FINC 2020 - Bank & Lending Management

Credit Hours: 3.00
(3 contact hrs)
FINC-2020 introduces students to the banking and financial-services industry (FSI). Emphasis is on an overview of the industry, assessment of risk factors, business and commercial real estate lending. The theory and objectives of bank regulation, bank failures, and ethics specific to FSI are explored. This course is offered once per academic year.

Prerequisites:
Prerequisite: FINC-1010

OUTCOMES AND OBJECTIVES
Outcome 1: Upon completion of this course, students will be able to summarize bank financial management in the financial-services industry.

Objectives:

Explain the functions of banking and the financial‐services industry.
Identify the sources and uses of bank funds.
Identify the risks of banking.
Distinguish between economic values and accounting numbers.
Explain the role of regulation.

Outcome 2: Upon completion of this course, students will be able to assess performance in the financial‐services industry.

Objectives:

Assess strategic financial management.
Measure bank performance using accounting models.
Measure bank performance using economic models.
Distinguish between bank corporate strategy and strategic planning in the financial‐services industry.
Calculate Economic Value Added (EVA) as a means to measure performance.

Outcome 3: Upon completion of this course, students will be able to differentiate between portfolio and credit risk.

Objectives:

Identify the five “C’s” of creditworthiness.
Calculate credit risk using a bank’s Risk Index (RI).
Calculate the expected cash flow from a loan.
Calculate the default probability of a loan.
Calculate a loan’s recovery factor.

Outcome 4: Upon completion of this course, students will be able to explain the role of regulation, deposit insurance, and ethics in the banking and financial‐services industry.

Objectives:

Determine the why, what, how, and for whom the bank and financial‐service industry is regulated.
Describe the principal‐agent model.
Determine the purpose, structure, and regulation of bank holding companies.
Discuss the moral hazard and cost of government guarantees.
Identify the causes of bank failures.
Determine unethical behavior in banking and what constitutes fraud in the FSI.

COMMON DEGREE OUTCOMES
(Bulleted outcomes apply to the course)

1. The graduate can integrate the knowledge and technological skills necessary to be a successful learner.

2. The graduate can demonstrate how to think competently.

3. The graduate can demonstrate how to employ mathematical knowledge.

4. The graduate can demonstrate how to communicate competently.

The graduate is sensitive to issues relating to a diverse, global society.

COURSE CONTENT OUTLINE

Introduction to Bank Financial Management in the Financial Services Industry (FSI)
1. Overview of Banking and the Financial Services Industry
2. Sources and Uses of Bank Funds and the Risks of Banking
Strategic and Financial Management and the Measurement of Bank Performance
1. Accounting and Economic Models of Bank Value and Performance
2. Managing Value and Risk: Bank Corporate Strategy and Strategic Planning in the Financial Services Industry
The Portfolio Risks of Banking and their Management: Theory and Practice
1. Credit Risk and the Lending Function
Managing the Bank Lending Function
1. Management of Credit Risk: Business Lending
2. Consumer Lending
3. Commercial Real Estate Lending
The Roles of Regulation, Deposit Insurance, and Ethics in Shaping Banking and the Financial Services Industry
1. The Theory, Objectives, and Agencies of Bank Regulation
2. Deposit Insurance, Bank Failures, and the Savings‐and‐Loan Mess
3. Ethics in Banking and the Financial Services Industry (FSI)

Primary Faculty
Newman, Brian
Secondary Faculty
Jex, Fred
Associate Dean
Evans-Mach, Patrick

Official Course Syllabus - Macomb Community College, 14500 E 12 Mile Road, Warren, MI 48088