POST GRADUATE PROGRAMME IN MANAGEMENT
AY 2023-2024
TERM: III
TITLE OF THE COURSE: Financial Institutions and Markets
CREDITS: 4
Name of the
instructor
Prof. Debasish
Maitra
Prof. Udayan
Sharma
Sections: 4
Room
No.
J block
Email
Extn. No.
Consultation time
debasishm@iimidr.ac.in
2439484
A-113
udayans@iimidr.ac.in
2439589
Weekdays (4 to
4.30 pm)
-
Number of
Sections
2
2
COURSE DESCRIPTION
Functioning of economy and markets heavily relies on financial institutions (FIs) and markets.
Financial institutions and markets play a crucial and integral role in running the economy with
subject to the strict regulations. Financial institutions are at the heart of any economy’s financial
system. They play crucial roles in channelizing funds to the borrowers and managing our savings,
as well as providing protections during any exigency. However, in today’s world banking and
insurance industry and some of its business activities cannot be compartmented from other ‘nonbanking financial institutions’. The growing linkage between finance, and IT and IT-enabled
services has fostered the development of financial products and their transactions. The integration
of economies across the world in the globalization era raises the importance to study financial
institutions and markets.
COURSE OBJECTIVES
The course is intended to deliver the following objectives;
Understanding the concepts, basic tenets and the role of financial institutions
To understand the classroom concepts through simulation game
Recognizing the issues of regulatory compliances
To know the concepts and structure of financial markets
To experience practical exposure to various financial products and markets
PEDAGOGY/TEACHING METHOD
The course employs chapters of the books, various articles as the means to link the theory with
practices. Every theoretical session will be followed by problem-solving exercises to appreciate the
concepts. Data sets for the hands-on exercises are to be provided in a time to time manner. In the
middle of sessions on banking, a simulation game will be introduced to connect classroom
discussion with the practice. One session of guest lecture by industry personnel may be arranged
to provide practitioner’s view
EVALUATION:
Individual Component
Quiz
Comprehensive End Term
Group Component
Project submission or Presentation
Simulation
Class Participation
Total
Weightage
10%
40%
20%
10%
20%
100%
ACADEMIC DISHONESTY:
IIM Indore believes in Academic honesty. Academic dishonesty or misconduct is cheating that
relates to an academic activity. It is a violation of trust between the Institute and its stakeholders.
Plagiarism, fabrication, deception, cheating and sabotage are examples of unacceptable academic
conduct. Please consult the Programme manual for the section on academic dishonesty.
SCHEDULE OF SESSIONS
MODULE 1: Commercial Banks, Non-Banking Financial Companies and Insurance Companies
Module Objective: To review the basic question on the existence of a bank, NBFCs and insurance
companies in any economy. The objective is to make participants aware about the economics of
banking, organization and structure of banks, and role of regulations
SESSIONS AND OBJECTIVE
Commercial Banks
Session 1:
Understanding the structure and overview of banks
Objective:
Readings:
• Rose C and Waggoner S (2010), Note on the Banking Industry, HBS No.9311-011, 1-16, Boston, MA: Harvard Business School Publishing
• Frei F and Campbell D (2006), Economics of Retail Banking Note, HBS No.
9-602-153, 1-13, Boston, MA: Harvard Business School Publishing
Kumta . G., and Kamat, V. (2012), Growth Strategies at SVC Bank, Ivey cases
Case:
(9B12M068), 1-13, Ontario: Richard Ivey School of Business Foundation, 113.
Regulations
Session 2:
Understanding the role of central bank, regulations and the nuances of
Objective:
BASEL-III. Various functions of RBI would be discussed in the class using
Monetary Policy Statement published by RBI.
Blaylock D (2011), BASEL-III: An Evaluation of New Banking Regulations, IVEY
Reading:
no. 910n29, 1-15, Ontario: Richard Ivey School of Business Foundation
Session 3, 4& 5: Financial Statements of Banks
To know the structure of the financial statements of a bank and how they
Objective:
are analysed.
Bank Management and Financial Services: Ch 5 & 6
Reading:
Maitra D and Banerjee P (2016), United Bank of India: Present Fiasco and
Case:
Future Plans, Ivey No. 9B15N028, 1-15, Ontario: Richard Ivey School of
Session 6
Session 7-8
Case
Objective:
Session 9-10:
Objective:
Case:
Session 11-12:
Objective:
Reading:
Exercise:
Business Foundation
Introduction of Simulation
Bank valuation
Federal Bank: Dividend Discount Valuation, HBS: W17123-PDF-ENG, 1-10,
Harvard Business School Publishing
To know the discount based valuation for banks
Non-Banking Financial Companies (NBFCs)
Understanding the structure and overview of NBFCs
Jagadale S and Maitra D (2014), Bandhan Microfinance: Was the
Transformation to Bank Required? Ivey: 9B14N019, 1-19, Ontario: Richard
Ivey School of Business Foundation
Insurance Companies
Understanding the structure and overview of insurance companies
Financial Institutions and Markets, Chapter-11
Financial statement analysis of an insurance company
MODULE 2: Financial Markets
Module Objective: To understand the characteristics and operational nuances of financial
markets.
SESSIONS AND OBJECTIVE
Session 13-14:
Objective:
Reading:
Case:
Session 15-16
Objective:
Reading:
Case:
Session 17-18
Objective:
Reading:
Case:
Session 19-20
Objective:
Reading:
Case:
Mutual Funds, Hedge Funds, Forex and commodities
To understand and identify key concepts related to mutual funds, hedge
funds, foreign exchange and commodities.
Financial Institutions and Markets, Chapter-12 & 21
Measuring Mutual Fund Performance, HBS: 298139-PDF-ENG, Harvard
Business School Publishing
Amaranth Advisors: Burning Six Billion in Thirty Days, HBS: 908N03-PDF-ENG,
Harvard Business School Publishing
Bond and Debt markets
To understand the concepts and features bond/debt markets, structure of
interest rates in India, and short-term money markets
Financial Institutions and Markets, Chapter-15, 16, and 18
HAG's Singapore Note Issue, HBS: W13368-PDF-ENG, 1-13, Harvard Business
School Publishing
Stock markets
To know the role and functioning of equity markets. To understand the key
features of primary and secondary markets.
Financial Institutions and Markets, Chapter-19
Lululemon Athletica: Pitching an IPO, Ivey: 8B11N012, 1-14, Ontario: Richard
Ivey School of Business Foundation
Derivatives markets
To know the concepts, different types and the prospects and policy of
financial and commodity derivatives
Financial Institutions and Markets, Chapter-20
Lufthansa: To Hedge or Not to Hedge, HBS: 900N22-PDF-ENG, 1-3, Harvard
Business School Publishing
Please indicate the changes made in the course outline based on the measurement of assurance of
learning (closing the loop)/student feedback:
Please give the details of the book if students need to buy the book:
Author
Title
Publisher Edition
Peter Rose and Sylvia
Hudgins
Bank Management and
Financial Services
Tata
McGraw
9th Edition
L M Bhole and Jitendra
Mahakud
Financial Institutions
and Markets
McGraw
Hill
6th Edition
Remarks, if
any
ADDITIONAL READINGS/ REFERENCE BOOK:
•
•
•
Management of Banking and Financial Services-2nd Edition, Author- Padmalatha Suresh
and Justin Paul, Publisher-Pearson India.
Financial Markets and Institutions: An Introduction to the Risk Management Approach ,
Author-Anthony Saunders, McGraw-Hill, India Edition (3rd)
Financial Markets and Institutions, Author-Jeff Madura, Cengage Learning, 10th Edition
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