The Financial Crisis and International Financial Regulation

Course Code

FINREG823

Program or Programs for which course is part

Master in Real Estate (MRE) Executive Master in Real Estate (E-MRE) Master in Real Estate and Finance (MRE(Fin)) Executive Master in Real Estate and Finance (E-MRE(Fin)) Master in Real Estate and Finance (MRE (Fin)) Semester Abroad Master in Real Estate and International Business (MRE-Int.Bus) Master in Real Estate and Marketing (MRE-Mkt) Master in Real Estate and Project Management (MRE-PM)

Level (I, H, or M)

M

Number of Credits

This course carries a weight of 20 credits of the Homburg Academy, which is equal to 10 ECTS (European Credit Transfer System credits).

Learning Time This course requires approximately 200 hours of learning time. This includes all taught and supervised classes and all private study and research.

Stage (I or II, where applicable)

Stage I

Is this Course Core, Specialist or Elective

Core for the MRE-Int.Bus Elective for MRE, E-MRE, MRE(Fin), and E-MRE(Fin). MRE(PM), and MRE(Mkt)

Courses that are pre-requisite or co-requisite

None

Name of Course Convenor

Dr Michael Taylor

Position

Adjunct Professor

Email address

michaeltaylor@cbb.gov.bh

Brief Course Summary The latest international financial crisis is the most severe in recent decades, but it is not the first and it is unlikely to be the last. This course examines the financial crisis within the history of evolving structures for global financial governance. Dr Taylor, co-author of a successful recent book on international finance and banking regulation, leads students through a consideration of:

The changing nature of banks

Panics, bank runs, and coordination problems

Collapsing dominoes and asset price spirals

The Financial safety net and moral hazard

Sources of financial regulation

Bank licensing and corporate governance

The rationale for bank capital regulation

The new capital adequacy framework: Basel II

Consolidated supervision of financial conglomerates

Bank insolvency

Regulation after the global financial crisis

Course Objectives The intended learning outcomes of this course are as follows:

To provide students with an appreciation of the global nature of finance, and the causes of recent financial crises;

To equip students with a thorough knowledge of international finance and risk that will be useful for the international real estate professional;

To understand and appreciate the sources, extent, and limits, of international banking and financial regulation.

These specific learning outcomes contribute to achieving the learning outcomes of the relevant programs by demonstrating knowledge of the following (mapped to the Program Specification): A. Advanced knowledge and understanding of: 12.A.4: The general theoretical and conceptual frameworks in the field of real estate appraisal and how these are applied in the analysis of specific issues, exercising critical judgement and reason in each case; 12.A.5: How to carry out an independent research project and write in a scholarly manner demonstrating familiarity with academic conventions in the preparation of the student’s case study report.

B. Intellectual skills: 12.B.1: Develop general research skills, especially bibliographic and computing skills in finding, selecting, and analysing materials for the independent project; 12.B.2: Learn to gather, organise and deploy evidence, data and information from a variety of secondary and some primary sources; 12.B.4: Learn to identify, investigate, analyse, formulate and advocate solutions to problems; 12.B.5: Develop problem solving skills, including the ability to identify and define problems, and to establish strategies for dealing with them including criteria for success, mapping optimum and alternative solutions, and exercising critical judgement to discriminate between the ranges of alternatives; 12.B.6: Synthesise relevant information and exercise critical judgement in the development of reasoned arguments; 12.B.7: Enable students to reflect upon and manage their own learning, and seek to make use of constructive feedback from staff and peers to enhance their performance and personal skills. C. Subject-Specific Skills 12.C.3: Be able to discriminate between forms of knowledge and be able to draw selectively and appropriately on them;

D. Transferable skills: 12.D.1: Develop autonomy in learning, work independently demonstrating initiative and self organisation; 12.D.2:. Work co-operatively on group tasks, understand how groups function, collaborate with others and contribute effectively to the achievement of common goals; 12.D.3: Use communication and information technology for the retrieval and presentation of information, in the form of prose or numeracy as appropriate; 12.D.4: Develop communication skills, both orally and in writing. Communicate clear, succinct, analytical ideas; 12.D.5: Prepare and deliver oral presentations individually and as part of a group.

List of Lecture Topics

1. Developments in banking and finance 1971-2011 2. Causes of financial crises 3. What makes banks special? 4. Setting global standards for banks 5. Regulation and corporate governance 6. Bank capital requirements 7. Bank capital requirements (2) 8. Limits on bank risk taking 9. Regulation and real estate lending 10. Financial regulation after the Global Financial Crisis

Learning and Teaching Methods Achievement of learning outcomes: the learning outcomes for this course are achieved through student participation in lectures (compulsory), in their active participation in seminars (compulsory), and in their fulfilment of the assessed elements (compulsory). This is a ten week course that is offered entirely online. In each week there is a lecture presentation for approximately one hour, plus an interactive seminar discussion for approximately one hour. Lecture presentations are led by the course professor. The lectures are designed to introduce key theories, practices, and methods, and to guide students through an understanding of their rationale, their uses, and their limitations, so that students may both understand and reflect critically upon the issues. The lectures contribute to the achievement of learning outcomes by guiding students through the main theories, concepts, and debates in the scholarly literature, as well as the contested concepts and methods. Seminar Discussions are led by students under guidance of the course professor. The seminar is the opportunity for students to gain clarification of the lecture material and the reading materials. Also, through these guided discussions, it is intended that students will gain a comprehensive understanding by linking lectures, independent reading and class discussion, enabling students to apply concepts, theories, and methods to the analysis of specific issues. Through dialogue, interaction, cooperation, and confrontation, students learn to formulate, structure, and defend their perspectives. Independent Study: students are expected to read the stipulated text for each lecture and seminar session, as well as to read more widely in recommended texts for this course. Additionally, students are expected to conduct independent research for their contribution to seminar discussions, and for their research project. Learning outcomes for independent study are achieved through students’ own reading, research and preparation, seminar presentations, and in their research project.

Indicative Reading List Heidi M Schooner and Michael W Taylor, Global Bank Regulation (Elsevier, 2010) (Main text). H-W Sinn, Casino Capitalism (Oxford University Press, 2010). Charles P. Kindelberger, Manias, Panics and Crashes (Palgrave Macmillan, 6th edition, 2011) Hyun Shin, Risk and Liquidity (Oxford University Press, 2010) Carmen Reinhart and Kenneth Rogoff, This Time is Different (Princeton University Press, 2009)

Method of Assessment (and how the chosen method of assessment is related to learning outcomes) Students will be required to submit a paper of maximum 3000 words at the end of the course chosen from a list of topics provided by the course tutor. The topics will test students’ ability to apply the concepts reviewed in the course to specific problems and issues with relevance to real estate professionals. This paper provides students with an opportunity to focus in depth on a question and undertake a structured investigation, analysis and reasoned argumentation. This enables students to demonstrate acquired knowledge and understanding of the key concepts, display an ability to find organise and use information, and interpret this material in a creative fashion. Students will have the opportunity to bring to bear competing explanations and positions to a coherent argument that demonstrates their ability to reflect critically on their own work.

Summary of Assessed Elements, and Percentage Weight of Each Element Term paper = 100%