International Banking 2600-IBP-IB

1. The Banking Business and Banking Services
The essence of banking as a financial intermediary and the role of banks in mobilizing savings, financing investments, and facilitating payments in the economy. Students will explore the wide spectrum of banking services, including deposit-taking, lending, investment services, payment systems, and advisory functions, as well as the increasing importance of digital and mobile banking in shaping customer expectations.
2. Bank Regulation and Supervision – Why Do We Need It?
Rationale for regulating banks as systemically important institutions whose stability underpins the broader financial system. The course discusses the goals of regulation (financial stability, consumer protection, and systemic risk mitigation) and the main supervisory approaches applied worldwide. Case studies will illustrate lessons from global financial crises and regulatory reforms.
3. Bank Performance and Risk Analysis
Students will learn to interpret bank financial statements (balance sheet, income statement, and cash flow statement) and assess performance using profitability, liquidity, efficiency, and solvency ratios. Special emphasis will be placed on identifying risk factors in banking, both idiosyncratic (e.g., credit portfolio quality, operational inefficiencies) and external (e.g., macroeconomic shocks, market volatility, geopolitical events).
4. Banks’ Sources of Funds
Analysis of how banks finance their activities: traditional sources such as deposits, equity capital, and interbank borrowing, as well as modern instruments like securitization, subordinated debt, and wholesale funding. The implications of funding structure for bank stability, profitability, and risk exposure will be examined.
5. Banking Systems: Comparative Perspectives
A comparative analysis of the Anglo-Saxon (market-based) and Continental (bank-based) banking models, with a focus on differences in intermediation, regulation, and corporate governance. The course also reviews the functioning of the European banking system, highlighting the integration of banking markets and the role of EU institutions.
6. Supervision and Regulation of Banking in the EU
Detailed coverage of microprudential and macroprudential frameworks within the EU, including the role of the European Central Bank (ECB), the Single Supervisory Mechanism (SSM), and the European Banking Authority (EBA). Students will explore capital adequacy standards (Basel III, Basel IV) and their application in European and global contexts, including stress testing, leverage ratios, liquidity coverage ratios (LCR, NSFR), and systemic buffers.
7. Risk Management in Banking
Comprehensive analysis of key banking risks:
• Interest rate risk – impact of changing rates on banks’ balance sheets and profitability; tools such as duration gap analysis;
• Currency risk – exposure from international operations and cross-border activities, hedging strategies with derivatives;
• Credit risk – evaluation of borrower creditworthiness, rating and scoring models, portfolio diversification, and securitization;
• Liquidity risk – challenges of balancing short-term obligations with long-term lending, liquidity stress tests, and central bank facilities;
• Operational risk – risks arising from internal processes, cyber threats, and human error; methods of identification and capital requirements.
8. Emerging Trends in Global Banking
Discussion of new forces shaping the global banking industry:
• The growing role of FinTech firms in payments, lending, and investment services, as well as the challenge of BigTech entry into financial markets;
• Digital transformation of banks – blockchain, cryptocurrencies, central bank digital currencies (CBDCs), and AI applications in compliance and risk management;
• The rise of sustainable and green banking, ESG factors in bank lending, and climate-related risks in the financial sector;
• Post-pandemic challenges, resilience building, and the role of banks in financing energy transition and innovation.
9. Case Studies and Practical Applications
Through real-world case studies, students will critically analyze major issues in international banking, including bank failures, cross-border resolution mechanisms, and the interplay between regulation, innovation, and competition in shaping the future of the industry.

Total Hours - Student Workload (4 ECTS - 100 hours):
Class Sessions (Including Assessment and Examination) - 30 hours
Reading Literature for Classes - 20 hours
Preparing Assignments - 50 hours