THE UNIVERSITY OF NORTH CAROLINA AT GREENSBORO
BRYAN SCHOOL OF BUSINESS AND ECONOMICS
FIN 330: Financial Institutions and Markets
Spring 2016
Instructor:
Classroom:
Office:
Phone:
Email:
Office Hours
Dr. Hunter An
BRYN 132 (T R 9:30-10:45 am)
Bryan Building, Room 322
(336) 334-3153
h_an@uncg.edu
Tuesday and Thursday: 10:45-11:45 a.m. and by appointments
PREREQUISITES: Grade of C or better in FIN 315
OVERALL COURSE OBJECTIVES:
This course is intended to help you understand the role of financial institutions and markets play in the business environment
that you will face in the future. It also helps you to develop a series of applications of principles from finance and economics
that explore the connection between financial markets, financial institutions and the economy. On the financial markets side,
we will learn the term structure of interest rates, stocks, principals of derivatives, and currencies. On the institutions side, we
will learn commercial banks, investment banks, insurance companies, mutual funds, the Federal Reserve Systems and their
role of in the economy.
LEARNING OUTCOME:
Upon Successful completion of this course, the student should be able to:
1. discuss theories that underneath the term structure of interest rates.
2. discuss efficient market hypothesis related to stock pricing.
3. understand a stylized bank’s balance sheet and discuss how risks are managed in banks.
4. discuss facts of the insurance business, mutual funds and investment banks.
5. grasp the basic features of options and futures and understand how financial institutions use them for risk management.
6. discuss the main functions of the Fed and tools they use to affect the economy.
7. know how currency value is determined the short run and long run.
8. know exchange rate system history, and the central bank intervention in the currency market, both unsterilized and
sterilized.
COURSE MATERIALS:
1.
Financial Markets and Institutions by Saunders and Cornett, published by McGraw-Hill, 6th edition, 2014.
Both the book and Connect Finance are required.
You can purchase both in a bundle: a hardcopy text and Connect Finance bundle (ISBN: 978-1259377273, available at
the UNCG bookstore);
Or purchase Connect Finance separately, which includes an E-text, when you register for Connect Finance online as
described below;
The ISBN for the hardcopy text is 978-0077861667 (book only).
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2. Connect Finance (required).
Each student must have access to McGraw-Hill’s Connect Finance product which you will be required to use to submit graded
homework assignments (Work competed with the courtesy access will be lost once the courtesy access expires). Student must
register for this course in Connect within 2 weeks after the semester starts.
To register for Connect Finance:
a.
Log in to Canvas first, and then go to this course FIN 330:
Click “Connect Finance” on the homepage, you will be directed to the Connect website. This is a unique
address for this class. Click on the “Register Now” button. You will likely be prompted to enter your e-mail
address.
If you are a new user, you will see two options:
1). Click to enter your access code (because you purchased Connect bundled with the bundle)
OR
2). Click to purchase access to Connect Finance online now because you didn’t purchase the text/Connect
Finance bundle.
b. Complete the registration form
c. Access your Connect homepage by clicking on “Go To Connect Now”
d. At your Connect homepage you can access your assignments, study center, grades, and other resources provided
by your instructor. Start by clicking any of the assignment titles displayed on the list.
e. Bookmark this URL to do Connect homework in the future without login to Canvas.
If you have trouble with registration, please contact Customer Support at http://mpss.mhhe.com/.
3. Financial Calculator (required). The recommended calculator for this course is the HP 10B II. Any calculator that is
capable of performing time value of money, amortization, net present value and internal rate of return calculations will be
sufficient. However, financial calculations will be taught with this calculator only. You are responsible for learning the
keystrokes of any other calculator. Please bring your financial calculator with you for every class.
4. Wall Street Journal (highly recommended). Student rate 15 weeks @ $15 ($1 per week, including the print paper 6
days a week, full access to WSJ.com, Smartphone and Tablet editions). Please visit
WSJ.com/studentoffer
IMPORTANT: Under School information use the following:
i. Zip code for school (us first 3) – 274
ii. School Name – click on UNC GREENSBORO
iii. Referring Professor – An, Hunter
5.
Syllabus and lecture PowerPoint slides are posted in Canvas.
PERFORMANCE EVALUATION:
1.
Homework: Homework accounts for 15% of your total grade. You need complete the homework assigned on
Connect Finance before the due date, and it will be graded. You can try unlimited times for each homework (before the final
exam date), and only the highest grade will be taken. There will be no extension of deadlines or make-up on graded
homework.
Doing homework consistently is an absolute must for success in this course. You will find the course much easier if you keep
up with the homework as it is assigned rather than leaving it all until a night or two before the test. I am a firm believer that
you “learn by doing”. Therefore, the course has been designed with assignments throughout the semester so that you are
motivated to keep.
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2.
Quizzes: Quizzes are given in class throughout the semester, and may not be announced in advance. Material
covered may include newly assigned material as well as recently discussed topics. Your lowest quiz will be dropped. There
will be no make-up for any missed quiz. The only accepted excuse of missing a quiz is attending UNCG sponsored activities,
in which case a hard letter from a faculty advisor must be provided.
3.
Exams: The exams will be based on homework questions, lectures and the textbook, and will consist of multiple
choice questions. Please purchase the scantron at the UNCG bookstore and bring them to the exam.
Exam 1: February 11 (Tentative)
Exam 2: March 3 (Tentative)
Exam 3: April 7 (Tentative)
Final exam: Thursday, May 3, 12–2:30 p.m.
Final exam is comprehensive. There are no makeup exams. In the event you miss an exam for medical circumstances, you
must notify me prior the scheduled exam and provide me with a note from a physician. I will determine whether to consider the
absence excused or unexcused and follow University policy. If the written verification is provided, the weight attributable to a
missed exam will be allocated to the comprehensive final exam. Exam questions will not be released to students after the exam.
GRADING:
All grade appeals must be in writing and submitted to me within one week of the time the grade is posted. No late appeals
will be considered. Adherence to the Academic Integrity Policy is expected and required of all students for all exams and
assignments. Failure to abide by this policy will result in disciplinary action. Details of the Academic Integrity Policy are
available at http://saf.dept.uncg.edu/studiscp/Manual.html.
Your grade will be determined based on the following:
Homework
Quizzes
Exams 1
Exams 2
Exams 3
Cumulative Final Exam
15%
15%
15%
15%
15%
25%
The grading scale is as follows:
A
AB+
B
BC+
C
CD+
D
DF
92% and above
90 – 91.99%
88 – 89.99%
82 -87.99%
80 – 81.99%
78 – 79.99%
72 – 77.99%
70 – 71.99%
68 – 69.99%
62 - 67.99%
60 – 61.99%
< 60%
ADMINISTRATIVE MATTERS:
a. Student Conduct: Students are expected to arriving for class on time, remaining in class for its duration, and doing
absolutely nothing during class that is disruptive or detracts from the learning experience of others. If a student is notified of
disruptive behaviors more than once, the overall course grade of the disruptive student will be reduced by one full letter
grade. If the conduct continues, the instructors reserve the right to ask the student to leave and drop any student disrupting
this class from the class. For an overview of specific University and Bryan School policies, please see the following links:
http://studentconduct.uncg.edu/policy/code/
www.uncg.edu/bae/faculty_student_guidelines.pdf
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b. Student Disabilities: All students with a disability requesting special services must go through the Office of Disabilities
Services. If you are requesting special accommodations, please bring your paper work from Disability Services directly to me
the first week of class. All such information will be held in confidence. The web link to this office is
http://ods.dept.uncg.edu/services/ .
c. No credit can be given for a dishonest assignment. At the discretion of the instructor, a student caught engaging in any
form of academic dishonesty may be:

Given a zero for that assignment.

Dropped from the course.

Failed in the course.

Dropped from the school.
Student Learning Goals – Finance Program
Each program within the Bryan school has separate learning goals as listed with the degree program. The Finance program has the
following learning goals:
1.
Finance students will be able to create forward-looking financial statements
2.
Finance students will be able to demonstrate the ability to utilize various financial measures to analyze the overall
financial health and operating efficiency of the firm.
3.
Finance students will be able to thoroughly understand the mathematic process and application of capital budgeting
4.
Finance students will thoroughly understand the concepts of the time value of money (TVM), the characteristics of
traditional financial securities, and the valuation of these securities.
FIN 330 emphasizes Student Learning Goal #4 through extensive coverage (qualitative and quantitative) of interest rates, duration,
immunization, and various bond and money market instruments. Upon successful completion of FIN 330, students will be able to
a.
Demonstrate how to find the present and future values of lump sums and annuities and solve for the time or interest
rate in TVM problems.
b.
Calculate periodic and effective interest rates,
c.
Identify important stock ownership rights, terms and how to value common and preferred stock.
d.
List the main classifications and characteristics of bond, calculate bond price and various bond yields, and explain the
importance of bond ratings and criteria for rating bonds.
TOPICS TO BE COVERED
PART 1 INTRODUCTION AND OVERVIEW OF FINANCIAL MARKETS
1 Introduction
2 Determination of Interest Rates
3 Interest Rates and Security Valuation (plus duration model and immunization in Chapter 22)
4 The Federal Reserve System, Monetary Policy, and Interest Rates
PART 2 SECURITIES MARKETS
5 Money Markets
6 Bond Markets
8 Stock Markets
PART 3 COMMERCIAL BANKS
11 Commercial Banks: Industry Overview
12 Commercial Banks' Financial Statements and Analysis
13 Regulation of Commercial Banks
PART 4 OTHER FINANCIAL INSTITUTIONS*
15 Insurance Companies
16 Securities Firms and Investment Banks
17 Mutual Funds and Hedge Funds
18 Pension Funds
* If time permits
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