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Banking and regulation - Introduction

Banks play a key role as an intermediary in the financial system as they allow individuals to safely deposit their savings, provide loans to both individuals and organisations, and they are responsible for the payments system. This particular module discusses the role and function of the main financial institutions, including:Commercial Banks, Investment Banks, Insurance Companies, Management Investment Companies and Financial Brokerages.  The module discusses the role of the Central Bank and monetary policy.

The module also explores the different risks that are present in the financial markets, including: interest rate risk, liquidity risk, credit risk, operational risk, systematic or market risk, sovereign risk and capital adequacy. Lastly, the module discusses the need for Banking regulation and the Basel requirements (i, ii and iii).

The learning outcomes of the module are:

  • To understand the role financial institutions play in the economy
  • To understand the role of the central bank and monetary policy
  • To understand the different risks that are present in the financial market
  • To gain an understanding of Banking regulation and the Basel requirements

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