Banking & Finance

Präsentation Vertiefungsfach vom 1. April 201

Prof. Dr. Raúl Gimeno

FRM,CAIA, PRM

t
Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 1

Why Banking & Finance?

Some facts on the Swiss financial sector:

• More than 300 Banks, 200 insurance companies, 3000 endowments
(Pensionskassen) and a lot of finance departments within companies.
• The Swiss banking system has a contribution of CHF 35.9 bn to GDP,
which represents a share of 6.7% of GDP.
• The corresponding value for the insurance sector represents an added
value of CHF 23.2 bn respectively 4.3% of GDP.

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 2
Work force im Swiss Financial System

200‘000 people work in the financial sector which represents 6% of the

Swiss labour force.
• 107'500 in banking sector,
• 28‘400 in other financial companies (independent wealth managers
etc.),
• 64‘000 in insurance sector.

Furthermore Swiss banks employ more than 102’800 employees abroad.

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 3

Workforce in Swiss Banking System

2007 2008 2009 2010

2012 2011
Alle Banken 136'200 135'740 129'807 132'013 132'542 128’914
Kantonalbanken 16'754 16'917 17'271 17'404 17'456 17’399
Grossbanken 66'924 63'900 58'342 59'392 59'792 54’431
Regionalbanken und Sparkassen 3'892 4'021 3'980 4'004 4'128 4’160
Raiffeisenbanken 7'208 7'665 7'999 8'068 8'167 8’216
Übrige Banken (Handels-, Börsen-
Kreditbanken…) 35'775 37'021 35'936 36'835 36'635 35’042
Filialen ausländischer Banken 1'334 1'454 1'420 1'468 1'527 1’469
Privatbankiers 4'313 4'761 4'859 4'842 4'836 4’198

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 4
 Gross monthly wage

Gross monthly wage (median) by economic branch

10 000

9 000

8 000

7 000

6 000

5 000

4 000
TOTAL Manufacture Sales Financial Professional Services
of goods insurance
Source: http://www.bfs.admin.ch/bfs/portal/en/index/themen/03/04/blank/data/01/06_01.html#1

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 5

Gross Monthly Wage 2014

last survey

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 6
Jobprofile

Banking sector:
• Trainee on the job
• Assistant relationship Manager
• Back-office
• Risk-Controller
• Trading
• Wealth Management

Career Start Program von CS

• The Career Start Program combines practical experience with structured
training.
• Lasts 18 months
• Career Start allows you to develop your own initiatives while working in
a structured environment.

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 7

Job Profile

Insurance:
• Trainee or „on the job“ learning
• Sales activity
• Risk Analysis (Schadensrisiken)
• Risk-Controller
• Back-office

Companies:
• Finance department
• Treasury department, Stab
• Controlling

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 8
 Why Banking & Finance and not …..?

• Practical teaching: cases studies, use of EXCEL as in companies

• Use of multimedia learning elements

• Professors with long practical experience in banking sector

• The contents of Majors’ and Minors’ follow the dynamical and innovative
development in the finance industry.
• You get the needed skills and know-how to work in different financial
areas (insurance, banking, consultancy…)

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 9

Banking & Finance

Module When?

Fixed Income (MBF1) HS

Major Derivatives (MBF2) HS
Majors

Banking & 
Finance Risk Management (MBF3) FS

Portfolio Management (MBF4) FS

Security Markets (IBF1) HS

Minors

M&A and related transactions (IBF2) HS

Minor
Banking &  Bank & Insurance Management (IBF3) FS
Finance
Alternative Investments (IBF4) FS

HS: Autumn Semester ; FS: Spring Semester 
Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 10
Security Analysis– Major

Lecturer: Dr. Raul Gimeno

Part I: Fixed Income
• Fixed income instruments
• Yield to maturity and risk measurement (Duration)
• Term structure of interest rates
• Management of fixed income portfolios
• Convertibles

Part II: Structured Products

• Capital Protection products
• Yield Enhancement products
• Participation products

Multimedia Learning platform with Multiple-Choice-Questions

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 11

Derivatives – Major

Lecturer: Prof. Alberto Rascón

• Understand Pricing and Strategies of Derivate products.
Introduction to derivatives contracts
• SWAPS
 Calculation of “Floating leg” IRS,CS, IRCS, How to price SWAPs
 How to use SWAPs
• Option Theory
 Synthetic options
 Option strategies
 Pricing models: Binomial Tree and Black and Scholes Model
• Credit derivatives
 Credit Default SWAP
 Credit Link Note
Individual work with Excel, written test
Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 12
Portfoliomanagement –Major

Lecturer: Dr. Raul Gimeno

• Performance measurements
• Performance attribution
• CFDs: contract for difference
• Asset Allocation
• Index Tracking
• Portfolio Optimisation
• Relative Optimisation
• EXCEL exercises
• Demo-Account used to simulate investment decisions
• Group presentations
• Exam: in excel format

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 13

Risk Management – Major

Lecturer: Dr. Raul Gimeno

Lecture based on the book of Saunders&Cornett: Financial Institutions
Management (compulsory)
Introduction to
• Interest rate risk
• Operational risk
• Credit risk
• Market risk
• Sovereign risk
• Foreign exchange risk
• Liquidity risk

Case studies, exercises

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 14
M&A and related transactions – Minor

Lecturer: Alberto Rascon

• Get to know the M&A process
• Why should we do make a “DEAL”?
• What is a DEAL?
• Process
• Going Private (MBO, MBI)
• Selecting a Firm
• Antitrust regulation
• Valuation
• Due diligence
• Interdisciplinary: Finance, Law, Strategy, Organization, etc.

Presentation: work group

Case studies

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 15

Capital Markets (IBF3)– Minor

Lecturer: Dr. Sandro Bächli

• Overview over the Financial System

 Fundamentals of financial markets
 Fundamentals of financial institutions

• Investment Process
 Strategic asset allocation
 Tactical asset allocation

• Financial Markets
 Financial stability and financial crisis
 Mortgage, bond and stock market
 Initial public offering

Group work, investment documentation, presentation

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 16
Bank and Insurance Management – Minor

Lecturer: Csilla Schreiber-Orosz

• Introduction to Bank- and Insurance Management and Management of
other financial institutions.
• Overview of the financial environment, Behavioral Finance, Role of
financial institutions, Regulatory aspects in Switzerland
• Bank operations, Bank Management
• Insurance operations, Types of Insurance, Pension Systems, Asset-
Liability Management
• Insurance Management, defined contribution and defined benefit plans
• Financial Institutions, Financial Management and Valuation
• Capital Markets, Introduction to Private Equity and Hedge Funds

17
Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 17

Alternative Investments

Lecturer: Dr. Raul Gimeno/ Dr Sandro Bächli/ Alberto Rascón

Private Equity (Bächli): for companies that are not publicly traded
• The business model,
• various investment stages
• exit strategies
Hedge Funds (Gimeno): pooled investment vehicle
• Introduction and characteristics
• Various strategies
Behavioral finance (Rascon): considers the influence of psychological factors
on individual choice behavior when making financial decisions.
• Decision making process, Expected Utility theory
• Psychology and the individual investor
• Some applications to behavioral finance

Assessment based on a presentation (75%) and a multiple choice exam (25%).

Group presentation on week 23

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 18
What is expected from you?

• Interest for financial issues

• Interest in using quantitative methods
• Interest in using EXCEL for solving problems
• Good command of English: all courses taught in English
• Readiness for working hard

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 19

Gross monthly wage

Gross monthly wage (median) by economic branch

10 000

Remember…
GOOD ROI
9 000

8 000

7 000

6 000

5 000

4 000
TOTAL Manufacture Sales Financial Professional Services
of goods

Source: http://www.bfs.admin.ch/bfs/portal/en/index/themen/03/04/blank/data/01/06_01.html#1

Berner Fachhochschule | Haute école spécialisée bernoise | Bern University of Applied Sciences 20