment securities; Investment Maturity Strategies. Chapter LIQUIDITY & RESERVE MANAGEMENT STRATEGIES & POLICIES: The (18) Eleven demand for & supply of liquidity; Why banks face significant liquidity (11) problems? Strategies for liquidity Managers; Estimating a banks liquidity needs; Factors in choosing among the different sources of reserve. Chapter MANAGEMENT OF CAPITAL: Banks capital & Risk; Banks defenses (19 & 20) Fifteen against risk; Types of bank capital; Relative importance of the sources of (15) bank capital; Measuring the size of bank capital; How much capital does a bank need? Current pressure to raise more capital; Planning to meet a banks capital needs. Chapter BANK LENDING- POLICIES & PROCEDURES: Types of loans made by (21 & 22) Sixteen banks; Regulation of lending; Establishing a Written Loan policy; Steps in (16) the lending process; Credit Analysis: What makes a good loan; Sources of information about loan customers; Parts of a typical loan agreement. Chapter LENDING TO BUSINESS FIRM: Types of Business loans: Analyzing (23 & 24) Seventeen business loan applications; Financial ratio analysis of a customers financial (17) statements; The Financial Leverage Factor as a Barometer of a business firms capital structure.

Important Note This course outline is tentative and the instructor has the right to modify it depending on the class schedule and the performance of the class. Exam Schedule Exam Exam Date Mid-Term 1 TBA Mid-Term 2 TBA Final Exam TBA Syllabus for Exams Exam Mid-Term 1 Mid-Term 2 Final Exam (Tentative Syllabus) Syllabus Chapter 1,2,3,4 Chapter 5,6,7 Chapter 10,11,15,16,17

Term Paper: Term paper plays a key role for exam preparation. This must be submitted in time. Late submission of term paper will not be entertained. Students have to submit computer printouts. Marks Allocation Class Attendance Quiz Term Paper Midterm 1 Midterm 2 Final Exam : : : : : : 5% 10% 15% 20% 20% 30% 100%

Grading Policy Students will be graded as per university grading policy. Important Instructions Students are required to bring textbook to every class. Students are not allowed to switch sections in between. Students cannot share anything during the exams/quizzes. There will be no make-up exam/quiz in this course. If any body fails to sit for any exam, s/he can sit for comprehensive exam in the next exam. Students need to know how to use word processing packages and spreadsheet software. University rules will be applied regarding using unfair and unethical means (including cheating, plagiarism) during exams/quizzes. Cell phones must be switched off during classes and exams. Incomplete (I) will be given in the case where the student misses the final exam due to unavoidable circumstances. But the students should inform the instructor before submitting the grade. Any kind of threat and pressure will not be tolerated. Severe action will be taken in that case.

********Good Luck***********