Comm bank tips

1. Week 3: NOT included

2. Regulation (Week 12) deposit insurance, compliance, source, std nt needed
3. Week 1: Financial institutions specialness important
Concepts : e.g. risk intermediation etc
4. Week 2: Risks (10 risks) Interest rate risks (repricing model, duration
model)- theory and mcq
5. Week 3 not coming out
6. Week 4: capital planning and why, 2 systems, AGM and ICGR
- Target model, dividends impact on this issue- capital planning
- Planning growth and risk management
7. Week 5: Capital adequacy- important
- Calculations, buffer, tut and tests
8. Week 6 Liquidity important
- Models to measure the risk
- Finance gap etc- simulation- deposit drain
- Liability management- not too important- just know how to choose liability
(in slide)
9. Week 7 and Week 8: Credit risk
- 2 parts: single loan, and portfolio
- Important
- RAROC
- Altman formula given etc
- Term structure: to do the pricing, how much interest rate must be when
comparing 1+k and 1+i
- Concentration risk- modern portfolio theory and kmo forget these,
dont forget the other models
- how to manage those risks- derivatives and options no need worry
about derivatives and options
- Option pricing dont worry
10.Week 9: Portfolio management-forward option yield curve policies controlling
stock with yield curve ladder split maturity riding the yield curve-
arbitraging: EVERYTHING
11.Week 10: ALL also related to price risk, market risk- direct
12.Week 11: Securitisation- risk important- modern banking- Week 11 tut 3a 3b
3c
How to deal with CMO etc formulas given