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KS Banking:
Course Goals
This course aims to provide a broad introduction to bank management and the economics of banking. Students shall acquire basic knowledge about key performance indicators, measures of competitive behavior, bank efficiency evaluation, and credit risk assessment. Students also learn which data and methods are used in different fields of bank analytics (perfomance, competition, efficiency, customer default prediction). This shall enable them to follow the academic literature on banking topics and to start related own empirical work.
Course Content
- Theory of financial intermediation, functions of banks and other financial intermediaries.
- Introduction to various important fields of bank management.
- Bank competition and measurement of competitive behavior.
- Performance analysis and assessment of banking efficiency.
- Fundamentals of credit risk evaluation and default prediction.
Course Objectives
- Introduce students to the economic functions of banks and the theory of financial intermediation.
- Outline the different types of banks, their various business activities, the structure of the Austrian banking market, the rationale for bank regulation, and the reasons for bank mergers as well as their consequences.
- Discuss different approaches to the assessment of competition in banking markets, as well as the merits and deficiencies of numerous indicators (measures derived from market structures versus measures of bank conduct).
- Explain different concepts of efficiency, simple accounting measures applied in productivity and efficiency assessments, and frontier methods used in performance benchmarking.
- Introduce students to (the methods used in) credit risk assessment and customer default prediction.
Enhance understanding by discussing empirical applications of textbook issues (per selected academic papers) and prompting students’ own research. For the latter, a list of questions and exercises on issues related to the course contents is provided.
Methodes of Teaching and Learning
Despite being primarily designed as a classic lecture, the course also uses participatory activities to uphold student attention and motivation, and to foster the attainment of intended learning outcomes:
- Lecture, supported by slides.
- For some topics, textbook reading and studying other academic literature is required in advance. This shall prepare students to participate in informed discussions in the form of a flipped classroom.
- Inquiry-based learning per individual homework questions. Students’ answers and solutions may be presented and discussed in class.
- Project-based learning per individual homework exercises. Solutions and results may be presented and discussed in class.
- Lectures are partly interactive, with students developing solutions to problems and exercises in class, followed by (directed) discussion. Some of those sessions may be arranged as group work, thus offering cooperative learning.
Criteria for Evaluation (Assessment Strategy)
Exam and homework exercices
